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May 10, 2010 4:06 PM

Microsoft Executive Leaves to Become AOL CTO



It seems like a handful of Microsoft's top brass want a little more power. That's the only thing I can conclude, after reading news that Alexander Gounares, corporate vice president and CTO of Microsoft's online services division, will become AOL's CTO.

That follows last week's announced job change for former Microsoft executive Bill Veghte, who will become executive vice president of Hewlett-Packard's Software and Solutions Business starting May 17. Veghte led the development of Windows 98, and by the end of his Microsoft career had become senior vice president of the global Windows business.

I wouldn't necessarily take the departure of two key executives as indicative of a Microsoft brain drain--at least not in this case. Both of them departed for arguably more senior positions at other companies. The difference is, HP is a strong company, while AOL, well, not so much.

If Davy Crockett had a choice of running AOL or being stuck defending the Alamo again, he'd probably choose the Alamo. That's not just because the company's first-quarter net income was down 58 percent year over year, while its revenue dipped 19 percent; more importantly, the value of the company's brand hit rock bottom sometime in 2001, and now it's started to dig. Ask yourself: When was the last time you heard mention of anyone using the service?

That hasn't stopped AOL's top brass, though, from trying to muscle forward through slaughter. AOL Chairman Tim Armstrong spent a recent earnings call talking about how the company would return to strength following a radical restructuring, and I suppose stranger things have happened.

In a May 10 statement, Gounares offered no clues as to his decision to join AOL: "Our goal together will be to harness the power of software to deliver on the enormous promise for AOL in its core areas of content, advertising and consumer applications." That's about as broad as it gets.

But as Jon Rubinstein likely learned with Palm, it's tempting for a smart executive, mired in the hierarchy of a massive corporation, to take a position with a company where he or she will have the ability to execute a vision with a substantial amount of force. Whether Gounares can help AOL regain some of its former shine, though, is a real question.

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