Microsoft cloud computing chief is named as next CEO

Satya Nadella, the head of Microsoft’s cloud computing business, was named Tuesday to be Steve Ballmer’s immediate replacement. He is only the third chief executive in Microsoft’s 38-year history.
Published: February 4, 2014

As longtime Microsoft insider Satya Nadella takes the company’s helm, he is declaring a new focus on a “mobile-first, cloud-first world.” So far, he only has the latter half of the formula figured out.

Microsoft and its new CEO are at a crossroads: They are trying to catch rivals such as Apple, Google and Amazon, which are building a thriving ecosystem for mobile devices. At the same time, the company wants to expand its burgeoning business as a provider of software and services over the Internet.

Nadella, the head of Microsoft’s cloud computing business, was named Tuesday to be Steve Ballmer’s immediate replacement. He is only the third chief executive in Microsoft’s 38-year history.

The 22-year Microsoft veteran has enlisted the help of company founder and first CEO Bill Gates, who is leaving his role as chairman to serve a more hands-on role as an adviser at Nadella’s request. Gates will spend a third of his time working on products and technology.

Nadella, 46, led the company’s small but growing cloud computing unit, in which customers pay Microsoft to house data and run applications on distant servers connected to the Internet. Those services are a departure from Microsoft’s traditional business of making software for installation directly onto PCs.

In addition to growing that business, one of Nadella’s first tasks as CEO will be to complete Microsoft Inc.’s $7.3 billion purchase of Nokia’s phone business and patent rights — part of a plan to boost Windows Phone software in a market dominated by iPhones and Androids.

“Going forward, it’s a mobile-first, cloud-first world,” Nadella said Tuesday in a video accompanying the announcement.

He said he would capitalize on Microsoft’s experience making the industry’s leading productivity software package, Office.

“We need to be able to pick the unique contribution that we want to make,” he said. “That’s where our heritage of having been the productivity company … is what we want to get focused on.”

Gates will remain on the company’s board. The new Microsoft chairman will be board member John Thompson, who led the search for a new CEO after Ballmer said in August that he planned to step down.