Microsoft Reorganizes Windows Under Surface, Panos Panay

Microsoft is reorganizing several of its business units with the new year, with some significant changes slated for the Windows unit. The company is combining its Surface business with the Windows Experience team, creating a new unit: Device + Windows. Device + Windows will be headed by Panos Panay, who has previously overseen Surface development.

Mary Jo Foley broke the news and believes it’ll be a net improvement for Windows 10’s position within Microsoft. While Panay is not on Nadella’s Senior Leadership Team, his boss, Executive Vice President Rajesh Jha, is. Paul Thurrott agrees that this move could be positive for the Windows ecosystem, but has rather harsh words for the state of Windows as a whole. The OS has been systemically devalued by Nadella, who has openly declared that it’s “no longer the most important layer” at Microsoft, radically reorganized the OS dev team structure, and changed the company’s priorities. Windows is still the largest revenue driver at the company, but Nadella has made it clear he sees the future in the cloud.

Thurrott writes that the pressure is now on Nadella to justify his “anti-Windows stance,” and that these changes represent at least a small acknowledgment that Microsoft tried to move past Windows too aggressively. The company hasn’t seemed to have a very cohesive Windows strategy in the past few years — it issues updates, yes, with new features and capabilities — but the closest thing to a cohesive Windows strategy is over on the Xbox side of the company, where Microsoft has been building cross-compatible services and creating an ecosystem with services like Xbox Game Pass. A lot of what we’ve covered in Windows recently has either been stories about reorganizations (intended to make certain the company ships fewer showstopping bugs with its regular releases) or about bug fixes and problems with new patches.

There’s a definite sense that OEMs and Microsoft’s existing business partners might not be happy with this move. Foley brings up the fact that organizing Windows under Surface emphasizes how Microsoft is in competition with its erstwhile partners, while Thurrot notes Panay was widely rumored to be seeking a job with Apple last year. Both, however, see the move as a net positive for Windows. Panay may not have Nadella’s ear directly, but this at least suggests Windows development is moving a little closer to the heart of Microsoft.

And Panay has done well with Surface. What began as a debacle with the failure of Surface RT now earns Microsoft about $4B per year in revenue. That’s not going to compete with the HP or Dell’s of the world any time soon, but it’s a tidy chunk of premium-PC cash that the company has built in less than a decade.

Top photo credit: Microsoft livestream

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