Microsoft Without Bill Gates?

Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.

Yesterday's semi-euphoric stock-market greeting for the start of the government shutdown is giving way to a more sober reaction. The major indexes opened lower this morning, with the S&P 500 and the narrower, price-weighted Dow Jones Industrial Average are down 0.74% and 0.84%, respectively, at 10:25 a.m. EDT. That may be a more appropriate response if this morning's front-page Wall Street Journal headline, "Capital Digs In for Long Haul," proves prophetic.

According to payroll processor ADP, private employers added 166,000 jobs last month, missing economists' forecast for 180,000. In addition, the figure for August was revised down to 159,000 from 176,000 -- lackluster numbers, indeed. With the Department of Labor unlikely to release its September employment report due to the shutdown, the ADP data will stand alone this week, and it doesn't provide the sort of background music that will have equity traders rushing to the dance floor.

More change in the cards at Microsoft?
The winds of change aren't letting up at Microsoft . Just two days after CEO Steve Ballmer gave an emotional final companywide address, Reuters is reporting that three of the software concern's top 20 investors are pushing for Bill Gates to step down as chairman of the board.

As the co-founder of Microsoft, Gates remains its largest shareholder with a 4.9% holding, but that stake is set to go to zero by 2018 under a plan of regular stock sales. According to Reuters' report, the trio of investors who would like him to step down own 5% of the shares in aggregate and feel that Mr. Gates' influence at the company is disproportionate with his economic stake, particularly as he sits on the committee that is searching for Steve Ballmer's replacement (incidentally, The Wall Street Journal recently put together an excellent profile of the man who heads that committee, John W. Thompson).

I'm torn on the question of whether Bill Gates should remain Microsoft's chairman. On the one hand, I understand the drive for new blood in that role to coincide with Mr. Ballmer's succession. Furthermore, for all his achievements, I don't think Mr. Gates has been particularly effective as a technology visionary -- on that front, he doesn't approach his late rival, Apple's Steve Jobs. Nonetheless, I do think he has improved corporate governance at Microsoft, partially as a result of the influence of his friend, Berkshire Hathaway CEO Warren Buffett.

Replacing Gates at this time certainly presents a risk. However, as the company embarks on a new devices-oriented strategy to compete with Apple and Google, it may well be a risk worth taking.

Can Microsoft continue thrive in a post-PC era?
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Fool contributor Alex Dumortier, CFA has no position in any stocks mentioned; you can follow him on Twitter @longrunreturns. The Motley Fool owns shares of Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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