Raikes reflects on 26-year run at Microsoft

Jeff Raikes, the Microsoft executive most closely associated with the emergence of Office, said that the rise of that product is clearly the highlight of his long career at the software maker, which will come to an end in September.

In an interview on Thursday, Raikes noted that Office didn't exist when he left his role as a Visicalc engineering manager at Apple in 1981 to join Microsoft. Now it has more than 500 million users, while Microsoft has grown from 100 employees to 70,000.

"It's been an incredible 26 years," Raikes said. "I couldn't be more proud of my team and where we've been able to take the business...I've truly lucked out."

To replace Raikes, Microsoft has gone with an outsider, former Macromedia CEO Stephen Elop, who was head of sales at Adobe following that company's 2005 acquisition of Macromedia. Most recently, he was at Juniper Networks.

Elop's hiring is certainly interesting in a time of growing competition between Microsoft and Adobe. Microsoft has come out with its Expression line of design software and its Silverlight software directly targets Adobe's Flash in the market for Web graphics.

The transition also comes at a time when Microsoft's traditional way of doing business is undergoing significant changes. Rivals such as Salesforce.com are offering business software over the Internet, as is Google in the consumer space.

Raikes has been among those championing Microsoft's response, which it calls "Software plus Services," in which it argues both businesses and consumers are best served by technology that can run either locally or from the Internet cloud. He has also been leading his unit's push into unified communications, where Microsoft is hoping the convergence of voice and data networks will allow it to grab a significant chunk of the business telephony market.

For now, though, Office and related products still account for 90 percent of the business division's revenue, according to Microsoft's most recent annual report. In fiscal 2007, the unit saw its revenue climb to $16.4 billion, up 13 percent from the year earlier.

Ever the optimist, Raikes said it was hard to pick a roughest time in his long run. (We might have picked something from the company's long antitrust battle, but hey, that's us.)

Raikes said that he had been talking with CEO Steve Ballmer about his departure for quite a while. "Steve and I have been talking for some time" about when best to retire, Raikes said, saying that the hiring of Elop came after Raikes had made his decision to step down.

Raikes said he hasn't decided on what's next, saying he planned to focus on Microsoft until he leaves this fall.

"I've made no decision, but it would likely (be) outside tech, something fairly different," Raikes said. As for the company he will leave, he said he is confident Microsoft is headed in the right direction--Google Apps notwithstanding. "Sure there will be curveballs that will be thrown at us...I think we'll hit them out of the park," he said.

Update: Meanwhile, strategy executive Charles Fitzgerald is also leaving Microsoft, as noted by Mary Jo Foley.

Fitzgerald is headed to a start-up, we hear. That makes three departures this week, with news Wednesday that deal chief Bruce Jaffe is also heading out.

CNET News.com's Michelle Meyers contributed to this report.