InfoWorld's Ted Samson says this is Microsoft's way of telling the world it's serious about mobile. I think this is their way of telling shareholders it's time to sell.
Microsoft has succeeded because a) Bill Gates realized early on that if you controlled the operating system, you could control the entire PC market; and 2) he and Ballmer used this control to bully hardware makers and enterprises into following "the Microsoft way."
As Microsoft has since discovered, you can't bully your way into the consumer electronics market. Unless you possess a huge institutional advantage (like, say, owning the operating system), you have to actually persuade people your products are better. If you've spent the last 20 years lying to them about how well your products work, they aren't inclined to believe you.
So Microsoft axing one of its captains may look like it's taking its troubles seriously, but it isn't going to solve the problem. Microsoft's biggest problem is the big, bald sweaty guy at the top. You want to see real change in Redmond, that's where it has to happen. But don't count on seeing that any time soon.
How would you solve Microsoft's problems? Post your thoughts below or email me: firstname.lastname@example.org.