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Business Times Interview with Bill Gates
Microsoft Corporation


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Microsoft Corporation

Gates seized by vision of African sales

INFORMATION TECHNOLOGY

By SVEN LUNSCHE

IN GLOBAL terms, South Africa hardly features on the Microsoft map. Last year it accounted for a mere 0.75%, or $65-million, of the software giant's annual turnover of about $8.6-billion. The remainder of the continent south of the Sahara is even less impressive, with an estimated $13-million of global sales.

Yet Microsoft founder Bill Gates sang the praises of its local operation on his first-ever visit to Johannesburg this week.

During his visit to Soweto's Digital Village on Friday, the world's richest and most influential personality - with an estimated net worth of around $20-billion - was clearly thrilled by the enthusiasm with which the Soweto pupils tackled their PCs. The Digital Village is part of the Independent Development Trust's Thousand Schools Project and Gates announced Microsoft's backing.

It is a project which, although small, is significant in hitting home the benefit of information technology. "If there is one area where the benefits of technology really hit home, it's education. You won't find a greater enabler to develop SA," says Gates.

Microsoft is clearly reaping some healthy profits from its local operation, despite its relatively small status (27th in the group's global turnover ratings). "Microsoft SA has grown tenfold since we returned in 1992 and still produced earnings that are well ahead of those from India and China," he says.

Gates points out that in terms of one of Microsoft's key financial criteria - sales of software per PC - South Africa is in line with most developed countries. "This is a tremendous growth market for us when you consider that in the US there are 300 PC's for every 1 000 people, whereas the comparative figure here is an estimated 34 per 1 000."

Microsoft is using its local operations as a launchpad for the countries to the north. Last month it opened offices in Kenya and Ivory Coast and it plans to open 10 more in the next three years.

And despite the obvious problems of piracy - Gates estimates that up to 90% of Microsoft software in some African states is pirated - he remains committed to those countries. "Since 1994 we've experienced 50-fold growth in some of those nations."

  • A full transcript of Business Times's exclusive interview with Gates and answers to readers' queries will be available on our Website (www.btimes.co.za) during the course of the week.

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