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This week in Microsoft

Software giant announces major reorg and Jim Allchin's future retirement.

Microsoft this week announced a sweeping reorganization of the company into three new divisions, a shift that will lead to the retirement of longtime Windows development chief Jim Allchin.

But the software giant wasn't the only one mixing it up this week, as the Gulf Coast braced itself for yet another major hurricane. Sony announced a restructuring plan that will result in the loss of 10,000 jobs. And on the heels of news that Oracle will acquire Siebel Systems, the database giant added software maker G-Log to its portfolio.

Microsoft's restructuring plan--designed to streamline the company's decision-making process and improve product development--calls for a reorganization of the company into three large divisions led by individual presidents, each reporting to Steve Ballmer, Microsoft's chief executive.

Jeff Raikes will head up the company's Business division, which will house Microsoft's Information Worker group (which includes its Office product line), and its Business Solutions packaged applications group.

Kevin Johnson and Jim Allchin will be co-presidents of the Platform Products and Services division, which will comprise Windows Client, Server and Tools and the MSN division. Microsoft said Allchin will hold that new position until he retires, once the company ships Windows Vista at the end of next year.

And Robbie Bach will be president of the Entertainment and Devices division, which will oversee games and mobile device development.

The news had industry watchers sizing up Johnson, reflecting on Allchin's legacy, wondering what reorganization means for Microsoft, and questioning whether Google's expanding roster of Windows-free Web services may have been a factor in the shuffle.

CNET News.com readers also chimed in, some questioning whether the move might be more about shareholder unease than making the company more agile. Reader "Jack Sprat" said while the company might be doing some good in "shortening the line between the customer and the honchos at the top," he thinks the company is "doing anything they can to make some news; otherwise Google gets all the attention."

Reader Carl Johnson adds: "They're just rearranging the deck chairs on a sinking ship. With Balmer at the helm MS is doomed."