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PC World

Gates: We're just smarter, that's all

Microsoft CEO says his company doesn't dominate industry but does make better decisions than its rivals.

February 3, 1999
Web posted at: 1:33 p.m. EST (1833 GMT)

by Jana Sanchez

PARIS, France (IDG) -- Microsoft Chair and Chief Executive Officer Bill Gates argued here on Tuesday that Microsoft doesn't dominate the software industry, but that the company has made smarter strategic decisions than rivals such as Oracle and IBM.

Speaking at the first annual Forum de l'Information et de la Haute Technologie (Information and High Technology Forum), Gates contrasted Microsoft -- which he said was focused on research and innovation -- with his rivals, whom he accused of being slow to see important industry trends or unwilling to take risks.

"Oracle has an enterprise sales force in the model of IBM, but if I had been there [as Oracle chief executive] they would have been in Web servers and collaboration software. They only have databases," Gates said.

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Accusing IBM of being a truly dominant software company, but saying that it lost its way, Gates defended Microsoft against accusations that it dominates the software industry. "IBM has always been ten times our size. They are the dominant company in this industry. It's a tribute to our innovation that we've been able to compete," Gates said. (Microsoft is actually now about one-fifth the size of IBM, according to the most recent quarterly financial results.)

Gates claimed that the Microsoft Exchange collaborative software is now outselling Lotus Notes, from IBM subsidiary Lotus Development.

"Anyone who thinks this isn't a hypercompetitive business is crazy," declared Gates, apparently referring to Microsoft's ongoing battle with the U.S. Department of Justice over Microsoft's alleged anticompetitive behavior.

When asked to single out computer companies that were innovative, Gates named Compaq, Nokia, Intel and as well as Internet startups, eBay, and Yahoo. "I admire these companies," he said. "They did fantastic things. They are helping to move the Internet."

We're from the government and we're here to help PCs

Gates also lauded the French government's recent about-face on encryption policy, saying the recent relaxation of rules will promote innovation. Programs in Sweden and other Nordic countries that provide government incentives for the purchase of home-PCs were also helpful, said Gates.

"Europe has really come a long way. The awareness of politicians about technology is a new thing," Gates said. But this doesn't mean Europe will catch up with the U.S. soon, however, because Internet mania in the U.S. is at a fever pitch, he said.

Gates also reaffirmed his belief in the future of the PC, questioning the idea that PCs will become less important as other Internet access devices become more prominent. The industry, he said, has to make PCs easier to use, more powerful, and more efficient.

Microsoft's research and development efforts are what helps Microsoft compete, he said. "Many of our research projects will fail. Most large companies aren't doing really high-risk research. We have been the most aggressive, but I don't mind if some of these don't turn out," he said.

As for his own job, Gates said he would like to turn over his role as chief executive officer over to someone else and get more involved in product development at some point in the next ten years.

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