Bill Gates to Microsoft: Spin Off Xbox if You Want, Don't Sell Bing

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Bill Gates during an interview on Fox Business on May 6, 2014.

By Adario Strange2014-05-06 21:11:44 UTC

Microsoft co-founder Bill Gates may have turned his attention toward philanthropy, but he still serves as the software giant's technology advisor — so his words on the future of the company carry weight.

Such was the case on Monday during an interview on Fox Business when Gates was asked about the possibility of spinning off Microsoft's Xbox gaming business and Bing search business.

See also: Move Over, Bill Gates: Steve Ballmer Now Biggest Microsoft Shareholder

Gates mostly deferred to Microsoft's new CEO, Satya Nadella, whom he believes is "off to a great start." But Gates also said he would "absolutely" support spinning off the Xbox unit if Nadella decides to go in that direction.

"We're taking PC gaming, Windows gaming and Xbox gaming and bringing those a lot closer together," said Gates. "So I'm sure Satya and the team will look at that and it's up to them. We're going to have an overall gaming strategy, so it's not as obvious as you might think."

Microsoft has been under pressure from analysts and shareholders alike, including the company's co-founder, Paul Allen, in recent months to sell off its gaming and search units due to concerns that the two businesses aren't generating enough profit. So while Gates didn't actually say that the Xbox gaming will be spun off, his comments indicate that it's a distinct possibility.

Microsoft's head of communications, Frank X. Shaw, took to Twitter to tamp down speculation about the future of the company's gaming unit:

Gates' approval for a possible Xbox sell-off of the Xbox business is likely to add to pressure on Nadella to get rid of the gaming unit. But based on Gates' comments, shareholders hoping for a sell off of Microsoft's Bing unit may be in for a disappointment.

"The Bing technology has been the key to us learning how to do large scale data centers," said Gates. "I see [Bing] as a pretty fundamental technology for the company, even for its Office business, it's a very, very core business … We're thinking about 'are there pieces that are separable,' but for our basic research, including the stuff that goes into Bing, I can't see that making sense to break it off."

Gates also took a moment to weigh in on Bitcoin, mirroring the mostly negative view on the currency held by his friends, Berkshire Hathaway's Charles Munger and Warren Buffett, who were sitting nearby during the interview.

"Bitcoin is mostly about anonymous transactions, and I don't think over time that's a good way to go," said Gates. "I'm a huge believe in digital currency ... but doing it on an anonymous basis I think that leads to some abuses, so I'm not involved in Bitcoin."

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Topics: Apps and Software, bill gates, bing, Bitcoin, charles munger, charlie munger, Gaming, Microsoft, Paul Allen, search, Tech, Warren Buffett, xbox 360