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Microsoft promotes three to division president

The software maker effectively leaves things as they have been in the wake of two top executive departures.

Microsoft has chosen to fill its executive vacancies from within, elevating three current business unit heads to president of their respective divisions.

In a statement this morning, the company said it is naming Kurt DelBene to head the Microsoft Office Division, Don Mattrick to head the Interactive Entertainment Business, and Andy Lees to head the Mobile Communications Business, effectively leaving things as they have been following the departure of Stephen Elop (who was named Nokia CEO last month) and the announced retirement of Robbie Bach.

"One key to Microsoft's success over the years has been our ability to combine a vision for the future of technology with execution that creates compelling products and services that delight our customers," CEO Steve Ballmer said in an e-mail to employees, a copy of which Microsoft posted to its Web site. "Today I am pleased to announce promotions for three people who really embody that combination of vision and execution."

DelBene's group, which is focused on the Office set of products, is somewhat narrower in focus than the one vacated by Elop, which also included the Microsoft Dynamics line of customer relationship management and enterprise resource planning products for midsize businesses. The Dynamics business will continue to be headed by Kirill Tatarinov, who will report to Ballmer.

The moves essentially leave all of Microsoft's businesses in largely the same hands they have been in. Lees and Mattrick have been running their units since Bach announced plans to retire in May. Following Elop's departure, DelBene has been jointly running Office with fellow executives Chris Capossela and unit CFO Amy Hood. Capossela, the longtime head of Office marketing, and Hood will remain in their roles, reporting to DelBene.

Interestingly, Microsoft will leave its financial reporting the same, with five business units--Microsoft Business Division, Server and Tools Business, Entertainment & Devices Division, Online Services Division, and the Windows and Windows Live Division. However, Microsoft's top executives in the Microsoft Business Division and Entertainment and Devices Division will have narrower responsibilities, with no single executive in charge of either entire division.

DelBene, 50, is an 18-year Microsoft veteran who has been heading the engineering and development side of Office. Lees, 45, is another longtime Microsoftie, a former server executive who was brought in in early 2008 as part of a major leadership and direction shift in the mobile business that has led to Windows Phone 7, which will start showing up in phones later this month.

Mattrick, 46, is comparatively new to Microsoft having joined the company in 2007 from Electronic Arts. In addition to leading Xbox and Xbox Live, he will also be responsible for PC and mobile gaming as well as the company's Zune music and video services and Mediaroom, Microsoft's operating system for delivering television over Internet signaling.

While Ballmer's statement and e-mail praised the teams for their execution, Microsoft's board offered a mixed assessment of Ballmer for the past year. He received a bonus equal to his $670,000 base salary, but not the maximum bonus he was eligible for, which would have been twice that amount. Directors praised Ballmer for leading Microsoft to record sales but faulted him for the botched Kin effort as well as the company's overall losses in share on the mobile side.