Want CNET to notify you of price drops and the latest stories?

Microsoft fills top spot in server and tools unit

Company announces it will replace soon-to-depart Bob Muglia with 19-year Microsoft veteran Satya Nadella.

Josh Lowensohn Former Senior Writer
Josh Lowensohn joined CNET in 2006 and now covers Apple. Before that, Josh wrote about everything from new Web start-ups, to remote-controlled robots that watch your house. Prior to joining CNET, Josh covered breaking video game news, as well as reviewing game software. His current console favorite is the Xbox 360.
Josh Lowensohn
6 min read

Microsoft today announced 19-year company veteran Satya Nadella will replace Bob Muglia as head of its server and tools business.

Satya Nadella, Microsoft's new president of its server and tools business. Microsoft

Nadella, who had previously headed up research and development for Microsoft's online services division, was also the lead for the company's business solutions team and a lead engineer in its server group. Microsoft says Nadella's new role as president of the server and tools business is to "oversee the overall strategy, engineering, marketing and product development for Microsoft's server, tools and cloud platform efforts."

The news comes a month after Microsoft CEO Steve Ballmer announced the planned departure of server unit head Muglia, who is set to leave the company "this summer." In the interim, Ballmer had said Muglia would continue on with the company over the next few months to "complete additional projects."

Along with the announcement, Microsoft has released internal e-mails from both Ballmer and Nadella announcing the changes. You can read both at the bottom of this post. In his, Ballmer notes that the company took the search for the replacement from both inside and outside of the company, and that Nadella was "the clear choice."

Mentioned in both Nadella and Ballmer's e-mails is also the departure of Amitabh Srivastava, who had been Microsoft's senior vice president of the server and tools business. Srivastava had been with the company since 1997, with his most recent responsibilities centering around the Windows Azure and Windows Server products. According to Ballmer, Srivastava was "ready to move to a new phase in his career."

As for Nadella's appointment, Ballmer said the company was looking for someone "with the right mix of leadership, vision and hard-core engineering chops. We wanted someone who could define the future of business computing and further expand our ability to bring the cloud to business customers and developers in game-changing ways."

In Nadella's e-mail, the new president notes that the team's mission going forward should center around teamwork. " Individual agendas cannot bog us down--we will make decisions and move on as a team," Nadella said. "As teams and as individuals we need to continuously strive to improve ourselves and those around us."

Below are the two internal e-mails:


From: Steve Ballmer

Sent: Wednesday, February 9, 2011
To: Microsoft - All Employees

Subject: New Leadership for Server and Tools Business

Today our Server and Tools Business is in a position of strength due to our leadership in the cloud, significant product advances such as Windows Azure, and the proven ability to excel and grow in the face some of the toughest competition we've ever seen.

In deciding who should take the business forward, we wanted someone with the right mix of leadership, vision and hard-core engineering chops. We wanted someone who could define the future of business computing and further expand our ability to bring the cloud to business customers and developers in game-changing ways.

With that in mind, I am extremely pleased to announce that I am promoting Satya Nadella to president of Microsoft's Server and Tools Business, effective immediately.

As we said initially, we looked both externally and internally, and I talked to a number of very strong candidates. Satya was the clear choice given we were looking for a person with a deep understanding of and vision for the rapidly merging worlds of servers and services, as well as experience in managing cloud infrastructure and services at scale.

Satya has the ideal skill set for this opportunity, having worked in the Server Group in his earlier years at Microsoft and most recently serving as senior vice president of the Online Services Division where he has effectively been CIO of one of the largest cloud infrastructures in the world, spanning our Search, Portal, and Advertising platforms.

In his role in the Online Services Division, he led the overall R&D efforts for some of the largest online services and drove the technical vision and strategy for several important milestones, including the critical launch of Bing, new releases of MSN, Yahoo! integration across Bing and adCenter, and much more.

Satya is also well-known for his leadership. He has strong collaboration skills, is decisive in both decision-making and delegating, and has strong customer insights, engineering and business expertise. He also knows how to structure organizations for outstanding performance.

Equally as important, he has demonstrated the ability to cultivate talent and build a world-class engineering organization, attracting some of the brightest technical minds from within Microsoft and across the industry.

Please join me in congratulating Satya, and welcoming him to his new role.

As I announced previously, Bob Muglia will work through the summer and help onboard Satya. I want to thank Bob again for his extraordinary contributions to Microsoft and his insights and assistance in the months ahead.

In addition, Amitabh Srivastava, senior vice president in the Server and Tools Business, will leave the company. As I noted above, Windows Azure is in a great place, and Amitabh is ready to move to a new phase in his career. He has done stellar work for the company and will work to ensure a smooth transition with the Windows Azure team. I wish him well in his new endeavors.


And Nadella's e-mail:

From: Satya Nadella
Sent: Wednesday, February 9, 2011
To: STB FTE Worldwide

Subject: RE: Organizational Changes

Hello Team:

I am thrilled to get the opportunity to work with you all as part of STB.

My early career at Microsoft was in servers. Since then I have watched in admiration as you have built a great team and a great business, and in the process have fundamentally transformed the application development and backend server infrastructure landscape.

We are on a path to change the world again with our next generation application development and cloud platform, and I feel fortunate to be part of this transformation. Our core capability as a division - our computing infrastructure and platforms - is the key driver of computing going forward. Today we are seeing our existing customers move to the cloud to address issues of cost and complexity; tomorrow, our work as leaders in innovation will result in new scenarios and workloads (some of them unimagined!) enabled in the cloud.

Our application development and tools teams and products are one of Microsoft's great assets that support all our businesses. We will continue to drive our roadmap in alignment with our sister divisions within Microsoft.

I like to have my head in the clouds and feet on the ground (something I learned from Qi). I want us to be principle driven. What I value most is coming together around a singular mission and working this mission with great teamwork, guided by our principles, authentic communication and impeccable coordination. Individual agendas cannot bog us down - we will make decisions and move on as a team. As teams and as individuals we need to continuously strive to improve ourselves and those around us. These to me are the keys to moving fast with least friction to deliver superior value to our customers, and to win in the marketplace.

I have tremendous admiration and respect for the leaders in STB. I have worked for Bob and worked with many others in the leadership team in the past, and I am looking forward to partnering with all of them - and all of you - to ensure a smooth transition and continued momentum.

As you also know from Steve's mail, as part of this transition Amitabh Srivastava has decided to pursue other opportunities. The Server and Cloud team has achieved significant progress under Amitabh's leadership and I am sad to see him leave the company. His legacy is a very strong team executing on a compelling vision - one I'm very excited about and believe in deeply. I have asked Bill Laing to step in as interim leader for this team.

We have a great opportunity ahead of us and my first priority will be to work with my leadership team to ensure we don't slow down in seizing this opportunity. Let's keep driving forward and increase our momentum together!

Looking forward to getting to know you and contributing to our joint success,

- Satya