Mr. Smith

Writing Workshop II


William H. Gates is the invisible fulcrum upon which an entire industry rests.

He is the Walrus of an the industry that he scrawled into existence on that dark day of February 3, 1976.İ With a single letter he created a revolution, that led to Microsoft Behemoth of today.İ There is nothing in his history that marked him for the future he had planned for himself.İ


Born on October 28, 1955, Gates and his two sisters grew up in Seattle. Their father, William H. Gates II, is a Seattle attorney.İİ Gates' family was financially well off. His father, William H. Gates II, is a prominent attorney. His mother, Mary Gates, was a schoolteacher, a University of Washington regent and the chairwoman of United Way International, and the director of First Interstate Bank.


Early on in life, Gates' parents placed him into Lakeside, an academically challenging private school. While at Lakeside, Gates met his close friend and future business partner Paul Allen. Together they entered the world of programming at Lakeside.

At the young age of 15, Gates was able to crash the DEC operating system and the CDC, which were two of the most advanced computer systems at that time. Although his ability to crash these two systems brought him some major trouble, it also led him to his first business adventure.İ Gates teamed up with three other students to form The Lakeside Programmers Group. Their first real business deal was a payroll program they wrote for Information Sciences Inc., in 1971.İİ

Later Gates and Allen started the company Traf-O-Data, which earned them $20,000. Gates and Allen developed a machine was able to generate summary statistics on traffic flow from a rubber tube strung across a highway. Unfortunately, Traf-O-Data was not a big success. However, after their Traf-O-Data adventure the Gates and Allen received a job offer with TRW, a corporation that produced software products. They were able to earn $30,000 a year working with a software development group, which proved to be a very valuable experience for both Allen and Gates.


In 1973, Gates entered Harvard University in Massachusetts as a freshman, where he lived down the hall from Steve Ballmer, now Microsoftís Chief Operating Officer.İ While at Harvard, Gates developed the programming language BASIC for the first microcomputer -- the MITS Altair.


One of the Harvard legends was that, the cool thing to do was to slack off on classes for most of the semester and try and see how well the student could do at the end. Steve Ballmer and Gates ìtook a tough graduate- level economics course together- Economics 2010. The professor allowed you to bet your whole grade on the final if you choose"(Gates 40). They did that, did not do anything for the class all semester, and studied and got high marks. During one of these slack off periods, Gates and Allen found a very small computer: the Altair 8800 "('Altair' was a destination in a Star Trek episode)"(Gates 16). It had a few switches and lights on the front that you could get to blink, but that was about all. This new chip had great potential, but there was no way to program it. After five weeks of not going to classes, not eating or sleeping regularly, their version of "BASIC was written- and the world's first microcomputer software company was born. In time we named it 'Microsoft'"(Gates 17).


In his junior year, Gates left Harvard in 1975 to devote his energies to the nascent ìmicro-softî, a company he had begun with Paul Allen. Guided by a belief that the personal computer would be a valuable tool on every office desktop and in every home, they began developing software for personal computers.İ It was here that he made the decision that ultimately led to Microsoft becoming a household name.İ He realized that the product he created without requiring massive investments of capital and resources, and software could be infinitely sold and resold for horrendous profits.İ Ultimately it appeared that all of his graduate level economics courses eventually paid off.


On February third 1976, Bill Gates wrote the letter that is attached below and sent it to numerous groups of computer hobbyists.İ Amidst the chaos that resulted from the outcry of users, a number of commercial organizations simply paid.İ The profits garnered by this simple exercise in intellectually property rights left Microsoft in a good position to take advantage of another opportunity.


Microsoft's big economic break came in 1980 when "IBM- the computer industry leader- asked Gates to develop an operating system for its new personal computer"(Clayton 452). IBM usually did not use external help in software design or hardware manufacture, but they wanted to release the first personal computer in less than a year. "IBM had elected to build its PC mainly from off-the-shelf components available to anyone. This made a platform that was fundamentally open, which made it easy to copy"(Gates 47). IBM bought the microprocessors from Intel and licensed the operating system from Microsoft. Microsoft bought some work from another company in Seattle and hired its top engineer, Tim Paterson. The system became known as the Microsoft Disk Operating System, or MS-DOS.


Gatesí foresight and vision regarding personal computing have been central to the success of Microsoft and the software industry. Gates is actively involved in key management and strategic decisions at Microsoft, and plays an important role in the technical development of new products. A significant portion of his time is devoted to meeting with customers and staying in contact with Microsoft employees around the world through e-mail.


Under Gatesí leadership, Microsoftís mission is to continually advance and improve software technology and to make it easier, more cost-effective and more enjoyable for people to use computers. The company is committed to a long-term view, reflected in its investment of more than $2 billion on research and development in the current fiscal year.


In 1995, Gates wrote The Road Ahead, his vision of where information technology will take society. Co-authored by Nathan Myhrvold, Microsoftís chief technology officer, and Peter Rinearson, The Road Ahead held the No. 1 spot on the New York Timesí bestseller list for seven weeks. Published in the U.S. by Viking, the book was on the NYT list for a total of 18 weeks. Published in more than 20 countries, the book sold more than 400,000 copies in China alone. In 1996, while rebuilding Microsoft around the Internet, Gates thoroughly revised The Road Ahead to reflect his view that interactive networks are a major milestone in human history. The paperback second edition has also become a bestseller. Gates is donating his proceeds from the book to a non-profit fund that supports teachers worldwide who are incorporating computers into their classrooms.


In addition to his passion for computers, Gates is interested in biotechnology. He sits on the board of the Icos Corporation and is a shareholder in Darwin Molecular, a subsidiary of British-based Chiroscience. He also founded Corbis Corporation, which is developing one of the largest resources of visual information in the worldóa comprehensive digital archive of art and photography from public and private collections around the globe. Gates also has invested with cellular telephone pioneer Craig McCaw in Teledesic, a company that is working on an ambitious plan to launch hundreds of low-orbit satellites around the globe to provide worldwide two-way broadband telecommunications service.


In the decade since Microsoft has gone public, Gates has donated more than $270 million to charities, including $200 million to the William H. Gates Foundation. The focus of Gates' giving is in three areas: education, population issues and access to technology.


Gates was married on Jan. 1, 1994, to Melinda French Gates. The couple has two children: a daughter, Jennifer Katharine Gates, born in 1996; and a son, Rory John Gates, born in 1999.


Gates, declaring himself a representative of Silicon Valley, donated a large amount of money to the Clinton campaign. The support of Bill Gates boosted the popularity of the Democratic Party. This year, Forbes Magazine's traditional annual list ranked this same Bill Gates, head of Microsoft Corp., as the worlds richest human being. Myths and legends about this youthful success story abound; he has already published an autobiography which, along with a critical biography of Gates, is being read by people all over the world. He is, in short, a super-famous man. Gates rear-echelon e-mail activities have been reprinted not only in America and Europe, but even, in translation, in Japanese newspapers. Gates has been known for some time as a political liberal and a strong supporter of the Democratic Party; lately, however, the word about town is that Gates and the Democratic Party have had a falling-out. The U.S. Department of Justice under the Clinton administration, citing doubts about the legality under U.S. antitrust laws of attempted buy-outs of other companies by Microsoft, has put such purchases on hold, causing them to fall through and, it is said, greatly angering Bill Gates.


Gates, an object of admiration for most Americans as a "modern-day Rockefeller," is also, it seems, an object of envy who arouses fierce jealousy: charges are currently being brought against him for violation of antitrust laws. Simply put, the Justice Department, under the traditional notion that allowing software makers to merge with the company which makes their computer operating systems to form a single giant company is less desirable than keeping them separate, is moving to block Gates' path. Some 80% of the personal computers in the world today use the MS DOS or Windows operating systems both Microsoft products. If you purchase a piece of software, such as a word processor, and try to run it on your personal computer, you will be unable to run the program unless it is first able to connect with and operating system. Because of this judgment that it is best to keep separate that which ought to be consolidated, it is difficult to see how the Internet, or any other information network, can in future be integrated into a single, unified whole. The specter of an antitrust law born in the age of Standard Oil has risen once again to haunt us. As a rule, disputes such as this are amicably settled by lobbyists. Astoundingly, however, Bill Gates had not a single lobbyist in Washington. Absorbed in his work, it seems, he had neglected to devote any attention to lobbying activities. Then, too, his is such a new industry that it simply hadn't had time to hire lobbyists and launch a carefully planned program of lobbying activities. Thus it appears that Gates' split with the Democratic Party is a fair accomplishment.


In "The Road Ahead," a book-and-CD-ROM package, Gates "predicts the future for you" (as Newsweek's cover put it). And, surprise!, things look bright indeed to America's richest guy. The "information highway" -- Gates generally clips it to a plain "the highway" -- isn't here yet; the Internet is only a genetic precursor, according to Gates. But when "the highway" itself arrives at our doors, with its ubiquitous high-bandwidth digital video feeds, our lives will undergo a seismic change for the better.


This "World of Tomorrow" prognostication game is old enough hat that even Gates admits many of his predictions will soon look comical. The CD-ROM's video portrait of "the highway" circa 2004 -- a world of heavy makeup, bad Muzak and super-efficient cappuccino bars -- will make for good party entertainment a decade hence. So will its wide-eyed virtual-reality walk-through of the still-unfinished Gates mansion, the Hearst Castle of the '90s.


"The Road Ahead," like an AT&T ad, is built around a ritual repetition of the word "will." I used the CD-ROM's "full text search" function and, though it wouldn't tell me how many times "will" appears, it reported that the word turns up on just about every page.


You will use "the highway" to "shop, order food, contact fellow hobbyists, or publish information for others to use." You will select how, when and where you wish to receive your news and entertainment. You will benefit from lower prices and the elimination of middlemen that the network's "friction-free" marketplace allows. Your wallet PC will identify you at airport gates and highway tollbooths. Your children will tap a torrent of homework helpers.


As the CD-ROM narrator breathlessly puts it, "The information flow into your home will be incredible!" ("Get the mop, Martha!")


At some point, all these "wills" change in character from predictive to prescriptive, and Gates' friendly if cool tone acquires an undercurrent of coercion. The promise of "the highway," according to Gates, is that it will allow us all to control our destinies more fully. The not-so-well-buried subtext of "The Road Ahead," though, tells a different story -- of Gates' and Microsoft's desperate struggle to maintain control of the high-tech marketplace.


"The Road Ahead" won't satisfy readers curious for insights into Chairman Bill's psyche; it mostly has the bland, confident air of an annual report. But in its very first chapter -- next to a cute high-school picture of Gates and Paul Allen scrunched over an old teletype terminal -- Gates does give one clue to his mindset. He was attracted to computers as a kid, he explains, because "we could give this big machine orders and it would always obey."


It's easy to jump on a line like that and make Gates out as some kind of silicon-chip Nazi. But of course he's only being honest about the attraction computer science has always held for engineers, enthusiasts and precocious children: the appeal of instantly responsive, utterly submissive systems that can be gradually massaged toward perfection.


Though digital technology invites its creators into a world of absolute control, the computer market remains a place of frustrating chaos. Gates stepped away from being the visible force at Microsoft and he adopted the strategy that made Microsoft's fortune: ship early with imperfect products, seize market share and then upgrade toward an acceptable level of performance. This drives engineers nuts, but it's sharp business, and it has kept the company on top of the software industry -- until now.


Appendix 1


An open Letter to Hobbyists
İİİİ To me, the most critical thing in the hobby market right now
is the lack of good software courses, books and software itself.
Without good software and an owner who understands programming, a
hobby computer is wasted. Will quality software be written for the
hobby market?
İİİİ Almost a year ago, Paul Allen and myself, expecting the hobby
market to expand, hired Monte Davidoff and developed Altair BASIC.
Though the initial work took only two months, the three of us have
spent most of the last year documenting, improving and adding fea-
tures to BASIC. Now we have 4K, 8K, EXTENDED, ROM and DISK BASIC.
The values of the computer time we have used exceeds $40,000.
İİİİ The feedback we have gotten from the hundreds of people who
say they are using BASIC has all been positive. Two surprising
things are apparent, however. 1) Most of these "users" never bought
BASIC (less than 10% of all Altair owners have bought BASIC), and
2) the amount of royalties we have received from sales to hobbyists
make the time spent of Altair BASIC worth less than $2 an hour.
İİİİ Why is this? As the majority of hobbyists must be aware, most
of you steal your software. Hardware must be paid for, but soft-
ware is something to share. Who cares if the people who worked
on it get paid?
İİİ Is this fair? One thing you don't do by stealing software is
get back at MITS for some problem you may have had. MITS doesn't
make money selling software. The royalty paid to us, the manual,
the tape and the overhead make it a break-even operation. One thing
you do do is prevent good software from being written. Who can af-
ford to do professional work for nothing? What hobbyist can put
3-man years into programming, finding all bugs, documenting his pro-
duct and distribute for free? The fact is, no one besides us has
invested a lot of money in hobby software. We have written 6800
BASIC, and are writing 8080 APL and 6800 APL, but there is very lit-
tle incentive to make this software available to hobbyists. Most
directly, the thing you do is theft.
İİİ What about the guys who re-sell Altair BASIC, aren't they mak-
ing money on hobby software? Yes, but those who have been reported
to us may lose in the end. They are the ones who give hobbyists a
bad name, and should be kicked out of any club meeting they show up
İİİ I would appreciate letters from any one who wants to pay up, or
has a suggestion to comment. Just write me at 1180 Alvarado SE, #114,
Alburquerque, New Mexico, 87108. Nothing would please me more than
being able to hire ten programmers and deluge the hobby market with
good software.





Cook, William J. U.S. News & World Report. "A Pain for Windows." Feb. 27,1995 p64-66

Clayton, Gary E. Ph.D. Economics Principles and Practices. New York: Glencoe/McGraw-Hill 1995

Economist, The:The World This Week. March 26, 1994 p7

Economist, The: Business. January 22, 1994 p73

Fortune. June 28 1993

Gates, Bill. The Road Ahead. New York:Penguin Group 1995

Lyall, Sarah. Technos: "Are These Books, or What? CD-ROM and the Literary Industry." Winter 1994 p20-23

Quittner, Joshua. The Seattle Times. Seattle, "Electronic Peek into the Future."September 5, 1993 D1+

Rohm, Wendy Goldman. Wired:"Oh No, Mr. Bill!" April 1994. p90+

Schlender, Brenton R. Fortune. "Jobs and Gates Together." Aug. 26, 1991 p50+

Schlender, Brenton R. Fortune:"The Future of the PC." Aug 26, 1991, p40+