Gates takes a step back

Bill Gates said Thursday that he will give up his day-to-day role at Microsoft in two years, heralding a momentous changing of the guard at the software giant he co-founded, which has been making significant in-roads to the entertainment industry in the past few years.

Gates, 50, wants to spend more time on his nonprofit foundation. He will remain Microsoft chairman but relinquish his post as chief software architect.

“It’s not a retirement; it’s a reordering of my priorities,” Gates said.

While Microsoft is best known for its Windows operating system, it has been pushing into several areas of the media world recently. The Xbox videogame system, launched in 2000, is now a strong No. 2 behind Sony’s PlayStation. Many observers think the Xbox 360 has a shot at beating Sony’s next-gen PlayStation 3.

Under entertainment guru Blair Westlake, company has deepened partnerships with Hollywood studios, including aligning with the HD DVD format in the high-definition DVD battle.

It’s a partner in news site MSNBC.com, though it recently sold its stake in the sibling TV network.

And company’s MSN online network has been amping up the competition with Yahoo! and Google, recently beginning to invest in original content.

It also developed Urge, a digital music service with MTV that’s integrated into its Windows Media Player software.

Gates has been ranked as the world’s richest man for many years running.

The Bill & Melinda Gates Foundation he started with his wife has assets worth more than $29 billion and is highly regarded for its work on world hunger and education.

Microsoft chief technical officer Ray Ozzie assumes the title of chief software architect, effective immediately. Craig Mundie, now chief technical officer, will take the new title of chief research and strategy officer.

(Ben Fritz contributed to this report.)

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