Who's Next as Microsoft CEO: Possible Replacements for Steve Ballmer

WEB EXCLUSIVE: The contenders for Steve Ballmer's replacement make up a deep bench of executive talent with heavy Microsoft experience both inside and outside the company.

Steve Ballmer shook up the tech world with the announcement that he would be retiring within the next 12 months, sooner than expected, and that Microsoft would start the search for a replacement.

Microsoft hasn't revealed much about its search. If Microsoft's board decides to look for an unfamiliar face to reboot the company, they could pick anyone. If Microsoft is looking for seasoned executives with significant high-level Microsoft experience, though, there are plenty of choices from executives currently at or outside the company.

Bill Gates

No name will be floated by more people for the role of replacing Ballmer than the man most closely associated with Microsoft -- Bill Gates. Will Microsoft's co-founder and current chairman come back for a day-to-day role? We'd judge it unlikely.

For starters, when he was at Microsoft, Gates' name was synonymous with monopoly and unfair business practices. While he had plenty of admirers in the business world who loved his hard-charging style, he was at times the most-hated man in tech. Now at the helm of a global charitable initiative, Gates enjoys near universal acclaim for efforts like trying to eradicate diseases that kill children. Attacking Gates now is like attacking Mother Teresa (some cranks like the late Christopher Hitchens were willing to do that, but they are few and far between). There's more to it than vanity, though. Gates' comments over the years indicate that he believes that his computer fortune enabled him to do something far more important in the world, and he's moved on to doing that. Why go back?

The argument that Gates might return Steve Jobs-like to rescue his company is appealing at first glance, but there are some key differences. Unlike Jobs, Gates wasn't forced out in disgrace. He'd built the largest software company in the world, and the accomplishment was largely intact when he stepped away from day-to-day responsibilities at the company.

Finally, it can't be clear to the board that a Gates-in-charge Microsoft would be that different from the Ballmer-in-charge version. Ballmer consulted with Gates regularly and seemed to have Gates' support on all his biggest decisions.

Kevin Johnson

The former president of Microsoft's Platforms and Services Division left the company in 2008 after 16 years as part of a department reorg.  He then went on to become CEO of Juniper Networks  --  one of the first Microsoft executives to make the jump  from one company to the other (Bob Muglia, also on this list, is another). While at Microsoft, Johnson had managed the company's Windows and Online Services groups, as well as oversaw a number of major acquisitions for Microsoft, including the $6 billion buyout of digital marketing company aQuantive. Johnson last month announced he plans to leave his CEO role at Juniper as soon as the company's board finds a replacement.

Stephen Elop

A seasoned executive, Elop was president of Microsoft's Office business before becoming CEO of Nokia, which picked Windows Phone as its future platform of choice.  Nokia wasn't his first shot as a CEO: For three months he ran Macromedia until it was acquired by Adobe. 

Paul Maritz

This former longtime Microsoft executive played a key role in Microsoft's platform and developer tools and was in Bill Gates' and Steve Ballmer's tight inner circle. After founding his own company, Maritz later was tapped to replace Diane Greene as CEO of VMware, which he led for four years. He's now CEO of Pivotal, another company VMware parent EMC is spinning off.

Bob Muglia

As mentioned above, Muglia -- the former head of Microsoft's Server and Tools Business -- is one of several high-ranking Microsoft executives who left Redmond for Juniper Networks. While at Microsoft, Muglia was responsible for several key Microsoft products, including Windows Azure, Windows Server, System Center and Visual Studio. Muglia left Microsoft in 2011 after 23 years with the company to become Juniper's vice president of Software Solutions. Reportedly, Muglia's departure from Microsoft was prompted by disagreements with Ballmer over the Server and Tools Business' strategy. 

Terry Myerson

Sixteen-year Microsoft veteran Terry Myerson has been steadily ascending Microsoft's executive ladder since he joined the company in 1997. He spent eight years at the helm of Microsoft's Exchange unit before becoming corporate vice president of the Windows Phone division. Despite having historically low market share, Microsoft is often quick to note that Windows Phone has won multiple industry awards -- both for the hardware and the platform -- under Myerson's leadership. Lately, the OS has grown its market share to No. 3 in the world, though it still badly trails Google Android and Apple iOS.

Myerson was a key piece in last month's major corporate reorg that was spearheaded by Ballmer: He now runs the new Operating Systems group, which is responsible for the development of the platform for Windows PCs, Windows Phone devices and Xbox consoles.

Satya Nadella

Nadella has been consolidating power, growing revenues and profits, and raising his public profile in the Server and Tools Business for the last few years, and he was among the winners in the recent reorg with responsibility for the Cloud and Datacenter engineering group. The interesting thing about Nadella is that he's well-positioned whether the board moves forward with Ballmer's Devices and Services/One Microsoft strategy or not. If the board wants Devices and Services, Nadella's been heavily involved with cloud. If the thinking tips toward refocusing on Windows/Office/servers, Nadella's been at the heart of one of those core business.

Ray Ozzie

Bill Gates arguably bought Groove Networks to get Ray Ozzie into Microsoft in 2005. It didn't work out and Ozzie left in 2010, although not until he'd masterminded a network of cloud-capable datacenters and laid the groundwork for much of Windows Azure. While Gates started out as a big fan, it didn't seem that Ozzie built a strong following within the ranks at Microsoft. The Lotus Notes creator has been keeping busy with a startup.

Jeff Raikes

One of the highest powered Microsoft executives during the company's heyday is still within the Microsoft orbit even though he's no longer at Microsoft. Jeff Raikes, who joined Microsoft in 1981, is CEO of the Bill & Melinda Gates Foundation. That's given him Microsoft Chairman Bill Gates' ear on a regular basis. When Raikes left Microsoft in 2008, it was widely rumored that part of the reason he left was because there was nothing left for him to do at Microsoft other than be CEO and, at the time, Ballmer wasn't going anywhere.

Tami Reller

Recently tapped to head the marketing group, Reller was previously chief financial officer and chief marketing officer of Microsoft's Windows group. Reller, who came to Microsoft via the Great Plains acquisition, is well-respected among partners and has broad experience across operations and product groups, although at lower levels within Microsoft than many other likely candidates.

Eric Rudder

Rudder has deep technical experience within Microsoft. Besides being a former technical assistant to Gates, he has also served as the company's CTO and as the head of Microsoft Research and the Trustworthy Computing Group. In the recent company reorg, he was named executive vice president of the Advanced Strategy and Research group. Rudder has long been considered a front-runner for CEO, but has mostly stayed out of the limelight in the past decade.

Steven Sinofsky

The former president of Microsoft's Windows and Windows Live group was considered by many industry watchers as the front-runner in the post-Ballmer CEO race -- until he unexpectedly left Microsoft late last year. Even then, some industry watchers did not rule out the possibility of Sinofsky eventually returning to Microsoft to take the CEO role. Sinofsky has been credited with overseeing the Office franchise, one of Microsoft's biggest and most reliable moneymakers, as well as guiding the Windows division to a successful Windows 7 launch after Windows Vista flopped.

Sinofsky was known as a controlling and polarizing figure within Microsoft, and some analysts speculated that his departure was caused by personality clashes with Ballmer. On the other hand, his departure so soon after the launch of Windows 8 and the Surface tablet, which has struggled to gain market share, led to rumors that he was pushed out by a dissatisfied Microsoft board.

Kevin Turner

Microsoft's chief operating officer is notoriously sharp-tongued, evidenced by some of his most recent keynote talks at the annual Worldwide Partner Conference. The former Wal-Mart executive joined Microsoft in 2005 and is now the highest-paid executive in the company. However, analysts have noted that Turner lacks the technology background Microsoft's board is probably looking for in a CEO. He also has a reputation for being too concerned with the bottom line -- for instance, scaling back on resources for small partners -- and not enough on product innovation. In the recent Microsoft reorg, Turner's role was basically unchanged, though he lost some power with the shuffling of marketing responsibilities.

Brian Valentine
A dark horse candidate is Brian Valentine, a famous shipper of Microsoft products, who enjoyed his highest-profile roles while getting Windows 2000 and Windows XP out the door. His last title at Microsoft was Senior Vice President of the Core Operating System Division, although he was something of a fall guy for the Windows Vista OS (no one seems to remember how deeply Bill Gates was involved with Vista). Valentine left Microsoft in 2006 to help Amazon spin up the cloud business that Microsoft has spent half a decade trying to match.

Bill Veghte

The 20-year Microsoft veteran left his role as the senior vice president of the Windows Business in 2010 to join Microsoft's largest partner, Hewlett-Packard. Veghte has held several key executive positions at HP -- head of HP's enterprise software business, chief strategy officer, COO and, as of last week, executive vice president and general manager of HP's Enterprise Group. While at Microsoft, Veghte oversaw the Windows 7 marketing campaign.

Robert Youngjohns

Before leaving Microsoft last fall to become the general manager and senior vice president of Hewlett-Packard's Autonomy division, Youngjohns spent five years as president of Microsoft's formidable North America Sales and Marketing team, which numbered roughly 8,500 salespeople and accounted for over $51 billion in revenue for Microsoft in 2007, when he joined the company. Before that, he held various high-ranking executive roles in Sun Microsystems and Callidus Software.