U.S. & World News

REDMOND, Wash. (CBS News) ― Microsoft Corp. Chairman Bill Gates said Thursday he will transition from day-to-day responsibilities at the company he co-founded to concentrate on the charitable work of the Bill & Melinda Gates Foundation.

Gates, 50, will continue as the company's chairman after transferring his duties over a two-year period.

"This was a hard decision for me," said Gates, who founded the world's largest software company with childhood friend Paul Allen. "I'm very lucky to have two passions that I feel are so important and so challenging. As I prepare for this change, I firmly believe the road ahead for Microsoft is as bright as ever."

Ray Ozzie, Microsoft's Chief Technical Officer, will immediately assume Gates' title as chief software architect and begin working with Gates on overseeing all software technical design.

Chief Technical Officer Craig Mundie will immediately take the new title of chief research and strategy officer and will work with Gates in those areas. Mundie also will partner with general counsel Brad Smith to guide Microsoft's intellectual property and technology policy efforts.

"Gates is extremely passionate about his foundation. He's not just a philanthropist; he's someone who really wants to get in there and make a difference with his mind and his money," says CBS News technology analyst Larry Magid. "If he can put the same skills and talent and energy that he put into one of the world's most influential companies into solving some of the world's most serious problems, that's good for everyone."

Gates is ranked by Forbes magazine as the world's richest man, with an estimated wealth of about $50 billion. That great wealth, he said, also brings great responsibility, and he repeated his often-spoken desire to give away the bulk of his fortune to charity. The Gates Foundation focuses on education and global health needs.

"Just as Microsoft has taken off in ways I never expected, so has the work of the foundation," he said.

In January 2000, Gates assumed the role of chief software architect and Steve Ballmer took over the role of chief executive officer. Ballmer remains responsible for all day-to-day operations and the company's business strategy.

The world "has had a tendency to focus a disproportionate amount of attention on me," Gates said, when in reality, Microsoft is a company with an extraordinary depth and breadth of talent.

"Our leadership team has never been stronger," he said.

"Bill and I are confident we've got a great team that can step up to fill his shoes and drive Microsoft innovation forward without missing a beat," Ballmer said.

Under Gates, Microsoft has grown to more than 61,000 employees in more than 100 countries. It generates almost $1 billion in profits every month, reports CBS News correspondent Anthony Mason.

Gates and Allen started Microsoft in 1975. Gates took Microsoft public in 1986 and was the company's chairman and CEO until 2000, the year he and his wife formed the Bill & Melinda Gates Foundation, whose assets now total $29.1 billion.

"Microsoft is going to survive Gates' departure form his day-to-day responsibilities. This is a company that has a large cadre of executives and experienced software architects, including Ray Ozzie, who is highly regarded both inside and outside Microsoft," Magid says.

For the past six years Gates has focused on Microsoft's software development as the company's chairman and chief software architect.

Ozzie, 50, worked on the first electronic spreadsheet, VisiCalc, in the early 1980s. In 1983, he joined Lotus Development Corp., Microsoft's archrival at the time, to develop Lotus Symphony, a business software suite.

He later founded Groove Networks, where he developed Groove Virtual Office. Microsoft acquired Groove Networks in April 2005 and named Ozzie chief technical officer.

Mundie, 56, joined Microsoft in 1992 to create and run its Consumer Platforms Division, which was responsible for non-personal computer software. Mundie also started Microsoft's digital TV efforts. His current responsibilities include global technology policy and a variety of technical and business incubation efforts.

Ozzie and Mundie will continue to report to Gates. At an unspecified time during the two-year transition period, they will shift to reporting to Ballmer.

The news was announced after financial markets closed. Earlier, shares in Microsoft rose 19 cents, or 0.87 percent, to close Thursday at $22.07 on the Nasdaq Stock Market. Shares lost 10 cents in after-hours trading.

(© 2006 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)