Will Ballmer bail after banking big bucks?

Steve Ballmer recently sold $1.3 billion in Microsoft stock and filed to sell another $700 million, sparking talk he's following Bill Gates' exit strategy

Last week Steve Ballmer sold 49 million shares of Microsoft stock, at about $1.3 billion, and has filed to sell 26 million more shares, for a total (at current market prices) of about $2 billion. The last time Ballmer sold any shares of Microsoft was seven years ago, when he unloaded about $1 billion.

Coincidentally, this past week, Bill Gates sold 3 million shares of Microsoft stock. That's not ominous, and hardly unprecedented: In August last year, Bill sold 8 million shares.

All of this selling has triggered wide-eyed speculation that SteveB may be getting ready to jump ship. I read the rumors and muttered to myself, "ridiculous" (actually, I muttered something much less printable), but at the same time I was struck by a little twang of deja vu.

It's absolutely preposterous that Ballmer would be planning a bailout at this point. Consider:

Microsoft's financials have never been stronger. Two weeks ago, Microsoft announced record revenue of $16.20 billion for the quarter ending Sept. 30. Operating income, net income, and EPS hit record highs, up more than 50 percent from a year ago. The dividend went up 23 percent. Microsoft's buying back its own stock, with authorization to spend up to $23.7 billion as of June, and it's swimming in cash reserves, at more than $43 billion (typical for Microsoft).

Microsoft has its best desktop lineup ever. Windows 7 is selling at record rates. Office 2010 is doing well, if not spectacularly. Even Internet Explorer 9 looks to be the least wimpy me-too version of IE in many a year.

Windows Phone 7 has drawn some strong reviews from the most Apple-pie-eyed reviewers in the industry. BlackBerry's fading into oblivion (my phone admin friend breathes a sigh of relief that his BlackBerry Enterprise Server may disappear soon). Corporate admins snarl at the various iOS version conflicts with Exchange. By all accounts Windows Phone 7 -- at least this version -- works very nicely with Exchange. The future's bright.

On the consumer side, Kinect looks to be the runaway Christmas hit -- and it'll drag Xbox sales along with it. To think that Apple almost got the Kinect technology from PrimeSense, whose CEO says, according to Gizmodo, "Apple is a pain in the ass." But I digress.

Microsoft's never had a more profitable full house of products, across so many industries, all raking in the bucks. And all of them are thanks to SteveB's 10-year reign as Chief Chair Thrower. Pundits like to poke at Steve's record at the helm, but the numbers speak for themselves.

Then there's the personal motivation. By selling stock now, instead of waiting until January, SteveB stands to save $100 million in taxes. Unless Congress changes things, the maximum federal capital gains rate goes from 15 percent to 20 percent starting January 1 -- nice chunk o' change for selling now.

And the clincher: Steve himself denies any ulterior motive:"Even though this is a personal financial matter, I want to be clear about this to avoid any confusion... I am excited about our new products and the potential for our technology to change people's lives, and I remain fully committed to Microsoft and its success." Steve's still firmly in control, and will run Microsoft forever. He's pulling out funds to diversify his portfolio. That's about as definitive as you can get.

Now for that twang of deja vu.

I thought this all sounded vaguely familiar, so I took a trip back down memory lane and discovered that Bill Gates went through much the same process when he was preparing to leave Microsoft. Bill's exit strategy extended over a period of years, but he officially handed over the titular role of CEO to SteveB in January 2000, stepping out of the limelight to become the newly christened Chief Software Architect. He gradually cut back his direct involvement, transferred the Chief Software Architect mantle to Ray Ozzie in 2006, and definitively left in 2008.

In 1999, the year before SteveB became CEO, Bill sold $2.5 billion in Microsoft stock. There were assurances all around that Bill was still firmly in control and would run Microsoft forever. Microsoft stock had soared and, the story went, Bill was pulling out funds to diversify his portfolio.

While that's certainly true, it's also obvious that Gates launched his departure strategy with a significant sell-off of Microsoft stock.

There's another parallel that intrigues me. Bill's pivotal philosophical decision, in my opinion, came when he took Brad Silverberg off the Internet Explorer project and put it under Jim Allchin. Many have analyzed the decision, but Brad was looking more toward the cloud (as we would describe it today) and Jim had his roots on the desktop. That happened in 1997, and Brad left the company a couple of years later, just as Bill was handing control over to SteveB.

A different set of circumstances recently beset Steve Ballmer, with Ray Ozzie firmly in the clouds and Steve Sinofsky (widely rumored to be Ballmer's heir apparent) more desktop bound. Is it possible that Ozzie's recent departure came as a result of a philosophical showdown with Sinofsky -- as a precusor to SteveB's exit strategy?

Nobody knows for sure, of course. The principal players certainly don't view this drama unfolding as a Gates Departure Redux. But I can't help but wonder.

This article, "Will Ballmer bail after banking big bucks?," was originally published at InfoWorld.com. Get the first word on what the important tech news really means with the InfoWorld Tech Watch blog.

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