October 13, 2006

Microsoft to restructure Windows Core Team

Microsoft Corp. announced plans Thursday to reshape the internal structure of its Windows engineering division, trying to set the stage for smoother operations after the upcoming release of the delayed Windows Vista.

Separately, the company's shares reached their highest closing price since November 2004, finishing trading up 2.5 percent, at $28.22. The rally follows recent milestones indicating that Microsoft is getting close to finishing Windows Vista after five years of development.

The dominant PC operating system is the Redmond company's biggest source of profit. Windows Vista is scheduled for release to businesses in November and to consumers in January.

Last week, Microsoft issued what is expected to be the last public test version of Windows Vista before the new operating system's release.

In another step, the company announced Thursday a variety of third-party devices and programs to be available for the holidays under the Windows Vista logo program, signaling that they will work with the new operating system when it comes out.

The company is also nearing the launch of a new wave of the Microsoft Office productivity programs, its second-most profitable product line.

Microsoft said the changes announced for the Windows Core Operating System Division will take effect after Vista's release, applying to work on future versions. They're designed, in part, to streamline the division and make it more flexible. Microsoft said the changes won't involve layoffs.

It's part of a broader revamp of Windows development efforts. Earlier this year, Microsoft brought in Steven Sinofsky, a Microsoft Office executive known for getting teams to meet deadlines, as the senior vice president for the Windows and Windows Live engineering group.

The latest changes include the creation of a new team inside the Core Operating System Division that will "focus on a single, integrated development plan for Windows," the company said.

Microsoft also said it will combine its security, trustworthy computing and engineering excellence teams into a single trustworthy computing group within the Windows Core Operating System Division. That group will be led by Scott Charney, Microsoft's vice president of trustworthy computing.

Among other changes, the company named Jawad Khaki, currently corporate vice president of Windows networking and device technologies, to lead a group within the Windows Core Operating System Division that works with PC makers.

In August, Microsoft named longtime executive Jon DeVaan as the senior vice president leading the division.