Microsoft developed its first Surface tablet more than a decade ago under strict secrecy to give then-CEO Steve Ballmer the option to pull the plug shortly before it launched if the company’s PC partners objected.
Yet the company needed top hardware engineers to devote themselves to the project. Mike Angiulo, the former Microsoft executive who was secretly in charge of the project under then-Windows chief Steven Sinofsky at the time, solved this dilemma with a strategic recruit from another part of the company.
“How do you convince people to pour their hearts and souls into something that could ultimately be thankless?” Angiulo said this week. “You hire Panos Panay.”
Panay, who left his role as Microsoft’s chief product officer on Monday, is known for obsessing publicly over the details of the company’s Surface devices and other hardware products during launch events, which he has a habit of starting by declaring how “pumped” he is to be showing the team’s latest creations.
That attention to detail has also defined Panay’s management style off-stage, in his day-to-day role at Microsoft, according to several people who worked with him at the company over the years.
Such an approach, especially when combined with a certain intensity, can raise the risk of making people feel micromanaged, and it may not be for everyone.
But former colleagues said Panay has a knack for making people working on even the smallest parts of a project feel valued. He sees and appreciates the nuances of what they’re doing, and how it contributes to the larger whole.
“If I could meet with every single person in my organization, just to check on how they’re doing, I would absolutely do it,” Panay said during a virtual appearance at the 2020 Geekwire Summit, in the depths of the COVID-19 pandemic, explaining his strategy for helping members of his team adjust to the realities of remote work at the time.
In the office, former colleagues said, Panay was often the first to arrive and the last to leave.
In a LinkedIn post this week, a current Microsoft product management and marketing director, Ryan Day, recounted with appreciation a time when Panay spent 90 minutes giving him a one-on-one career counseling session: “Just me and him, during his workday,” he wrote, describing it as “a lot of time” to give someone at his level of the company.
Panay’s potential new role
But how would his style translate to Amazon?
That’s a key question after Bloomberg News reported that the e-commerce giant is poised to hire Panay to lead the division that makes its Alexa voice assistant and Echo devices. Panay would replace Dave Limp, Amazon’s devices and services chief, who said in August that he would step down this year after more than 13 years at the company.
The company has not yet commented on the Bloomberg report. Panay has yet to comment publicly beyond confirming on Twitter that he would be leaving Microsoft.
The timing is notable, with Amazon set to hold its annual Echo and Alexa product unveiling Wednesday morning in Arlington, Va. It’s not clear if Panay will make a cameo.
Microsoft, which named veteran executive Yusuf Mehdi to lead the Windows and Surface business, has confirmed that Panay won’t be appearing at its separate Windows and devices event, scheduled for Thursday in New York.
Apart from possible non-compete and trade secrets issues with Microsoft, one potential complication for Panay in accepting a new Amazon role could be his role as a board member of Sonos, which he has held since August 2020. The smart speaker maker offers Alexa functionality as part of its devices but also lists Amazon among its competitors in its annual 10K filing with the SEC.
Panay, who was 50 years old as of the filing of Sonos’ proxy statement in January, has a bachelor of science degree from California State University, Northridge, and an MBA from Pepperdine University.
He joined Microsoft in 2004, working on hardware projects in the company’s Entertainment & Devices Division before he was recruited to the nascent Surface team. After working as general manager of the Surface business, his role ultimately expanded to chief product officer overseeing the Windows and Devices division, including the integration of AI into the operating system through a feature called Windows Copilot.
Microsoft has long described its Surface hardware business, including tablets, laptops and desktop PCs, as a way of creating reference designs and setting examples for other Windows PC makers to follow. At the same time, under the leadership of Panay and his team, it has became a multi-billion dollar business in its own right.
The company’s Windows and Devices businesses surged during the pandemic but declined in the company’s most recent fiscal year, which ended in June. Windows revenue fell 13% to $24.7 billion, and Devices revenue, including the Microsoft Surface hardware lineup, was down 24% to $5.5 billion.
A shot in the arm for Alexa?
From the start, Panay won high marks for his passionate and conversational approach to Microsoft Surface launch events — which in recent years sometimes included him meandering through the audience as he told the tale of the company’s newest devices.
At first glance, that would seem to contrast with Amazon’s tightly scripted events.
But Amazon’s Devices & Services team might benefit from a shot in the arm in the form of Panay’s signature enthusiasm. Along with the rest of the company, the Echo and Alexa group went through difficult layoffs last year, amid reports that the division was losing as much as $10 billion a year.
At the same time, the rise of generative artificial intelligence tools, including OpenAI’s ChatGPT, have illustrated the need for Alexa to significantly improve its conversational abilities.
Although Microsoft has discontinued its Cortana voice assistant, removing one area of direct competition between Microsoft and Amazon, a common interest in the future of AI could be a point of friction in the context of Panay’s potential new role.
Executives at both companies traditionally sign non-competition and confidentiality agreements that can limit their ability to work elsewhere for specified periods after their employment ends. Microsoft would naturally want to ensure that Panay doesn’t leverage any trade secrets in a new role.
Microsoft and Amazon went through a process of negotiation over confidentiality and trade secrets after senior Amazon Web Services exec Charlie Bell left Amazon and joined Microsoft in 2021 to lead its security division. The companies ultimately reached a truce in that situation, allowing Bell to continue in his new role.
There’s a long tradition of cross-pollination of executives, managers, and employees, between the Seattle-area tech giants, due in part to the fact that those who jump from one to another often don’t need to relocate.
Key executives who have moved from Microsoft to similar roles at Amazon in recent years include Ian Wilson, vice president of human resources for AWS; and David Treadwell, now senior vice president of Amazon’s Commerce Platform. Earlier examples included Brian Valentine, the longtime Windows executive who went on to lead engineering for Amazon starting in 2006, before retiring from that role in 2014.
We’ll have to wait to see if Panos Panay joins the list. But he’ll no doubt be pumped if it happens.
