Why there's no need for the rest of us to feel at all sorry for billionaire Bill Gates

  • @dusborne
Just for a while there it was possible to feel sorry for Bill Gates. The 39-year-old chief executive and co-founder of the Microsoft Corporation had apparently become too successful even for American tastes. In Washington DC, the competition lawyers in the Justice Department had concluded he was getting a little too big for everyone else's welfare and wanted to stand in his way.

In one dramatic instance recently, Justice actually prevailed. In May, Microsoft was forced to abandon its proposed $2.4 billion takeover of Intuit, maker of a highly popular personal finance programme. This came after a five-year running battle between the federal regulators and Gates over a range of monopoly issues, parts of which are still being argued in the courts.

Then last month, Justice reared up again. This time, it was targeting Microsoft's soon-to-be-launched new version of its world-beating Windows software operating system, called Windows 95. Specifically, the government wanted to investigate plans to include in Windows, as an integral feature, a connection to Microsoft Network.

A new departure for Gates, the Network will be an on-line service comparable to those already offered by CompuServe, Prodigy and, on a smaller scale, Rupert Murdoch's Delphi. Concerned that Microsoft would thus instantly create for itself an unfair advantage in the market, Justice subpoenaed pertinent documents from the company and from its competitors.

This was too much for Gates, who shot back with a petition seeking to block the subpoena. This latest broadside, it said, was only "the latest salvo in what increasingly appears to be a campaign of harassment" aimed at Microsoft. The Justice Department, pooh-poohed the complaint, calling it a "tempest in a teapot" and is expected to announce as early as this week whether it intends, regardless, to seek to ban Microsoft Network in the new Windows package.

What's more, all of this hard comes on the heels of IBM's successful takeover last month of software jewel, Lotus, world leader in the up-and- coming species of software known as "groupware", which allows groups of PC operators to work together on the same data at different locations.

Generally applauded by analysts, Big Blue's move was widely characterised as giving it its first good shot in ages at getting back at Microsoft for effectively stealing the software sector from under its nose back in the late 1980s. These were not good days for Gates.

But last week, Forbes Magazine reminded us why feeling badly for Gates really is not appropriate. In their latest ratings of the richest business moguls on the planet, he came out on top for the first time, displacing a Japanese property magnate. His wealth, we learned, had leapt from a measly $8.1 billion last year to a handy $12.9bn today. This was fueled, of course, by Microsoft's surging stock price. And surge it still does, in spite of the various controversies. Meanwhile Microsoft's sales for the year ending 30 June, even before the release of Windows 95, are expected to touch $6bn.

Gates, it is just worth mentioning, is in the processing of building a new home for himself by a lake near Seattle, Washington, where the company is based, that will be something more than a hovel. Included in the plans: a 19-metre pool, a boulder-rimmed hot-tub, games room, cinema, video walls displaying priceless art, a 14,000-book private library and a salmon stream.

So what about Windows 95? The Microsoft Network issue is a potential hitch and leaks from company headquarters early last week suggested that preparations were being made to decouple the on-line feature from the package in case the Justice threat of an injunction becomes reality.

Expressing frustration, a company spokesman said of the on-line feature: "We look at this as an anti-trust regulator's dream. Microsoft Newtork meets all the standards for increasing competition. We're increasing the number of choices that customers have".

Much more important to the company is its need to stick to the promised 24 August launch-date for Windows 95, which had originally been destined for the shops in the middle of last year.

Any further delay would provoke massive disappointment in the industry, where the impending arrival of Windows 95 is being heralded as something little short of the second coming. So much so, that company executives are trying to downplay some of the hype. "It's just software", remarked senior vice president, Brad Silverberg, recently. "It doesn't cure cancer. It doesn't grow hair. It's not floor wax. It's Windows".

The excitement is understandable, however. Windows in its various previous incarnations is used on an astonishing 80 per cent of all personal computers worldwide. The implications for new sales of an upgraded version are enormous, not just for Microsoft itself, which expects to ship 50 million packages in the first year, but also for everyone else in the industry. That includes the manufacturers of the PCs themselves, many of which will be offered with Windows 95 as a built-in feature.

With Gates thus bestriding the software world, it is surely no surprise that the Justice Department should at least be interested. Certainly, in their latest tangle with Gates, the regulators have the support of on-line rivals. Pierce Reed, a CompuServe spokesman, said: "When you bundle your application in with your monopoly or dominant operating system, you tilt the playing field tremendously in your favour".

The next few days will see how determined the regulators are. But if Washington does torpedo the Network it is not likely to knock Microsoft, or its master, very far from its extraordinary course.