Why I Respect Bill Gates and Microsoft

Microsoft is the 800-pound gorilla in the technology world, and it takes a lot of hard work to avoid using their products if you do any kind of computing at all. But here, at a combined conference which is about 80% dedicated to Microsoft developers (the other 20% being about speech recognition technology), the Microsoft effect is truly overwhelming. We drink Microsoft Water, breathe Microsoft Air, and get our sunlight through Microsoft Windows (sorry, couldn't resist).

My own bias is to try to be as cross-platform as possible. In my company, we actively use just about every major OS: Windows, MacOS, Linux (several flavors), Unix, and Solaris. We've made a conscious effort to ensure that our product is usable on every platform feasible, which is relatively easy since we use a Web-based interface. So I'm not quite used to being steeped in the Microsoft Everywhere ethos.

As much as I think Bill Gates is a poor public speaker, and as much as I disagree with some of Microsoft's business practices (and the EU agrees), I also have a lot of respect for both the man and the company.

Unlike many technology executives today, Bill Gates is clearly not motivated simply by the desire to be filthy rich. I have a vision of him, late at night, giggling in bed with his wife Melinda. "World's richest man!" he sniggers. "Can you believe it? Me?!" Rather, I think Gates is someone who is passionate about technology--his own in particular--and was smart enough and lucky enough to hit the biggest economic revolution in a century dead-on. Rather than try to establish a dynasty and raise kids like Paris Hilton, Gates plans to give nearly all of his fortune back to the community and leave his kids with a relatively modest sum (Gates himself inherited something like a million dollars from his parents).

Microsoft is also relatively unique in the technology business in that it is willing to copy good ideas from other companies. Many people hate this (after all, how do you compete against Microsoft?), but it is far better for the industry and customers than the Not Invented Here syndrome which was pervasive pre-Microsoft. Even today, a lot of companies which should know better resist incorporating ideas and technology which weren't developed internally.

Gates has the unique ability to surround himself with really smart people who aren't afraid to challenge his ideas, and he is willing to change his mind and strategy. In general, executives tend to be narcissistic and often surround themselves with yes-men who feed their egos. Bill Gates knows he's a geek, and has no need for anyone to tell him how great he is.

Finally, Bill Gates has done something which very few people manage to accomplish: he has led a company from a handful of people to one of the world's largest (and wealthiest) companies. Different stages in a company's growth demand very different management tools, and there are hundreds of examples of companies which failed because they couldn't cope with their growth. Gates has successfully adapted to every stage from startup to world domination.

All that said, I still think that Microsoft has a bad habit of abusing its market position and intentionally crushing companies which don't pose much of a competitive threat. This is not only rude, but bad for the industry long-term, because it discourages innovation.

Deep down, I think Microsoft does not view itself as a monopoly (even though it clearly is, in several markets); or where it acknowledges its dominance, it views that market position as extremely fragile (even though it clearly is not fragile at all). Microsoft still thinks of itself as a scrappy little startup fighting for its life against other scrappy little startups. Many of Microsoft's most obnoxious anticompetitive behaviors are perfectly acceptable in a small company without a dominant market position.

But when you're the biggest by an order of magnitude, the rules change. Actions which are OK when you have 10% market share are illegal when you have 90%. At a deep level, Microsoft doesn't understand this. The notion of a level playing field is meaningless when one company is a thousand times the size of its competition.

I'm a great believer in the Law of Cosmic Irony in Business, which states that a successful company's greatest strength will eventually become its weakness. In the case of Microsoft, the perception of Microsoft as a corporate bully is likely to lead to additional antitrust actions (which may even lead to a breakup, as almost happened once before), and a bias among some people to use Anything But Microsoft.

In a very real sense, Microsoft's monopoly is fragile, since there are viable alternatives. But Microsoft's focus on external competition has blinded it to the damage it inflicts upon itself when others don't trust Microsoft.

But that's a topic for another article.