Why Microsoft fired Robbie Bach

“Vague justifications about under-performance of Windows Mobile or cancelled Courier miss the whole point [why Microsoft fired Robbie bach],” Horace Dediu blogs for Asymco.

“The chronic problems with Microsoft’s consumer businesses cited as causes for dismissal have roots in core processes and priorities which management changes will not address,” Dediu writes. “The failure of Zune was evident long ago. Windows Mobile has not been competitive with RIM for years, and failed to take significant share from Symbian, never mind iPhone. Tablets were the responsibility of the Windows team. Kin is a rogue project based on a bone-headed acquisition. From a P/L point of view, Entertainment was mostly Xbox, which although deep in the hole over its lifetime, was starting to break even.”

Dediu writes, “No, the reason I believe Bach lost his head is that HP bought Palm… HP is effectively filing for divorce. The blow could not have been more obvious and more cruel.”

Full article here.

26 Comments

  1. in short. he sucked at his job, on a multi billion dollar level.

    I would still would of loved to take his paycheck home though. Apple products sure do get expensive when it’s time to upgrade ” width=”19″ height=”19″ alt=”smile” style=”border:0;” />

  2. @so..
    “Apple products sure do get expensive when it’s time to upgrade”

    My initial investment of in a Mac was the only expensive part for me. Every subsequent update has been cheap because of how much resale value Apple products have.

  3. Bach may have sucked or he may have been micromanaged into failure. Once the iPhone came out, MS leadership should have realized that the entire mobile strategy needed to be rebooted. Instead, Ballmer still had delusions of grandeur, talking about selling 10s of millions of mobile devices using WinMo. Yet even then, they weren’t selling 10s of millions of WinMo devices and it was downhill from there.

    Now, three years later, MS realized they have to start over with WinMo, break compatibility with previous WinMo ecosystem, create an app store, etc. and Zune, WinMo, Kin, all use different, incompatible OSes.

  4. “so” wrote: “I would still would of loved to take his paycheck home though. Apple products sure do get expensive when it’s time to upgrade.”

    Apple products are not expensive. And to the degree they are, you’re more than compensated in quality across the board. In short, “you get what you pay for.”

    Also, anyone who writes “I would still would of loved…” is just asking for it. (By the way, it’s “would’ve” not “would of”! Yikes.)

  5. “so” wrote: “I would still would of loved to take his paycheck home though. Apple products sure do get expensive when it’s time to upgrade.”

    Not the iphone, I’ve upgraded every time, sold the old one on ebay overseas, and even though I was a first adopter and paid the original $500+ price, I’m currently ahead almost $140 on phones since I switched. And that includes making enough to earn back my early termination fee from Verizon.

    My two year old white refurb macbook just paid for my ipad, with a net loss of $25. Even my 8 year old G4 sawtooth 350mhz machine brought in $200 on ebay.

    Apple reputation for quality is paying me to use their products.

    All you gotta do is…
    1. Keep the original packaging, cd’s, and printing.
    2. Use your Apple product for a couple of years.
    3. Sell it on ebay worldwide, with paypal protection.

  6. Agreed, Apple products hold their value.

    I save all original packaging and can easily upgrade my computer every 3 years and recoup 40-50% of the original cost.

    Computers are cheap. Software is expensive (see Adobe Creative Suite).

    Why do people have the mentality that computers are commodities that should be free, while wasting $3 on a cup of coffee each morning?

  7. “Xbox to me, you know, in some mathematical way was a gigantic investment. And yet look, asset value paid off, earnings potential paid off, upside for the future pays off. Id’ do that again in a heartbeat.”

    That’s what Robbie Bach just said in an interview. Notice how he rationalizes the Billions that Microsoft invested/wasted on Xbox. He says the “asset value paid off” which is rubbish, because saying that the Xbox division is worth at least the amount of money sunk into the effort, around $8B, means there has been zero return on investment. A lousy return.

    Then the bigger faux pas is saying the “earnings potential paid off”?!? What, what, what? How does “potential” pay off?!? It’s potential, right?

    And, then, “upside for the future pays off”. So, that’s what Microsoft got for its $8B in investment in the Xbox franchise, “earnings potential” and “upside for the future”, both of those things, Robbie thinks already “paid off”. No wonder Ballmer let these fools run around for so long. They use internal metrics that make no freaking sense.

  8. “Entertainment was mostly Xbox, which although deep in the hole over its lifetime, was starting to break even.”

    “starting to break even” is nothing to spike the ball over, it just means they’ve achieved profitlessness on a quarterly basis after several years of steep losses. There’s probably a $16B hole to climb out of. Actual break-even for the xbox project is an impossible fantasy.

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