Ballmer resigns and people get their signals crossed. (Updated)

Steve Ballmer, CEO of Microsoft since 2000, announced that he would resign in the next 12 months, once a hiring committee found a suitable replacement.  Immediately, MSFT jumped 9% within the first half-hour of his announcement.

First Irony -- mismatched expectations
Ostensibly, the markets shot up, anticipating the benefits of change at Microsoft.  But consider: Ballmer just a month earlier announced -- yet another -- shakeup and realignment of the company.  In his resignation letter, he specifically signaled that he (and the board) had set their direction going forward:

"My original thoughts on timing would have had my retirement happen in the middle of our transformation to a devices and services company focused on empowering customers in the activities they value most. We need a CEO who will be here longer term for this new direction...We cannot and will not miss a beat in these transitions."

If the markets and people were expecting big changes, it seems that the company was looking for stability; they really do believe in the direction they're headed.  Conversely, if markets were excited about stability, they would degrade Microsoft's stock for introducing an unknown: change in CEO.

Second Irony -- mismatched solutions
Back to that letter and that organization shakeup.  In his push for a "transformation to a devices and services company", Windows has been subverted.  They will no longer be a software company, but a devices and services company.  Yet, the biggest problem for Microsoft wasn't hardware, but one of software.

Nokia's hardware is excellent, but what they've primarily done is to displace other Windows Phone manufacturers, who now seem intent on ignoring the WP platform.  Likewise, Microsoft has been dramatically cutting prices on WOA (Surface RT) tablets, then tying them to Bing, to get rid of excess stock.  No one would dispute that the solid block of magnesium alloy that is the shell of Surface RT is nice, and that WOA has everything, hardware-wise, that you'd want and need in a tablet.  But those folks in Redmond just can't admit that the problem of WOA is software.  So while Ballmer signaled that Windows will be the backdrop to quality devices, the market is really signalling that Windows is sick, not the devices themselves.

Third Irony -- mismatched support
This push to support devices by subverting the operating system, further kills the Wintel PC market.  OEM PC makers can see the smoke signals, that at some point in the future Microsoft will buy out Nokia to further its conquest towards becoming a devices company.  The devices companies out there seem to be fleeing Windows for the open arms of Android and ChromeOS, only further reducing Windows' market.  Remember, Ballmer and Gates remain two of the largest shareholders, and as such have considerable influence over the future of Microsoft.  In other words, those folks expecting change are delusional.

What if...things were different in 2010
Then there's this report that Ballmer had been wanting to resign since 2010.  One year after Windows 7, 2010 was the same year that Microsoft released its first Windows Phone.  Preceding the 2013 organization shakeup, if the board had granted Ballmer's wish in 2010, would Microsoft have avoided the desktop OS / WOA tablet debacle?

No.

By nature, Microsoft's board is conservative, and by extension their company is conservative.  The company's culture had been set in the last decade under Ballmer, whether it was the stack ranking system or the repeated efforts to kill experimentation such as the Courier concept.  To emphasize the desire to kill experimentation, last month's reorganization communique relayed the goal of a "single strategy as one company".  By opposite extremes, Google's actions are scattershot, looking to experiment in order to find other streams of income and innovation, and by extension, new core products.  Google Fiber, Glass, Project Loon, driverless vehicles, Chromecast, Google+, Hangouts, Latitude, Maps, Street View...all expansions from Google's core: Search and Ads.

But what if...things are different in 2014
Surely though, with change comes new opportunities to change direction and bring a new culture, right?  Of course not!  Didn't you pay attention to what I wrote?  Microsoft's leadership doesn't want to be Google; they don't want to be a company that spends money on crazy experiments.  They're intent on carrying out the strategy they had set just one month ago.

Therein lies the best part of the announcement: Pundits and markets expect big changes for Microsoft, even while Microsoft has signaled intention to stay the course.

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Update: Well, there you go.  As reported in Bloomberg Businessweek:

"Microsoft Corp is telling employees that a reorganization plan by departing Chief Executive Officer Steve Ballmer will go ahead, seeking to reassure senior managers who are concerned that the search for a successor will throw turnaround efforts into disarray."

Or as I said, people have mistaken the signals coming out of Redmond, if they thought Microsoft was looking for big changes.  They are not going to change, or rather, they've already determined what their direction is, and don't want to veer off that path.