During the Cold War, pundits entertained themselves with a parlor game called Kremlinology. Every time a Soviet premier was ousted or a new man joined the Politburo, Western analysts spun fresh theories about who was up, who was down, why the chairs were being rearranged, and what those wily old Russians were up to. The triumph of capitalism spoiled the old game but replaced it with a new one: corporate Kremlinology.

The most Kremlin-like of corporate headquarters, in the eyes of many conspiracy theorists, lies in Redmond, Wash. Last week's announcement by Microsoft CEO Bill Gates that he is turning over his job to his deputy, Steve Ballmer—and assuming the new post of "chief software architect" instead—has set Kremlinologists abuzz. Here's how Microsoft is spinning the handover and how cynics are reinterpreting those spins.

1. Gates is meeting Microsoft's challenge. At a press conference Thursday, Gates and Ballmer denied that the handover was prompted by America Online's merger with Time Warner. Instead, they linked Ballmer's promotion to Microsoft's new strategy of focusing on "Next Generation Windows Services," which are supposed to become the platform for all devices that communicate through the Internet. "We have Bill now focused 100 percent as chief architect of this transformation," said Ballmer.

Cynics' translation: He's acknowledging Microsoft's mess. Skeptics don't care whether Gates planned the handover before the AOL merger. They interpret the "next generation" strategy, Gates' assignment to it, and his adversarial references to AOL as a belated concession that AOL was right about the primacy of the Internet, Microsoft was wrong about the primacy of the PC, and Microsoft now has to play catch-up. And why is Gates going back to supervising software development? Cynics figure that if Capt. Kirk takes over the engineering room, it means Scotty has botched his job.

2. Gates is doing what he does best. On the Today show, Gates said software architecture is "a job that draws on my strengths more." Microsoft Vice President Jeff Raikes agreed that the new job puts Gates "in his element." The company's overall message is that the "next generation" project will determine the industry's future and that Gates is the genius who can pull it off.

Cynics' translation: He's sinking back to his level of competence. If Gates is better at what he'll be doing next, then he must have been worse at what he was doing before. Critics link this point to the Peter Principle, which holds that everyone rises to his level of incompetence. They suggest that being CEO was Gates' level of incompetence and that he's going "back to the garage," where he belongs. They attribute all Microsoft's missteps to Gates—bad PR, bad legal strategy, underestimation of the Internet—and infer that Gates must have been bad at everything Ballmer is good at: administration, finding new revenue sources, and avoiding bad investments.

3. Gates is psyched up. "I'm returning to what I love most—focusing on technologies," Gates said Thursday. "Steve's promotion will allow me to dedicate myself full time to my passion—building great software and strategizing on the future." On Today, Gates said his new job would be "more fun."

Cynics' translation: He's burned out. Again, critics invert Microsoft's spin: If Gates needs a new job in order to have fun, he must hate his current job. Some say he lost interest because he made too much money and has nothing left to prove. Others say the antitrust siege, the attendant PR damage, and constant media scrutiny have worn him out. A few offer the ultimate macho corporate insult, speculating that he wants "more time to concentrate on his family." But the condescension of these ill-wishers is trumped by the contempt of those who say Gates is too coldblooded to put his family first.

4. Gates is getting a puppy dog. The media always look for contrasts. Since Gates is a nerd, they've cast Ballmer as a frat boy. While Gates and Ballmer stress their similarities, Microsoft optimists and Ballmer supporters spin the nerd-frat boy dichotomy as a good thing: Whereas Gates understands gadgets, they suggest, Ballmer understands people. He's "outgoing," "affable," "tactile," and "back-slapping." He's a "salesman" who can help Microsoft by focusing on customers. He's a deal-maker who can break the ice with Justice Department negotiators and settle the antitrust case. He's the puppy who can go for a walk with his master, wag his tail, win over strangers, and help Gates make friends.

Cynics' translation: He's getting an attack dog. Sure, say the critics, Ballmer is tactile and outgoing—like a pit bull. They call him "ruthless," "bombastic," "in-your-face," an "aggressive hardliner," a "bulldog," and a "hit man." Ballmer played into this critique in Thursday's press conference, calling the notion of breaking up Microsoft "reckless and irresponsible" and dismissing speculation about such a plan as "ludicrous." Reporters deemed his tone "strident" and belligerent. Gates isn't unleashing Ballmer to make friends, the cynics argue. He's unleashing Ballmer to fight and intimidate Microsoft's enemies.