PART 9: Personal Life :- Bill Gates -III
The criticism is not just that he is successful but that he has tried to leverage, unfairly and perhaps illegally. Microsoft's near monopoly in desktop operating systems in ways that would let him dominate everything from word processing and spreadsheets to Web browsers and content. The company is integrating its Internet Explorer browser and Microsoft Network content into its Windows operating system, a process that will culminate with the "Active Desktop" planned for Windows 97, due out in a few months. Critics see a pattern of Microsoft's playing hardball to make life difficult for competing operating systems and applications: Microsoft Word has been buggy on Macintosh operating systems, users have found it tricky to make Netscape their default browser when going back and forth from Windows to the Microsoft Network. and application developers have complained that they don't get the full specs for new releases of Windows as quickly as Microsoft's own developers do.
"They are trying to use an existing monopoly to retard introduction of new technology," says Gary Reback, the Silicon Valley antitrust lawyer representing Netscape and other Microsoft competitors. The stakes are much higher than whose Web browser wins. Netscape is enhancing its browser to serve as a platform to run applications. "In other words," says Reback, "if Netscape is successful, you won't need Windows or a Microsoft operating system anymore." On the other hand, if Microsoft is allowed to embed its Web browser into its operating system in a manner that maintains its monopoly, Reback warns, "where will it stop? They'll go on to bundle in content, their Microsoft Network, financial transactions, travel services, everything. They have a game plan to monopolize every market they touch."
Gates makes no apologies. "Any operating system without a browser is going to be f out of business," he says. "Should we improve our product, or go out of business?" Later, on his trip to Japan, he returns to the subject in a two-page E-mail. "Customers are benefiting here in the same way they benefited from graphical interfaces, multitasking, compressions and dozens of other things," he writes. "If improving a product based on customer input is willful maintenance of trying to stay in business and not have Netscape turn their browser into the most popular operating system, then I think that is what we are supposed to do."
Though the stakes are clear, the law (which was developed in the era of railway barons) is not. After deadlocking, the Federal Trade Commission in 1993 surrendered jurisdiction over Microsoft to the Justice Department. FTC Commissioner Christine Varney, an expert in the field, says it's hard to apply antitrust law in a fluid situation. "My concern is with the law's ability to keep pace with market conditions in fields that change so rapidly," she says. "Once it's clear a practice is anticompetitive, the issue may already be moot."
Longtime competitors raise a more philosophical issue about Gates: his intensely competitive approach has poisoned the collaborative hacker ethos of the early days of personal computing. In his book Startup, Jerry Kaplan describes creating a handwriting-based system. Gates was initially friendly, he writes, and Kaplan trusted him with his plans, but he eventually felt betrayed when Gates announced a similar, competing product. Rob Glaser, a former Microsoft executive who now runs the company that makes RealAudio, an Internet sound system, is an admirer who compliments Gates on his vision. But, he adds, Gates is "pretty relentless. He's Darwinian. He doesn't look for win-win situations with others, but for ways to make others lose. Success is defined as flattening the competition, not creating excellence." When he was at Microsoft, for example, Glaser says the "atmosphere was like a Machiavellian poker game where you'd hide things even if it would blindside people you were supposed to be working with."
It comes down to the same traits that his psychologist noted when Gates was in sixth grade. "In Bill's eyes," says Glaser, "he's still a kid with a startup who's afraid he'll go out of business if he lets anyone compete." Esther Dyson, whose newsletter and conferences make her one of the industry's fabled gurus, is another longtime friend and admirer who shares such qualms. "He never really grew up in terms of social responsibility and relationships with other people," she says. "He's brilliant but still childlike. He can be a fun companion, but he can lack human empathy." "If we weren't so ruthless, we'd be making more creative software? We'd rather kill a competitor than grow the market?!?" Gates is pacing around his office, sarcastically repeating the charges against him. "Those are clear lies," he says coldly. "Who grew this market? We did. Who survived companies like IBM, 10 times our size, taking us on?" He ticks off the names of his rivals at Oracle, Sun, Lotus, Netscape in an impersonal way. "They're every bit as competitive as I am."
"We win because we hire the smartest people. We improve our products based on feedback, until they're the best. We have retreats each year where we think about where the world is heading." He won't even cop a plea to the charge that Microsoft tends to react to competitors' ideas--the graphical interface of Apple, the Web browser of Netscape-more than it blazes new trails of its own. "Graphical interfaces were done first at Xerox, not Apple. We bet on them early on, which is why Microsoft Office applications became the best."
Gates is enjoying this. Intellectual challenges are fun Games are fun. Puzzles are fun. Working with smart people is superfun. Others may see him as ruthless, cold or brutal; but for him the competition is like a sport, a blood sport perhaps, but one played with the same relish as the summer games at Hood Canal. He sprawls on a couch, uncoils and pops open a Fresca. Though rarely attempting the social warmth of his mother (he doesn't actually offer me a Fresca but acquiesces when I ask), Gates has an intensity and enthusiasm that can be engaging, even charming. He takes a piece of paper and draws the matrix of strategies he faced when creating applications to compete with WordPerfect and Lotus. See what an exciting puzzle it was? His language is boyish rather than belligerent. The right stuff is "really neat" and "supercool" and "hardcore," while bad strategies are
"crummy" and "really dumb" and "random to the max." His office is rather modest, sparsely decorated and filled with standard-issue furniture. The biggest piece of art is a huge photo of a Pentium processor chip. There are smaller pictures of Einstein, Leonardo da Vinci and Henry Ford, though he admits that he has little admiration for the latter. The few personal pictures include one of the original dozen Microsoft employees (most with scruffy beards, except him), one of Ann Winblad on a trip to Germany, and one with Melinda and nine friends on a 1995 vacation to Indonesia. There are no pictures of Jennifer displayed, but he pulls a snapshot out of his desk showing him proudly cradling her.
He hopes to be running Microsoft for another 10 years, he says, then promises to focus as intensely on giving his money away. He says he plans to leave his children about $10 million each. "He will spend time, at some point, thinking about the impact his philanthropy can have," Buffett says. "He is too imaginative to just do conventional gifts." Already he's given $34 million to the University of Washington, partly to fund a chair for human genome-project researcher Leroy Hood; $15 million (along with $10 million from Ballmer) for a new computer center at Harvard; and $6 million to Stanford. An additional $200 million is in a foundation run by his father, and he has talked about taking over personally the funding of Microsoft's program to provide computers to inner-city libraries, to which he's donated $3 million in book royalties. "I've been pushing him gently to think more about philanthropy," his father says. "I think his charitable interests will run, as they do now, to schools and libraries."
Asked about his regrets, Gates talks about not getting a Microsoft E-mail application to the market quickly enough. "We were too busy, and at a retreat where I wrote our next priorities on a board, everyone said I had to take one off, so we took off E-mail."
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