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Microsoft is currently reorganising itself into three main divisions, in an effort to streamline the processes of decision making and bringing products to market.

The three divisions will be:

Microsoft Platform Products and Services Division
Responsible for Windows products, corporate server products and MSN web services.
Microsoft Business Division
Responsible for software and software based services for business

Entertainment and Devices Division
Responsible for multimedia content and devices to deliver media at work, home or on the move.

As well as the three main divisions, Chief Technical Officer Ray Ozzie will be responsible for developing software based services across all three divisions. Overall it's a restructure that makes a lot of sense. It marks a move from seven main divisions to just three, and should enable more integration and co-ordination in the development cycle. It's a move which seeks to minimise the "head doesn't know what the hand is doing" aspect of operation which has played its own part in product delays and features not being ready for inclusion as planned.

The amalgamation of the OS and web-based activities puts Microsoft in a better position from which to meet the challenges in web-based service delivery posed by companies such as Google and Yahoo.

Jim Allchin, who has overseen much of the development of the Windows OS since the early 1990's, will be retiring following the release of Windows Vista next year. Windows Vista, and the later release of WinFS, will mark the realisation of the 'vision' Allchin has held for the Windows OS since 1992.