FOCUS: MICROSOFT: Why the law can't contain Bill Gates

Microsoft's legal battle will last years but don't weep for its boss

Seconds after the anti-trust judgment against Microsoft was released on Friday night, the news was powering through fibre-optic and copper cables around the world to electronic mail in-baskets and pagers. Stock traders were selling the company's shares from dealing floors, trading rooms and computers perched precariously on the dining-room table, and hundreds of thousands of copies of the document were being downloaded on to hard disks or printed out. One person, more than anyone else, made this possible: William H Gates, the man who has defined the business of computing and the New Economy of the 1990s. "If the 1980s were about quality and the 1990s were about re-engineering, then the 2000s will be about velocity," he says in his new book, Business At The Speed of Thought. "About how quickly business itself will be transacted. About how information access will alter the lifestyle of consumers and their expectations of business."

The future of this man, his vision and the company which he has built from nothing to dominate totally the computer business is now in the balance. The company is the subject of a huge competition case, and if Friday's statement from the court is to be believed, it is losing. Bill Gates himself lost $20bn, when the judgment affected Microsoft share prices. And when Judge Thomas Penfield Jackson wrote his damning conclusions about Microsoft, calling it a monopolist and charging it with a massive abuse of its power in the market, he was not speaking just of a company or a hierarchy: he was damning Mr Gates. His credibility is on trial, as much as his company, as lawyers and consumers come to terms with how one man sought to use American capitalism, and to change it in the process.

He is, in many respects, an unlikely figure to follow in the footsteps of the pirate kings of American industry, the monopolists who sought to dominate the explosive growth of American heavy industry 100 years ago. Though he is worth pounds 75bn, owns Leonardo Da Vinci's Codex Leicester and has a house worth more than pounds 31m, Bill Gates is not the man in the top hat and the frock coat, the classic capitalist. Tremulous and thin- voiced when he stood up to defend himself on Friday night he sounded less plutocrat than plebeian: more like a junior marketing executive caught out fiddling his expenses than John D Rockefeller.

But don't be fooled. The Economist has called Mr Gates a "paragon of industry" and a "ruthless predator", and both are true: he has succeeded beyond all imagining in creating a behemoth of American industry, but, as the antitrust trial has made clear, it has not always been very pretty. It has succeeded primarily through its ability to bring products to market and to outmanoeuvre competitors.

Bill Gates started with a programme which linked together the devices on primitive computers and allowed the user to control them in a relatively easy way: a Disk Operating System. The breakthrough came in 1980 when IBM needed an operating system for its new personal computer. Gates and his colleague Paul Allen bought a rough working version from a local company for $5,000 and sold it to Big Blue, which turned the machine into an industry standard - and MS-DOS with it.

But IBM didn't own the program: Microsoft did. And within a few years it was clear that the key to the new age of computing was not the large boxes with which IBM had made its name, or even the smaller ones that it was selling by the pallet-load: it was the code which made them work, and that meant Microsoft. From MS-DOS came Windows, the world's most widely used software program and the foundation for the modern age, in which computing power is widely dispersed and easily accessible.

Now the internet is shifting that revolution into a higher gear. And it was the internet which both crystallised Microsoft's importance and inspired its current problems. For the user, the keystone of the internet is the browser, the programme linking each individual to the vast range of network possibilities. Micro- soft was faced with a stiff challenge from Netscape, the upstart young company which was pushing its Netscape Communicator. Microsoft, its opponents alleged, used its power to choke off competition and establish its internet explorer as the standard.

Microsoft claims that it is just competing like everybody else: that by innovating, developing products and then selling them as hard as it can, it is doing what capitalists do. "Users said to us, `we want to get on to the internet ... we want to do that in a simple way where we just buy a Windows PC and it's there. And we know that it works and Microsoft provides all of its support services for us'," Mr Gates told the news service CNET in 1997. "We delivered to that."

And when he stood up to defend himself on Friday, it was the same argument: that he had delivered innovation. "The court's findings do acknowledge that Microsoft's actions accelerated the development of the internet, reduced the cost to consumers and improved the quality of web-browsing software," he said. "This lawsuit is fundamentally about one question: can a successful American company continue to improve its products for the benefit of consumers? That is precisely what Microsoft did by developing new versions of the Windows operating system with built-in support for the internet."

Yet Judge Jackson has rejected this idea, conclusively. "Through its conduct toward Netscape, IBM, Compaq, Intel, and others, Microsoft has demonstrated that it will use its prodigious market power and immense profits to harm any firm that insists on pursuing initiatives that could intensify competition against one of Microsoft's core products," he wrote. "Microsoft's past success in hurting such companies and stifling innovation deters investment in technologies and businesses that exhibit the potential to threaten Microsoft. The ultimate result is that some innovations that would truly benefit consumers never occur for the sole reason that they do not coincide with Microsoft's self-interest."

If you are tempted to weep for Mr Gates - or are preparing to dance on his grave - think again. When Standard Oil was broken up, John D Rockefeller's wealth actually increased. Everything has moved on now, of course, at the lightning speed described by Mr Gates. Netscape is now owned by America On-Line, the Virginia company which is the world's best-known provider of internet services. There are other challenges to Microsoft, from languages like Java and Linux.

The game is moving from the PC and the browser, down to handheld devices like the Palm Pilot, or up and out on to the network. Vast new combinations are being spun from fibre-optic cable, software, semiconductors and hard cash, labyrinthine webs of corporate control aimed at capturing the largest share of the largest markets for the longest possible time. Microsoft is right in there. The game is not over for Mr Gates: in some ways, it may only just be beginning.

News
A model of a Neanderthal man on display at the National Museum of Prehistory in Dordogne, France
science
News
Richard Dawkins dedicated his book 'The Greatest Show on Earth' to Josh Timonen
newsThat's Richard Dawkins on babies with Down Syndrome
Arts and Entertainment
Eye of the beholder? 'Concrete lasagne' Preston bus station
architectureWhich monstrosities should be nominated for the Dead Prize?
Extras
indybest
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
Life and Style
ebooksA superb mix of recipes serving up the freshest of local produce in a delicious range of styles
Life and Style
ebooksFrom the lifespan of a slug to the distance to the Sun: answers to 500 questions from readers
Travel
Dinosaurs Unleashed at the Eden Project
travel
Arts and Entertainment
music
Sport
football
Life and Style
This month marks the 20th anniversary of the first online sale
techDespite a host of other online auction sites and fierce competition from Amazon, eBay is still the most popular e-commerce site in the UK
News
i100
Independent
Travel Shop
the manor
Up to 70% off luxury travel
on city breaks Find out more
santorini
Up to 70% off luxury travel
on chic beach resorts Find out more
sardina foodie
Up to 70% off luxury travel
on country retreats Find out more
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs General

    Quantitative Analyst (Financial Services, Graduate, SQL, VBA)

    £45000 per annum: Harrington Starr: Quantitative Analyst (Financial Services, ...

    Application Support Engineer (C++, .NET, VB, Perl, Bash, SQL)

    Negotiable: Harrington Starr: Application Support Engineer (C++, .NET, VB, Per...

    C# .NET Software Developer (Client-Side, SQL, VB6, WinForms)

    Negotiable: Harrington Starr: C# .NET Software Developer (Client-Side, SQL, VB...

    C# Developer (Genetic Algorithms, .NET 4.5, TDD, SQL, AI)

    £40000 - £60000 per annum + Benefits + Bonus: Harrington Starr: C# Developer (...

    Day In a Page

    Middle East crisis: We know all too much about the cruelty of Isis – but all too little about who they are

    We know all too much about the cruelty of Isis – but all too little about who they are

    Now Obama has seen the next US reporter to be threatened with beheading, will he blink, asks Robert Fisk
    Neanderthals lived alongside humans for centuries, latest study shows

    Final resting place of our Neanderthal neighbours revealed

    Bones dated to 40,000 years ago show species may have died out in Belgium species co-existed
    Scottish independence: The new Scots who hold fate of the UK in their hands

    The new Scots who hold fate of the UK in their hands

    Scotland’s immigrants are as passionate about the future of their adopted nation as anyone else
    Britain's ugliest buildings: Which monstrosities should be nominated for the Dead Prize?

    Blight club: Britain's ugliest buildings

    Following the architect Cameron Sinclair's introduction of the Dead Prize, an award for ugly buildings, John Rentoul reflects on some of the biggest blots on the UK landscape
    eBay's enduring appeal: Online auction site is still the UK's most popular e-commerce retailer

    eBay's enduring appeal

    The online auction site is still the UK's most popular e-commerce site
    Culture Minister Ed Vaizey: ‘lack of ethnic minority and black faces on TV is weird’

    'Lack of ethnic minority and black faces on TV is weird'

    Culture Minister Ed Vaizey calls for immediate action to address the problem
    Artist Olafur Eliasson's latest large-scale works are inspired by the paintings of JMW Turner

    Magic circles: Artist Olafur Eliasson

    Eliasson's works will go alongside a new exhibition of JMW Turner at Tate Britain. He tells Jay Merrick why the paintings of his hero are ripe for reinvention
    Josephine Dickinson: 'A cochlear implant helped me to discover a new world of sound'

    Josephine Dickinson: 'How I discovered a new world of sound'

    After going deaf as a child, musician and poet Josephine Dickinson made do with a hearing aid for five decades. Then she had a cochlear implant - and everything changed
    Greggs Google fail: Was the bakery's response to its logo mishap a stroke of marketing genius?

    Greggs gives lesson in crisis management

    After a mishap with their logo, high street staple Greggs went viral this week. But, as Simon Usborne discovers, their social media response was anything but half baked
    Matthew McConaughey has been singing the praises of bumbags (shame he doesn't know how to wear one)

    Matthew McConaughey sings the praises of bumbags

    Shame he doesn't know how to wear one. Harriet Walker explains the dos and don'ts of fanny packs
    7 best quadcopters and drones

    Flying fun: 7 best quadcopters and drones

    From state of the art devices with stabilised cameras to mini gadgets that can soar around the home, we take some flying objects for a spin
    Joey Barton: ‘I’ve been guilty of getting a bit irate’

    Joey Barton: ‘I’ve been guilty of getting a bit irate’

    The midfielder returned to the Premier League after two years last weekend. The controversial character had much to discuss after his first game back
    Andy Murray: I quit while I’m ahead too often

    Andy Murray: I quit while I’m ahead too often

    British No 1 knows his consistency as well as his fitness needs working on as he prepares for the US Open after a ‘very, very up and down’ year
    Ferguson: In the heartlands of America, a descent into madness

    A descent into madness in America's heartlands

    David Usborne arrived in Ferguson, Missouri to be greeted by a scene more redolent of Gaza and Afghanistan
    BBC’s filming of raid at Sir Cliff’s home ‘may be result of corruption’

    BBC faces corruption allegation over its Sir Cliff police raid coverage

    Reporter’s relationship with police under scrutiny as DG is summoned by MPs to explain extensive live broadcast of swoop on singer’s home