Nadella's former role in Microsoft's Online Services Division meant he oversaw technical strategy for much of its cloud infrastructure. Since joining that division in April 2007, he had helped launch Bing and implement the massive search-and-advertising deal with Yahoo. Before that, he led Microsoft Business Solutions and worked on the engineering side of its Server Group.
"In deciding who should take the business forward, we wanted someone with the right mix of leadership, vision and hard-core engineering chops," Microsoft CEO Steve Ballmer wrote in a Feb. 9 e-mail to employees. "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."
Ballmer had apparently considered a number of internal and external candidates before choosing Nadella, who will replace Bob Muglia.
"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," Nadella wrote in a Feb. 9 e-mail to Server and Tools Business employees. "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 ... enabled in the cloud."
Back in January, Ballmer announced that Muglia's departure would herald the Server and Tools Business' "move forward into the era of cloud computing," one that would apparently require "new leadership."
Microsoft's all-in cloud strategy will take multiple forms: in addition to online productivity platforms such as Office 365, and cloud-ported entertainment via Xbox Live, Ballmer has publicly envisioned a future in which businesses subscribe to cloud-based services in place of maintaining exclusively on-premises solutions. Microsoft is apparently using its experience running massive cloud services such as Bing and Hotmail to inform how it builds out its other cloud platforms in the coming quarters and years.
Nadella's hire clearly reflects that cloud drive, and his management will help determine how effectively Microsoft operates in this emerging paradigm against the likes of Google and Salesforce.com.