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Bill Gates: The Early Years in Photos
A look at the life of the Microsoft co-founder before the internet revolution
TO OUR READERS
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Bill Gates Goes Back to School
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Out of the X Box
Bill Gates’ time is valuable. There are Microsoft employees who wait their whole career to be alone ...
But big, complicated operating systems such as Microsoft's latest, Vista, aren't necessary in the Web Age, where applications are delivered for free and on demand — often without users even being aware of it. The Net is where the money is, and it's the one place that Gates-like so many others-hasn't left his mark.
He saw the Internet missile coming of course. But by the time he sounded the alarm, it may have been too late. (Read his famous "Internet Tidal Wave" memo, sent to the troops May 26, 1995, over a year after the browser company known as Netscape launched.
Gates was always more accustomed to being a disruptor than being disrupted. At the age of 25, he licensed a primitive operating system, PC-DOS, to IBM for $80,000 rather than sell it outright, a move that's usually ranked as one of the Greatest Business Moves of All Time. Gates figured that many PC makers would copy IBM's open architecture, and make their own PCs; they'd need to license an operating system, too. PC-DOS soon became MS-DOS, an operating system for all IBM clones, and Microsoft was on its way to becoming the one thing that billions of PCs around the world would have in common.
From 1980 until 1994, when Mosaic/Netscape emerged, Gates played a scratch game, parlaying his little "Micro- Soft" company into an empire that defined the PC Era. By opening up Windows to third-party developers, he created a platform that made many developers rich, and built out an eco-system that put a desktop in almost every home.
But there is no greater blinder than success, even for a visionary like Bill Gates. By the time he realized the tech world was quickly shifting from PCs to the Network that connected them, his moves were limited. A fiercely competitive man, he reached for the obvious lever, and attempted to tie the late-starter Internet Explorer browser to the monopoly he created, the Windows operating system. The move was mercilessly effective and beat back rival Netscape, which immediately saw its commanding share of the browser market disappear.
It was also illegal. With Netscape crying foul, the Feds successfully pressed an anti-trust suit against Microsoft. The PR damage-Gates acting insolent on the witness stand, showing a convenient a lack of memory about key business decisions-turned out to be short lived and is all but forgotten as Gates remakes himself as a philanthropist. But the court's decree forced the great general to march cautiously into the future. He may have won the Battle of the Browser but he would start to see major casualties in the Internet War.
Gates built or bought all manner of things to conquer the Net, but few managed to be anything more than also-rans in the innovation game. In 1995, he launched a gated online service, MSN; a Web-based email client, Hotmail was purchased in 1997; a search engine, MSN Search, launched in 1998 using a third-party product as its core; a chat client, Messenger was released in 1999; and last year it bought an online advertising platform, aQuantive and became a significant, though minority investor, in social network Facebook.
While Microsoft is exponentially larger than Google — number 44 on the Fortune 500 list versus Google at 150 — Google's web business (advertising mostly) is growing so fast, it's poised to rival Redmond's operating system revenues by 2010. And that's the problem. As more and more of what Windows does moves up into the cloud-into Google's always-on, give-'em-whatever-they-want-for-free servers-what becomes of the company that Gates built?
The smartest move Gates could make right now is to get out of the way. (Steve Ballmer should, too; pursuing Yahoo is a pretty good hint that his master plan for the Web is, like Gates's was, to try to buy Microsoft's way into the game.) There are many smart and talented people inside Microsoft who know what to do. (Blow up Vista and abandon its next iteration, Windows 7, and start from scratch, is but one excellent idea.
That will probably work. And if not? Maybe we'll see Gates return, a Nobel in his pocket, ready to wrestle with the Web once again.
