Exclusive: Microsoft loses last Xbox founder, mobile PC visionary
It's the end of an era at Microsoft today. — Otto Berkes, the last of the original Xbox founders still at the company, submitted his resignation this afternoon. — Berkes went on to lead development of a new category …
Context & Ripple Effects
Otto Berkes's resignation removes the last member of the original Xbox founding team still at Microsoft, capping a run in which he stayed past the console's launch to lead development of a new mobile PC category. His exit lands in the middle of a crowded week of strategic motion at the company: the closure of the Pioneer Studios consumer-electronics skunkworks on May 19, the first look at Windows Phone 'Mango' and its 500-plus features, confirmation that next-generation Windows 8 systems are due in 2012, and the big Skype acquisition bet announced May 18.
It also extends a familiar arc for Redmond watchers: the 2006 resignation of Microsoft's top blogger was an early marker of the company's most visible voices walking out, and Berkes's departure shows the pattern reaching the founding generation of its consumer hardware business.
First-order effects
- The original Xbox founding team now has zero members left at Microsoft, and the company loses one of the few executives with a track record of shepherding an entirely new hardware category from idea to shipping product.
- Berkes departs precisely as Microsoft is pressing simultaneous consumer bets — Windows Phone 7.5, Windows 8 hardware targeted for 2012, and the Skype integration — leaving those efforts with thinner senior talent.
Second-order effects
- With Pioneer Studios shut days before his exit, Microsoft's internal bench for incubating consumer-electronics experiments narrows further, putting more weight on established product groups to originate rather than absorb new categories.
- Competitors building phone and living-room businesses gain access to a rare founder-level hire whose credentials span both game consoles and early mobile PCs.
Third-order effects
- If the departure of original-console-era leaders keeps up, Microsoft's consumer hardware culture will rest on executives hired after the founding generation, shifting institutional memory away from the people who built its devices business from scratch.
- The steady loss of category creators points to a structural tension large software companies face: once the products a founding team built mature into managed businesses, the builders have little reason to stay.
The trend: The architects of Microsoft's consumer-hardware founding era are exiting as the company pivots toward software-platform bets in phones, tablets, and communications.