Update: Missteps may have hit a tipping point for Ballmer

He's been in hot water over a variety of issues, including Microsoft's position in the tablet market (see video below)

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"If Windows 8 had been a huge success and the business was growing by leaps and bounds, and Microsoft was winning share in the tablet market, there'd be a lot less pressure for Ballmer to leave," Gillen said.

Another focus of criticism for Ballmer has been what many consider a bad strategy related to the company's Office cash-cow franchise of refraining from releasing a full-fledged version of the suite for iOS and Android. Seen as a move to protect Windows, critics of this strategy say Microsoft is leaving billions of dollars on the table by not giving users of iPads and Android tablets a full version of Office.

Ballmer has also shouldered the blame for the controversial and so far not very successful decision to have Microsoft manufacture and brand its own tablet, the Surface, an attempt to mimic the model popularized by Apple with its combination of iOS and the iPhone, iPod and iPad devices.

The move has upset the company's hardware partners, because they view it as unexpected competition from Microsoft. Beyond that, the first Surface models haven't sold well.

In its fourth quarter, which closed in late June, Microsoft missed Wall Street's revenue and profit expectations while taking an almost $1 billion charge related to the dismal sales of the Surface RT, the model that runs Windows RT, the Windows 8 version for ARM chip devices.

The other Surface model, the Pro, which runs x86 chips, has been criticized for being too expensive and for being a battery hog.

"The weak performance by Microsoft in the last quarter, combined with the lackluster uptake of Windows 8 and the failure of the Surface RT -- all those things created additional pressure for Microsoft in general and for Ballmer in particular," said Gartner analyst David Cearley.

A crucial flaw for Ballmer in recent years was his disconnection from customer needs and demands, according to analyst Jack Gold from J. Gold Associates. "The disaster in tablets, the failure of Windows RT, the idea that they knew what was best for customers by ramming Windows 8 down their throats," Gold said in an email statement. "Ultimately, if you lose the focus on what your customers want, you lose."

Frank Gillett, a Forrester Research analyst, said whoever replaces Ballmer must manage the company more like a startup and less like a big company with complex metrics and processes. "The new CEO will need a strong sense of emerging business models and tech industry dynamics," he said.

In mid-July, Ballmer shook up the company's executive ranks with a broad reorganization billed as necessary to reinvent Microsoft as a devices and services company, and evolve from being a provider of packaged software.

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