The Fall of Goliath?


Personal History

Wiiliam Henry Gates, III was born in 1956 and grew up in suburban Seattle near Lake Washington. Trey, as he was called as a child, was raised with his two sisters, Kristi, a year older and Libby, nine years younger.5 His father, Bill Sr., is a retired lawyer and his late mother, Mary, was known for her social as well as business skills.5 She served on many boards (University of Washington, United Way, etc.) and when she died in 1994, the avenue leading into her neighborhood was named after her - courtesy of the city council.5

Mary is not the only member of her family to have a landmark named after her. Gates and his best friend, Paul Allen, have their names on the new science center at their old school, Lakeside.5 Gates began attending Lakeside, an elite private school, after elementary school because his parents believed his curiosity was too great to be quenched in public schools.5 Gates was competitive even as a child and his family fed that competitive streak on their vacations.

"On Saturdays there was a tennis tournament, and on Sundays our Olympics, which were a mixture of games and other activities. Trey was more into the individual sports, such as waterskiing, than the team ones," said Bill Sr.5

His competive vacations did not end when he grew up. Gates and his wife of three years, Melinda, continually organize vacations for their friends that involve marathon bridge games, trivia quizzes and 1,000 piece puzzles.5 Melinda and one-year-old daughter Jennifer have been credited with rounding out Gates. He now adds singing lessons to his list of activities.

"I used to think I wouldn't be all that interested in the baby until she was two or so and could talk. But I'm totally into it now," said Gates.5

At Lakeside, Gates found a conducive atmosphere for his competitive nature. Together with Allen, he learned BASIC and produced two programs in the eighth grade. They spent their evenings helping a local business by finding bugs on the company's new computer in exchange for time to use it.5 In 10th grade, Gates was teaching computer skills and wrote a program for class scheduling. Another friend, Kent Evans, joined the duo in their programming work and the three formed the Lakeside Programmers Group.5 Soon they had a job creating a payroll system for a firm in town. They also analyzed and graphed traffic data for the city.5

A few years later, Evans was killed in a mountain-climbing accident. The death hit Gates hard and afterwards strove to maintain his friendship with Allen that much more. After graduation Gates went to Harvard and Allen continued programming. Eventually Gates dropped out to join him and Microsoft was born.

Microsoft

Microsoft began in 1977 with Gates and Allen writing BASIC for the first PCs.2 Allen was the visionary and Gates was the competitive workaholic.5 In 1980, Microsoft began to grow and Gates set the ground rules. He said that Microsoft must always have enough money to run for a year without revenues. As of January, the company had $8 billion in cash and no debt.5 His personal drive is readily apparent on the Microsoft "campus."

"The personality of Bill Gates determines the culture of Microsoft," said Nathan Myhrvold, a friend of Gates.5

Gates holds two-to-three meetings a day with different development teams and sends out 100+ e-mail messages a day. He encourages conflict among his employees. He enjoys it when they challenge him and they find it an honor when he responds with his favorite phrase, "That's the stupidest thing I've ever heard."5

The Breakup of a Giant?

While Gates enjoys the competition within his company, he is not so lienant on that which comes from the outside. Rob Glaser, a former Microsoft executive, describes Gates as "relentless."

"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," said Glaser.5

With quotes such as, "I want to put something in our product that's hard for Navio to do" and "The strategic goal here is getting Windows CE standards into every device e can," it is no wonder he has gained more enemies than friends.5 There are sites set up on the internet dedicated to "destroying Bill Gates," companies and lawyers filing suits against him and other computer executives who fume at the sound of his name.5 One enemy, Oracle CEO Larry Ellison, barely even speaks to Gates anymore for fear of Gates stealing his ideas.7

All of this negative publicity was bound to lead somewhere. And it did - straight to the federal government. Joel Klein, head of the Justice Department's antitrust division, calls Microsoft a monopoly that is competing unfairly against Netscape. Klien said Microsoft insisted that PC makers combine Internet Explorer (Microsoft's browser) with Windows 95.4 Compaq computers said when they tried to pre-install a Netscape icon on their Windows-based computers, they received threatening letters from Microsoft to replace the icon with Explorer's or lose the rights to use Windows.4

Wintel (Windows software and Intel chips) controls 80 percent of the PC market and Klein intends to investigate the partners. He also questions Microsoft's $150 million investment in Apple Computers.4

Microsoft responds that they are a sought after product and should be allowed to package their technology in any fashion to give buyers what they want. Gates has been quoted as saying that the suit will fail and his company will never pay a fine.4 However, Attorney General Janet Reno is in full support of Klein with his request that the courts charge Microsoft $1 million per day.9

"Microsoft is unlawfully taking advantage of its Windows monopoly to protect and extend that monopoly and undermine consumer choice," said Reno.9

In addition to his government enemies, Gates has several other enemies announcing their intent to fight his company. Ralph Nader organized an anti-Microsoft conference and Silicon valley lawyer Gary Reback is representing some of Microsoft's rivals (Novell, Sun Microsystems and Netscape) against Gates.4 These companies complain that Microsoft creates clones of rival systems to place in Windows when they smell a threat.4

Microsoft may not be taking the best route to avoid antagonizing its enemies. They continue to verbalize their plans to attack and demolish other companies in their typical taunting manner.4

"If you have 80 percent of the marketplace, one thing you shouldn't say is, 'Here is how we decide which people to screw,'" said antitrust professor Thomas Kerr.4

Future Plans

In between sparring with the government and arguing with his employees, Gates is keeping an eye on the future. He has been developing a digital videodisc to provide web browsing and information for TV sets. They call this device WebDVD and are approaching Toshiba as a potential investor.5

On the more personal side, Gates is putting the finishing touches on his new $40 million, 40,000 sq. ft. home on Lake Washington. The abode comes complete with a 30-car garage carved into the hillside, a reception hall overlooking the Olympic mountains and a huge private library stacked with rare books.4 Another rare part of his house is a room in the entertaining pavilion that contains a wall covered in 40-in. monitors that will display the pictures, TV shows and movies that the guests desire.

"You'll get an electric pin encoded with your preferences...as you wander toward any room, your favorite pictures will appear along with the music you like or a TV show or movie you're watching. The system will learn from your choices, and it will remember the music or pictures from your previous visits so you can choose to have them again or have similar but new ones. We'll have to have hierarchy guidelines, for when more than one person goes to a room," said Gates.4

In addition to thinking of his guests' enjoyment, Gates is beginning to think of his financial future. He wants to work at Microsoft for 10 more years and then focus on giving away his money. $10 million to each of his children and then some to charity.4 He's given $15 million to Harvard for a computer center; $6 million to Stanford and $200 million is in a foundation his father runs. Gates also believes in helping education. He donated computers and $3 million to inner-city libraries.4 Perhaps Michael Jordan's mantra that Gates likes to chant sums him up best.4

"They think I'm through, they think I"m through."

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megank@ufl.eduMegan Katovich
last revised Dec. 3, 1997
Copyright Megan Katovich