Microsoft's growing empire gets too big for Bill Gates's comfort
The wrath of Darth Vader; Rich, yes. Popular, no. LOUISE KEHOE on the world's wealthiest man
For the most part, Gates takes notoriety in his stride. He regards his celebrity status as part of the job of running the world's biggest software company. Unless they bother his wife and baby daughter, he shrugs off the paparazzi and is unfazed by the dozens of Web sites dedicated to anti-Gates or -Microsoft jokes. Yet this week's headlines can only have irked him.
As the personification of Microsoft, he has been pilloried in the media and even more so on the Internet for alleged anti-competitive behaviour.
Microsoft was last week accused by the US Justice Department of violating a 1995 anti-trust settlement, or consent decree, by forcing PC manufacturers to install the Microsoft Internet browser on their products through threatening to revoke their licences for Windows 95.
Janet Reno, the US attorney-general, said she would seek record fines of $1-million a day against Microsoft. But so rich has Gates become that, according to one commentator, if he paid the fine personally he would not run out of money until at least 2095.
Gates is one of the best known and most admired leaders in the technology industry. He is also the most disliked. Gates bashing has become a popular pastime; just the mention of his name often raises jeers at industry conferences. Microsoft is commonly referred to as the evil empire and Gates himself as Darth Vader.
Much of this can be put down to envy or resentment of Gates's astounding wealth. Yet there is also a widespread belief that Microsoft does not play fair; that it is squelching innovation that might threaten its market leadership.
Evidence presented by the anti-trust regulators included corroborating statements from three PC manufacturers including Compaq Computer, the world's largest. On the face of it, this would seem to be a clear-cut case. Microsoft appears to have used its Windows monopoly to force customers to adopt another of its products.
Yet Gates is unrepentant. He insists that Microsoft has done nothing wrong. The browser is an integral part of Windows, rather than a separate product, he insists. As such, it must be installed on every PC that runs Windows 95. Substituting a competing browser would be like selling a Ford Explorer with a Toyota engine.
From Gates's perspective, Microsoft was double-crossed by the Justice Department. He and other executives laid out details of the company's product plans when they negotiated the 1995 settlement. Language supposed to accommodate a gradual blending of the Windows operating system and Internet browser was included in the consent decree.
But that language is being interpreted by a new generation of Justice Department officials. None of the antitrust lawyers whose names appeared on the 1995 agreement is involved in the new complaint.
Even as critics talk of enabling fair competition and creating a level playing field, Microsoft's captain sees himself in a game where the rules remain the same, but the referees have changed. Now, he believes, they are wearing the colours of the opposing side.
He is exasperated: "Should the Department of Justice decide what future innovation we can or cannot do," he asks rhetorically. "You have to control your own product. We're asking for that right . . . . A fundamental principle at Microsoft is that Windows gets better and makes the PC easier to use with each new version.
"Today, people want to use PCs to access the Internet," he adds. "It would be a great disservice to our customers if Microsoft did not enhance Windows with Internet-related features and rapidly distribute updated versions of Windows through PC manufacturers."
From a technical perspective, it is hard to fault his logic. The benefits of integrating the browser and the operating system are widely recognised. Indeed, Microsoft competitors Netscape Communications and Sun Microsystems are moving along a similar path.
Yet even as Gates talks about future products and innovation, which are his primary interests, the Justice Department is looking over Microsoft's products, sales and marketing activities of a year ago.
To Gates this is all old and irritating stuff. He has been fending off antitrust regulators for at least seven years.
For all Microsoft's success, Gates believes the company is under continual threat from new and existing competitors. He is incredulous at and angered by any suggestion he should tone down his company's aggressive tactics.
But it is precisely his intense competitive spirit that has brought him head-to-head with the government's competition regulators. In a style that reflects his mode of conversational combat, Microsoft is countering the Justice Department's charges by questioning the technical competence of its lawyers.
It is this kind of response that has given Gates and Microsoft a reputation for arrogance. Anyone that disagrees with him is lacking in intellectual capacity, he often implies. He describes criticism as random. It is difficult to explain or counter. Yet it is against this background of discontent that consumer groups are mounting a campaign against the company.
Microsoft claims to have been overwhelmed by calls and E-mails from supporters. Yet in the broader court of public opinion, the company is losing. On one popular Internet news site, readers are voting two to one against the company on the question of whether it has transgressed antitrust laws.
For all of its success in selling software, Microsoft has failed to win the hearts of its millions of customers. In some part, this appears to be a reflection of the public persona of its chairman.
Yet the private Gates is a casual, witty man. He is a charming host and generous with his time. A proud father, he has a growing interest in education as well as displaying his passion and broad knowledge of all aspects of technology.
It is his in public where he is perceived as defensive and rude that he gets into trouble. But being likeable has never been one of Gates's prime ambitions.
In any case, Gates has been here before. He emerged unscathed from the earlier antitrust charges by the Justice Department. He remains confident he can fend off this latest assault. But he deeply resents the distraction. - Financial Times