Microsoft's Ballmer dances, jokes and tackles all the subjects in onstage interview

LAS VEGAS — Amid a tempest of change, Microsoft's brash leader, Steve Ballmer, gave one of his most comprehensive and entertaining interviews in recent memory Thursday.

Microsoft is pursuing Yahoo to catch Google, scrambling to adjust to fundamental industry changes, grappling with continued fallout from its past business practices and preparing for the departure of co-founder Bill Gates.

Ballmer took questions on stage at Mix, the company's conference for Web developers — an increasingly important constituency as advertising-driven online software comes to the fore. So important that Ballmer reprised his early-2000s "Monkey Boy" persona, in which he infamously ran and leapt around the stage of one company conference and chanted, "Developers! Developers! Developers!," at another.

This time he stood up and chanted "Web developers!" to cheers from more than 1,500 of them in the audience.

His interviewer was Guy Kawasaki, a renowned technology executive most closely associated with rival Apple. Kawasaki pulled no punches during an hour of pointed questioning that hit on some of Microsoft's and Ballmer's most sensitive issues, but Kawasaki still managed to come across as good-natured.

The two men even tussled on stage over Kawasaki's MacBook Air notebook computer.

Ballmer, also rumored to be part of a group of Seattle-area businessmen seeking to buy the Sonics, had no comment on his involvement. Asked what he'd like to see happen with the team and what he was prepared to do to make it happen, Ballmer said, "I'm not talking about that today."

Kawasaki, in his introduction, also alluded to the Sonics.

"Why didn't you hire me back in '87 or so?" he asked Ballmer. "I'd own the San Jose Sharks and you'd own the Sonics. Life would be good."

"Life would be good. Life would be good," Ballmer replied.

On buying Yahoo

On Feb. 1, Microsoft announced an offer to buy Internet giant Yahoo for $44.6 billion as part of a huge effort to catch Google in online search and advertising. Yahoo's board rejected the offer as too low and has since been negotiating with other potential buyers.

As a way to force the issue, Microsoft is expected to propose its own set of company directors for election at Yahoo's board meeting later this year.

Ballmer steered away from deal strategy and focused instead on the company's reasons for going after Yahoo.

"Advertising on the Internet is a big thing, and will be the next super-big thing," he said. "There's no question about that. Search ... at least today and for the foreseeable future, it is the killer application for online advertising."

He added: "We've got a long way to go, and Yahoo seems to be a way to accelerate that with the critical mass that's really required to compete."

When Kawasaki pushed for an update on the deal, Ballmer said, "We made an offer. It's out there, baby!"

Kawasaki egged Ballmer on, alluding to his famous temper and enthusiasm: "Don't pick up any chairs and throw them at me. ... Don't go monkey on me, either."

On shifting landscapes

Ballmer named some of the competitors Microsoft faces in its core software businesses: Apple, Linux, IBM, Oracle. But not Google. "They've got aspirations, but they're not present," he said.

While the lion's share of Microsoft's revenue and virtually all of its profit come from these core businesses, some of which it has dominated for close to two decades, major changes are afoot.

More software functions are being consumed as online services, which depend less on operating systems and place the Web at the center of people's digital lives.

Much conference discussion focused on Microsoft's efforts to make tools for developers building these services, and the company is incorporating services into virtually all of its products.

Ballmer, as blunt as he's been on the topic, positioned Microsoft as the underdog in online services.

"We're just the little engine that could and we're working away and working away. ... [It] may be my last breath at Microsoft, but we're going to be there, and we're going to be working away at building share," he said.

When Kawasaki questioned Ballmer's underdog status, Ballmer said Google has, depending on the country, 50 to 90 percent of the market.

"Why don't you sue them for antitrust?" Kawasaki asked.

"You want governments to sue people for antitrust," Ballmer said.

On antitrust matters

Microsoft, of course, is still dealing with the fallout from antitrust actions by U.S. and European regulators. The European Union slapped it with a $1.35 billion fine last week, and two investigations there are ongoing.

Ballmer noted the company's recent major steps toward sharing more technical specifications for some of its biggest products. Withholding that information was part of how it illegally leveraged its Windows desktop monopoly.

But Ballmer declined to comment on the antitrust implications of acquiring Yahoo.

On Bill Gates

Ballmer and all of Microsoft face the prospect of Gates' departure later this year. After a summer vacation, Gates will focus most of his time on his charitable foundation, work part time at Microsoft and retain the title of chairman.

"We don't know exactly what that means, being part time," Ballmer said.

He reiterated Microsoft's transition plan, which puts two senior executives — Ray Ozzie and Craig Mundie — in Gates' role, and added that another "five or six key leaders" will step up as well.

And he downplayed the importance of any individual, Gates included, noting that new products and innovation come from thousands of Microsoft employees across the company.

In addition to his jabs, Kawasaki had some nice things to say.

As a venture capitalist, he said, he's worked with Microsoft a lot in recent years.

"It's a different Microsoft," he said. "There's not the arrogance, there's not the sort of bullying aspect. These people are really smart, they're really hardworking. ... I just want to give you a little bit of praise. The new Microsoft employee is very different. It's really very easy to work with your company."

It was perhaps the best compliment he could have paid to Ballmer.

Benjamin J. Romano: 206-464-2149 or bromano@seattletimes.com

This story, published March 7, 2008 was corrected on March 15. Microsoft CEO Steve Ballmer's infamous "Developers! Developers! Developers!" chant came at a different event than the running, leaping dance routine, which was at an internal company meeting. The original version of this story conflated the two events from early this decade. While both performances contributed to his "Monkey Boy" persona, they were at separate events.