That Microsoft’s Kin phone, which was launched in May and discontinued in July, was an embarrassment to the company is not newsworthy – it’s water under the bridge. What is newsworthy is the fact that its failure cut pretty deeply into Microsoft CEO Steve Ballmer’s bonus check this year.
According to Microsoft’s Definitive Proxy Statement for this year, Ballmer’s maximum potential bonus was 200% of his $670,000 base salary, but his actual bonus turned out to be just 100% of his base salary. Listed as reasons for this cut were the Kin’s failure, “loss of market share in the company’s mobile phone business,” and “the need for the Company to pursue innovations to take advantage of new form factors,” meaning that Microsoft needs to find a way to succeed on a platform that isn’t a traditional desktop or laptop computer.
This puts pressure on Ballmer and on Microsoft to deliver with Windows Phone 7 in much the same way that they delivered with Windows 7, and also to deliver a viable competitor to the iPad and upcoming Android tablets.
Ballmer himself has had little but harsh words for the Kin, labeling it a distraction in a recent interview with The Seattle Times:
The No. 1 message from Kin is a message of focus. You only get so many things you can really talk about, communicate, work on with the consumer. You’ve got to be bold, you’ve got to look forward and you’ve got to stay focused. Kin was neither — with 20-20 hindsight — bold enough relative to where the market’s going, and it just defocused activity from Windows Phone.
With the reduced bonus, Ballmer’s salary for this year stands at $1.34 million – though he’s surely missing his bonus, it probably eases his pain to go to sleep on his giant pile of money.
100% of target still says you met all expectations, you just didn’t exceed them. That’s laughable under the circumstances. This is all theater. The board felt they needed to do something to appease Wall Street which has been expressing increasing dissatisfaction with Ballmer’s leadership. So they came up with this mild rebuke. The mobile market was lost over the years previous and the board never said a thing. And Ballmer isn’t even the executive directly in charge. That was Bach, who was responsible for tablets and Kin as well. He also got 100% of bonus. Bach should have been removed years earlier, and Ballmer should have been fired for not doing that and letting both the mobile and tablet market be lost. Instead, both get 100% of targeted bonus. And that’s why MS continues to circle the drain…
pay cut ??? omg why is going to buy rice tonight…!!!!
i meant how not why.. lool
I think I should be hired to restructure Microsoft. The new goals are to restructure Windows Phone, Windows, Office, and all departments to improve our products and develop new strategies.
Thanks for shearing this info very helpful