Wall Street wants Ballmer's head, but for the wrong reasons
He's good at preserving revenue; he's bad at making sure there will be some in five years
Microsoft is making progress on several fronts that had it stuck a few months ago, but big investors aren't waiting to see if those positive indications will turn the company around. They want CEO Steve Ballmer fired.
Greenlight Capital President David Einhorn, whose opinion swings with the weight of $5 billion worth of funds to invest, said explicitly that investors had seen enough of "what you can do, let's give so-and-so a chance."
He was primarily concerned with a laggard stock price, but people on the tech side have been critical of the company's progress there as well.
Windows 7 has been a distant also-ran compared to iOS and Android until recently, though Gartner is predicting sales will pick up this quarter.
Microsoft's Azure is still second-fiddle to Amazon's EC2, its Hyper-V is distant second to VMware's hypervisor and infrastructure; the Bing search engine can't find itself in a room made huge to fit Google,; and users haven't embraced the online versions of Microsoft Office in nearly the numbers Microsoft hoped.
IT departments don't make buying decisions based on stock price, except when a company's financial problems are ban enough to make its ability to keep advancing the technology – or even survive – unlikely.
They do hear the buzz, though, and know when a company has missed the big picture on whatever the newest outlook on IT is.
Right now the outlook is based on cloud, public services, off-premise, modular, web-based, highly modular, tightly integrated applications from many vendors, accessed through handhelds running lightweight operating systems.
Microsoft isn't good at any of those.
It's trying to be, but so far with only mixed success.
For investors, Einhorn's take has good and bad points. Ballmer has been running Microsoft's core businesses for a long time and is doing a good job keeping them from eroding while the company tries to push into the next generation. That was his main role under Bill Gates.
Gates was the one that drove Microsoft forward, though, or at least caused others to.
Ballmer isn't as good at that.
From a stockholder's POV it's possible to argue Ballmer should stick around. From a technical point of view it's already too late. Microsoft needs to move faster. Ballmer isn't getting that done.
It's time for him to go.