Microsoft is announcing another big reorganization today, pushing the core of the company’s Windows operating system in a new direction. Windows chief Terry Myerson, a 21-year Microsoft veteran, is departing the company as Microsoft seeks to unify its artificial intelligence and core Windows OS components into a single team. Microsoft is slicing Windows into two teams. The core of what’s called the Windows platform team will be headed by Scott Guthrie, who’s currently in charge of Microsoft’s Azure cloud platform. Microsoft’s AI platform work will also move into this single team. Harry Shum will continue to lead an engineering team, AI + Research, which focuses on tech advances that can be used in future Microsoft products.

Microsoft is also creating a separate division dubbed “Experiences & Devices” that will look after Windows client releases that you see on laptops and devices, first-party apps, Office 365, and Surface hardware. Rajesh Jha, previously an Office executive, will be leading this new team as Terry Myerson departs in several months time. This team won’t manage the core components of the Windows platform, but it will handle the experiences you see on top of it like the Windows 10 shell. This is all part of Microsoft’s future vision for Windows: clever modes that run on clever hardware.

Speaking of hardware, Panos Panay, Microsoft’s Surface chief, is now Microsoft’s Chief Product Officer for the company’s first-party devices like Surface and HoloLens. Joe Belfiore is also remaining under the main Windows team, running experiences for PCs and devices. Belfiore will be responsible for sharing more of the Windows roadmap at the company’s Build developer conference in May. The Xbox unit is remaining the same, with Microsoft’s overall gaming efforts being led by Phil Spencer.

Nadella promises that the future of Windows is bright

Despite this shakeup, CEO Satya Nadella says “the future of Windows is bright” in a memo to employees. Nadella appears to be focusing the company’s core Windows efforts, Azure, and IoT devices into a team that will infuse artificial intelligence into them. At the same time, Microsoft is also creating an AI and Ethics in Engineering and Research (AETHER) Committee, which will bring the company’s senior leaders together to discuss policies on how to handle AI issues in what the company calls a “responsible way.” Harry Shum and Microsoft’s chief legal officer, Brad Smith, have created this committee.

It’s hard not to see this new shake-up as a major change for both Microsoft and Nadella, and another sign that Windows is more valuable to Microsoft’s future AI and cloud businesses than it is in its current form. It’s also another sign of Microsoft capitalizing on its growth: cloud, enterprise services, and AI. The true future of Windows will now be shaped by being paired to Microsoft’s future cloud efforts, and the company will have to balance out the consumer / enterprise needs along the way.

Microsoft has struggled with consumer services, hardware, and obviously its failed Windows Phone efforts. Last year, Microsoft started clearly pulling away from consumer-focused efforts in a bigger way. The software giant killed off Groove Music, its streaming music platform, in favor of Spotify. Kinect is officially dead, and Microsoft also finally confirmed the death of Windows Phone, too. Microsoft is now focusing on iOS and Android apps, and attempting to make those mobile devices work better with Windows 10.

We haven’t seen those efforts fully emerge yet, but Windows 10 got two big updates last year that focused on Mixed Reality, creating in 3D Paint, and pen / touch improvements. Universal Windows Apps were supposed to be the future of Windows across multiple devices, but now the true future of Windows looks like it will understandably help the company’s cloud and AI efforts while trying to adapt for a future where PCs are a lot different.

Here’s Terry Myerson’s memo to the Windows division: