Ballmer Says 23-year Veteran Muglia to Go

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Microsoft announced Monday that another member of the company’s old guard is leaving the software maker this summer — and the reason may not be entirely that he wants to retire.

In fact, while praising Bob Muglia, president of Microsoft’s (NASDAQ: MSFT) Server and Tools Business (STB), for growing the division into a $15 billion business, CEO Steve Ballmer made it clear that the decision for Muglia’s departure was an executive decision designed to shake up the company.

“I have decided that now is the time to put new leadership in place for STB. This is simply recognition that all businesses go through cycles and need new and different talent to manage through those cycles,” Ballmer said in an e-mail to employees.

Ballmer’s move comes at a time when, despite continuing to break revenue and earnings records quarter after quarter, he and the company’s stock have been faring poorly with investors.

At Microsoft’s annual shareholders meeting in November, investors complained about the stock’s stagnancycompared to the go-go days of a few years ago, and the positive performance of competing stocks.

“In conjunction with this leadership change, Bob has decided to leave Microsoft this summer. He will continue to actively run STB as I conduct an internal and external search for the new leader,” Ballmer said.

Muglia will be only the latest of several senior Microsoft execs to leave the company in what appears to be a long-term realignment of the company’s leadership.

For instance, in May, Ballmer announcedthat Robbie Bach, president of the Entertainment and Devices Division (EDD), and J. Allard, EDD’s chief technology officer, were both leaving. Ballmer has EDD reporting directly to him currently.

EDD has responsibility not only for games and consoles, but also for the Kinect controllerless game controller and the Windows Phone 7 — both of which launched just in time for the holiday sales season.

Muglia, who has been with Microsoft for 23 years this month, was promoted to president of STD two years ago. According to a Microsoft statement, STD has responsibility for infrastructure software and developer tools, as well as the company’s cloud platform. That includes Windows Server, SQL Server, Visual Studio, System Center and the Windows Azure Platform.

Microsoft has also lost other senior executives recently.

Although Ballmer apparently had little to do with his decision to leave, Stephen Elop, then president of Microsoft’s Business Division, left last fall to become CEO of Finnish mobile phone giant Nokia.

In October, Ray Ozzie, Microsoft co-founder Bill Gates’ hand-picked successor as the company’s Chief Software Architect, announced he too was leaving. S

Beyond Ballmer’s e-mail, a Microsoft spokesperson said the company has no comment on Muglia’s departure.

Stuart J. Johnston is a contributing writer at InternetNews.com, the news service of Internet.com, the network for technology professionals. Follow him on Twitter @stuartj1000.