Interview with Bill Gates
By Larry Magid
Larry's LA Times Article (summary of interview)
LARRY: I want to start off by talking to you broadly about what is going on in the economy right now - the PC downturn, the general malaise of the NASDAQ over the last several weeks, and how that affects where we go forward and where we are in terms of the PC industry and then Microsoft to some extent, but mainly broader than that.
BILL: Well, the PC industry has had incredible growth over the years and we are in a period now where the actual growth is pretty small but PC sales are still up on a worldwide basis, particularly portable sales have been a very strong part of it. There is no doubt the economic situation will affect capital spending, particularly in the United States, it will make it, it will go through a cycle here, but the PC business is an absolutely gigantic business and with the new innovations that are coming it is one that we feel a bright long-term future for.
LARRY: In terms of Microsoft, you built this
company on the PC but now things are changing and there are new devices out
there. You have talked about the Dot Net strategy, you have your own operating
system for portable devices. What do you see is the emerging role of the PC as
we move forward?
BILL: The PC will be at the center of all the new
things that go on. The PC is your full screen device. And so if you want to sit
down and do your homework or study a purchase or organize a trip, the PC is
what you will use to do that. And the other devices like the smaller screen
devices, there will be times when that's all you have with you. And so if
something changes in the trip you would like to be notified on that device, if
the portfolio you've set up on your PC, there's some big variation that takes
place, you'd like to be notified on that device. And so it's purely
complimentary. We surveyed PocketPC owners and we had a 99% PC ownership
amongst that base; particularly with things like wireless, high resolution
LCD's, and the tablet PC form factor...you'll be using the PC for things that
you wouldn't have imagined using it for before. Things like reading, note
taking, facilitating a meeting where everybody in the meeting can be navigating
information in a new way. So the PC is at the center of this digital life style
and is sort of the ultimate creativity tool.
LARRY: Bill, on the Dot Net strategy, you are the
person, probably more than anybody else, who helped wean the world away
from the mainframe and it got to us to the point where people really have complete
control over their own computing. They bought their software, they bought their
hardware, if they wanted to they could never have to make a purchase. That
didn't happen, but theoretically. With the Dot Net, one person I talked to
said, "Isn't this sort of going from owning the farm to becoming a
sharecropper?" The idea that you're no longer an independent person in control
of your software, but you're dependent upon Microsoft or some other company?
BILL: The services that come through the Internet
will be important to you if you want to look up flight times, yes, you'll be
dependent on a service that does that. If you want to look at your kid's
homework assignments you'll be connecting up that way, if you want to file your
tax return. The network is the key part of why the PC is valuable. But for some
people it means not taking advantage of the richness there. You know, they think,
"Hey, let's move everything back to the center." And that's a vision
that they'd tried out several times and it's been a complete flop.
LARRY: You're referring to things like the network appliances?
BILL: That's right. What we want is the best of both. You
want to be able to work when the network's not there. You want to be able to
create documents. But then when the network is there, you do want to get at
what we call Web services that are available through it. And so in the same way
that it's nice when your electricity is running, it's nice when your water is
running, there are things that come from the center that are beneficial.
LARRY: But products like Word and Excel and
others, do you envision those always being something that people buy and own
and don't have to make any other purchases until they feel like upgrading?
BILL: Well products like Word and Excel
are part of Office. You would be able to buy them in the traditional way. Now,
but some people will think of it a bit differently. They'll think of being an
Office member and so on. On an ongoing basis any fixes, improvements, new templates
that we come up with, their membership will connect them up and let them get
all of those improvements. And so users will have a choice. It's just that our
ability to get improvements to them will be so much better than it has been,
where they'd have to go buy a box, a package of software and go through an
installation process. Here it can happen just because the Internet invisibly
lets it take place.
LARRY: Speaking of installations, there
has been
some controversy about the registration or the authentication process with
Office and Windows XP. Do you see any problems where legitimate customers may
not be able to get up and running as quickly as they might otherwise because of
the authentication issues?
BILL: That's always been the issue where you want
to prevent piracy of software. You've got to minimize the effort that your legitimate
users are going through and we think we've struck a good balance here. We did
test this in many countries, not in the United States because we know the
sensitivities are particularly higher, but we refined the program quite a bit to
make sure we were minimizing that. We live in a feedback loop. We think
we've got this right but we'll continue to hear from the customers.
LARRY: I heard you speak today about how Windows XP
is going to be really, really good and with all due respect I've been hearing
you speak for over 20 years. I'm using XP, I like it as well but
how do we know that this is going to be the reliable one? This one isn't going
to be the one that crashes the way Windows 98 certainly has and on some
people's machines. What is it about this that really makes it, the one, so to
speak?
BILL: Throughout the PC history people get more
ambitious. Ten years ago I could give a speech about how you don't
have to install applications specific printer drivers or that things would
actually print and the fonts would be the right size and people would applaud.
Today, people just take that for granted. They expect that that probably works.
So people are always raising their ambition of what they expect to get out of
the PC. Today, because of USB, people are plugging in cameras, people are
plugging in new printers and doing a lot of new things. Now, in order to really
make these demanding scenarios work, the technology base has to be richer. And
the old Windows code base that 95, 98 and ME is built on doesn't know what
applications are writing outside their memory space. And so you can have
problems that emerge many days later and not know what caused it, not be able
to prevent a widespread problem. And so this technology base is very important.
It's the technology base that our business users have had with Windows 2000 for
over a year now and the feedback there has been very strong. So as long as
people are doing new things with PC's, we'll always have to work hard to make
those easy and very reliable. But this is a big step up.
LARRY: In my testing of XP, I noticed, for example,
when you double click on the C drive instead of your files and folders, you get
an invitation to look at the Start menu. So you actually have made some
interface changes that I presume are going to be beneficial to novices. But
are you concerned that expert users or intermediate users may be a little taken
back by suddenly a change in the interface?
BILL: Every user is always taken aback whenever
you change something. And for the first couple of hours you are using XP,
people will be delighted by the new things they find there and a little bit
they'll be disconcerted by okay, the Start menu is quite different in XP than
it's been before - the color scheme, the way that the dialogue boxes look is
quite different. We do use a lot of usability testing before we get out there.
We're in a very critical phase now. We announced that our Beta 2 Windows XP is
going out to the marketplace and we're going to listen to what those people are
saying about [it]. Do we need to make some last minute fixes or [are] there enough
changes that people want that we should step back and do some significant
change. I think we've struck the balance the right way. I certainly have been very
involved in talking through the user and interface guys about some of the more
radical things that would have been too much of a change for users. I think
we've got it right.
LARRY: Is this really the biggest risk you're
taking on the consumer level in terms of the possibility of making legacy
applications or legacy hardware basically break? Are you worried about that
risk?
BILL: The risk mostly comes in when people are
trying to upgrade a system. When you have a new system and you are installing
XP applications onto, that works just great. But we really need the upgrade
scenario to be a good scenario because it's those power users who upgrade, who,
that are willing to support their friends and get the word of mouth going about
the new version. And to be honest about it, it's been the toughest thing about
Windows XP's is working with the driver anchors and including companies who no
longer ship that product. Or in many cases the companies are not around, we have
to step in and build the driver, and some of the applications that don't use
the standard interfaces. And so, fixing those ecosystem things has really been
what the biggest investment around Windows XP has been and one that there's
still work going on with.
LARRY: Speaking of upgrading, people in the 50's
and 60's used to buy cars every two years and a lot of people I know buy
computers every two years. Most people I know haven't bought a refrigerator in
the last ten years until theirs break. Are you worried about Microsoft and your
partners becoming victims of their own success creating machines that are so
good that people just don't feel compelled to upgrade periodically?
BILL: Someday it would be nice to have achieved
sort of the ultimate PC and have people at that level. But if you look at what
people do, things like going to meetings, or taking notes, or real
collaborative type things. You know, when you pick up the phone to call
someone, let's say you wanted to look at a document together. Do we make that
really simple for people to do? There's so much that this -- the best creativity
tool mankind has ever had -- has not yet achieved. So I certainly feel
that in the next five or six years as we get speech, handwriting, reading,
wireless, as we get all of these things into the design point, and where you'll
think of it as a communication tool in a completely different way, there's
going to be breakthrough hardware like the tablet form factor that contribute to
have people upgrading to new products. Because we are a software supplier, we
can imagine that you would get periods where you would change your hardware,
we'd still do our best to come up with software breakthroughs that you would be
excited enough to buy.
LARRY: But do you envision a period where there,
not the ultimate PC, but a lot of people don't buy cars every two years even
though there are cooler cars out there just because it works, why fix it?
BILL: Certainly in the next five or six years I
see the dynamic of breakthrough hardware and breakthrough applications, driving
things forward just like they have in the past.
LARRY: I want to switch a minute to the Internet.
You've been a strong advocate of free speech over the years and the freedom of
the Internet. Now that you have two kids, when you look at some of the things
on the Internet, do you worry and think about what we need to do to protect
children against certain aspects of the Net that are essentially dangerous or
uncomfortable?
BILL: Certainly this is a big issue for people
and there's blocking sites is part of it. There's also been the ability to log
what goes on in the usage and then being able to go back and review that so you
can see what is your kid's spending time on and provide whatever guidance you want
to there. The software power should be extremely helpful in both of those
things, allowing the parent to know what's going on, allowing the parent to
block out some of those things. The infrastructure to really peg every site
today is limited enough that if you're really going to prevent a kid from
seeing anything that might be bothersome at all, you'd have to have an explicit
list of the places they can go. And so they would miss out on sort of the
random web site. And parents can make that trade-off today. We don't have the
idea where you can let them go to watch the random web sites and yet be sure
they won't run into something inappropriate.
LARRY: What is your feeling about legislation that
has passed that would require the schools and libraries to install blocking
filters?
BILL: This is a tough one because the
imperfection of these blocking filters, there are people who feel that that
represents a curb on free speech. And so you have two of the values dearest to
the nation in a small way. And I emphasize it really is a small way, in
conflict where you say, "Let people speak out and not be blocked and let
people know that some political sites somehow get blocked because of these
imperfections," and then people would say, "Hey, our children's,
having control over what our children are seeing are also a very important
value." So what's the answer there? Well, better technology is part of it.
But we won't have perfect technology for this ever. There are improvements on
the way but that it's just too tough of a problem and in some cases it's a
judgment issue.
LARRY: Any areas that Microsoft you think is likely
to get into, or you'll leave that to other companies?
BILL: We're involved certainly in very rich search
software that goes in and confines things based on certain types of words. So we
create tools in this privacy area. We've been a leader in taking a
standard called P3P and building that into the browser and working with all the
constituency who think about privacy to say, "Hey, does this represent the
right balance? So because we're a tools provider, we can drawn into all these
issues. We don't have to take a political position but we try and arm people to
let them achieve whatever goal they have.
LARRY: Without rehashing the whole DOJ issue, the
bundling question obviously came up big time. And if I look at Windows XP and I
see CD burning, I see richer media players, I see Messenger, are you concerned
that by bundling that richness or those products into the operating system you
may have actually once again bring up the ire of the government or your
competitors?
BILL: Certainly it's key to consumers that
Windows improve. Windows integrates new functions in that we make those very
easy to get at. We did that with the support of the Internet, Windows XP
integrates and as you said, a lot of very important new things. If there's
anything that the people can understand in terms of common sense, that ability
to innovate is critical to why PCs are such a great tool and why they're so
inexpensive. You're right that that's part of what was attacked in the lawsuit.
It was partly, it was really one of the big issues, and there's a milestone
coming up where you'll see an appeals court ruling on that.
LARRY: As you sit around and design these products,
do you think about that. I mean, is that a part of your conscious, "Oh my
God, we'll put this in and we're going to get slapped by this judge or this
attorney or this competitor?
BILL: The precedents around the so-called
technological design are all 100% clear that companies are encouraged to
innovate and do the kinds of things we do. And so we've always said that we're
full speed ahead doing these improvements and making sure that we have the
right openness so that other people can bring improvements in as well. I mean
that's part of the beauty of the PC structure is, nobody has to have permission
from Microsoft to write a Windows application. They can do as they choose.
LARRY: When you're developing software, how do you
make that distinction between when it's good enough or when it needs more time?
One company, as you know, just last week shipped an operating system without CDRW support. Obviously you have to meet deadlines, but how do you deal with
that issue of, "My God, if we just had another week it would be better, it
would be stable and we'd have this feature in?"
BILL: Typically, when you get to the end the
next, you're not going to put an extra feature in in a week because you have
many months at the end which are totally about stabilization, compatibility,
testing. And so the decision about what level of features to put in, at least
for us, is something that comes at the latest, three or four months before you
might put the product out. Well, actually, there's a couple of features that
are right on the edge in terms of Windows XP and it depends on the progress
they make which of those will actually get in. It's the broad user feedback is
your most important mechanism there. Certainly we don't, in terms of our
financial situation, have to think about "Let's make this quarter or that
quarter." We can take a very long-term view and say, "Hey, what's the
best thing for the user, what's the best thing for the industry?" In
Windows XP, we have been extremely patient to get this thing right and
depending on how we hear from Beta 2, if we need to be more patient, we'll do
whatever it takes.
LARRY: How do you react emotionally when you ship a
product and you hear bug reports? How does that make you feel?
BILL: Whenever you ship a product you have been
very personally involved in it, so seen it going out in high volume, hearing
back from users who like it, who say, "Hey, this is a neat feature."
That whole feedback which is so incredible in this PC industry really is what
motivates our designers. And when they hear that they didn't get a feature
quite right or they missed a problem, certainly they feel bad about that. We
now have the idea of Windows Update to get fixes out to people very rapidly.
But our goal is that nobody run into those problems and I think if you look
over the years we have raised our standards, year by year, to higher and higher
levels.
LARRY: Bill, what do you look for in the future,
both for you personally, for Microsoft and for the whole technology world?
BILL: The dream of the PC and how it can be this unbelievable
tool, that's what got the company going 25 years ago. It was about the role of
software and the empowerment of software. And I think we're about half-way
toward achieving that dream. And I look at that in many ways, the kinds of
things people can do with PC's today, the number of PC's that are out there, I
think that over the next decade we can achieve most of that dream. And so for
me personally, working with the smart people, coming out with breakthroughs
like Tablet PC's that is sort at the top of my list right now, although that's
a year away, it's one that we're working super hard on. Things like that really
remind people that there never has been an industry like this and everybody
that is involved in it is very lucky to be so.
LARRY: I know you've been asked this before but it just
fascinates me. Here you're a guy obviously who doesn't need to work to make a
living, but you work extremely hard. What motivates you? What really keeps you
going?
BILL: I must enjoy my work because there's no,
nobody forcing me to do it. The team that we have at Microsoft, the work I've
done with Steve Ballmer over an incredible period of time and the technical
abilities in those groups, and really thinking about these hard problems and
then seeing when we get it right, and we get the feedback when we get it wrong,
we get the feedback, you know, that's a lot of fun. And you can go around the
world and see people using these products in some pretty amazing ways. It's not
just a product for rich countries, it's not just a product for businesses, it's
a product that is out there and health care, out there in every part of the
world that you can imagine. The fact is that it's a cup half full, and that's
what makes it fun to drive forward.
LARRY: One last question. We're in California, we've
got an energy crisis. PC's are enormous energy consumption devices. What are
we looking forward to in terms of instant on true energy consumption savings?
BILL: This whole power issue is one that we've
really focused in on because when we think about this tablet PC device, you
want to take it away and use it all day long and not have to go back and
recharge it. And that means really studying when can we shut off components and
yet do it in such a way that when the user wants the device, it comes right
back for them. There's huge improvements in terms of boot time and resume time
in Windows XP, and so be much more aggressive about letting things power down
becomes far more practical. One of the tougher things is the hard disk, that
when you power down the hard disk, it takes even with a good hard disk six or
seven seconds before it spins back up, and we're really getting to the point
where that is the key factor. That the other things in terms of device
initialization, software start-up, we've reduced those enough that that hard
disk is sticking through and so we're hoping that there will be some
breakthrough that can even bring that down as well. So PC's certainly, we can
do a lot and it's important to do a lot to cut down power usage.
LARRY: Bill, thank you very much.
BILL: It's a great pleasure.