Entrepreneur

The real legacy of Bill Gates

W
David Crow says the billionaire Microsoft founder, who retires this month, is revered and loathed in equal
measure – and will be remembered more for his philanthropy than his software

hen Bill Gates gave his own take

on the ‘I have a dream’ speech
in 1975, his vision of a computer
in every office and home looked
distinctly unlikely. But having
devoted his life to that cause,
Gates has done more to make the dream a reality than
any other individual. Now, after three decades at the
helm of the world’s most successful software company
and amassing a fortune of $50 billion, the world’s rich-
est geek is giving up his day-to-day role at Microsoft.
Many will mourn his departure; others won’t be sorry
to see him go. Revered and loathed in equal measure,
it’s impossible to think of a more divisive figure in the
technology world.
The 52-year-old Gates’s contribution to the computer
revolution is hard to overstate but difficult to define.
Although he is an accomplished programmer, Gates has
never been much of an inventor – the talent normally
required for successful technology entrepreneurs. When
he made his killer move by licensing the MS DOS oper-
ating system to IBM in 1980, Microsoft had not written
a single line of the system’s code, but bought it off the
peg from a little-known software firm. Instead, Gates
will be remembered for the shrewd deal he struck with
IBM, one which guaranteed his firm a royalty every time
a PC was sold. His second triumph was talking IBM out
of exclusivity, paving the way for Gates to license the
system to many other computer manufacturers.
Using his enviable position as the provider of the
world’s operating system, Gates built a huge software
Caption here empire, but the pattern that emerged in the first deal
Caption never really disappeared. It was Apple, not Microsoft,
who designed the first viable graphic user interface, but
Gates who provided it to the mass market in the form
of Windows. Nor did he invent the word processor or
spreadsheet, although his Office suite became – and
still is – a cornerstone of nearly every firm’s productiv-
ity. The list is seemingly endless. Novell was the first
big name in networking while Netscape launched the
inaugural mass-market internet browser; in nearly every
case, Gates developed a competitor to an existing prod-
uct and won through.
His professional legacy is not one of innovation, then,
but one of trend-spotting. Every time he saw something
that would be big, he mimicked and often bettered it,

44 Spectator Business July/August 2008

044 Entrep Bill Gates.indd 44 26/6/08 17:04:51

 using his exponentially growing profits to develop and
refine his products. He was, of course, famously bullish,
with no market out of bounds. As far as Gates was con-
cerned, if he gave firms notice that he was about to enter
their sector, they had better get out of the way quick.
It was not determination alone, however, that
cemented Gates’s reputation. He had an inimitable
knack of being able to talk to both techies and chief
executives in language they understood. As Microsoft
grew, he began to empathise with the needs of global
corporations, but always included network administra-
tors and rank-and-file IT staff in his consultations, devel-
oping products that made their working lives easier. In
truth, Gates conquered the corporate software sector by
looking out for the little guy.
Unsurprisingly, technology evangelists have found
Microsoft’s sheer dominance hard to stomach. They
argue that in building a monopoly on the computer desk-
top, Gates stifled creativity and innovation; who knows,
they ask, what else could have been achieved if his
spectre had not loomed so large over the development
of the computer? Painting him as a greedy, self-serving
megalomaniac, those who Gates has defeated claim that
he has profited at the industry’s expense.
For all the chattering that goes on in Silicon Valley,
however, the fact remains that while Gates has amassed
a huge personal fortune, he has also left the world a
richer place, socially and financially. Without his ruth-
less drive to increase computer usage and his determina-
tion to standardise everything with the Microsoft stamp,
the huge growth in the global marketplace – along with
the social benefits is has brought – would be far less
remarkable.
There is, of course, some truth in the allegations
against Gates. His strategy has been shamelessly protec-
tionist, earning him the attention of anti-trust authorities
in the US and Europe. Smaller software developers have
always struggled to fight Microsoft when it has poached
their talent and ideas, despite the fact that Gates defends
his own patents vociferously. But Microsoft is not
that different from other tech firms, nor is Gates more
tenacious than other celebrated chief executives in his
industry. Steve Jobs of Apple, a one-time arch-enemy
of Gates, now pursues just as ruthless a protectionist
strategy with the iPod and online music store iTunes.
Similarly, Google is well known for stamping out fledg-
ling competitors, despite its proud claim to ‘do no evil’.
Gates provided the blueprint for building a successful
technology firm; his competitors may criticise, but they
are more than willing to steal it.
Despite these achievements, Gates will leave the firm
he built from scratch amid palpable uncertainty. When
he announced two years ago that he would be phasing
out his executive role, he had a plan for securing his
professional legacy. Gates hoped that Windows Vista,
the product of nearly six years’ labour, would achieve
critical acclaim and commercial success while the Xbox
would be the world’s best-selling games console. Simi-
larly, he expected the firm to be at least making inroads
against Google.
The reality couldn’t be more different. Sales of Vista
have been stodgy due to a poor reception from network
managers, many of whom feel it is less secure against vi-
ruses that its predecessor XP. Some firms are so worried
that they’re actually removing the new operating system
and replacing it with the old one. Similarly, although
consumer sales figures are artificially buoyed by the
044 Entrep Bill Gates.indd 45
Bill Gates’s cv fact that the operating system is bundled with every
Born 1955 PC, just as it was in the 1980s, very few consumers are
Educated Lakeside buying upgrades. The problems extend to Microsoft’s
School, Seattle and other big cash cow, Office; although the latest version
Harvard has received critical acclaim, few firms are willing to
splash out on training in the middle of the credit crunch.
Founded Microsoft 1975 Unsurprisingly, the difficulties have begun to affect the
Launched first retail firm’s bottom line. After a string of impressive financial
version of Windows performances, its quarterly profit dropped 11 per cent on
1981 last year.
Founded the digitial Software is the least of Microsoft’s worries, however.
imaging company Corbis The firm’s botched attempt to buy rival Yahoo has seri-
1989 ously damaged its reputation. In trying to purchase an
Established William H ailing competitor, Microsoft was admitting that it could
Gates Foundation 1994, not fight the Internet behemoth Google by itself. Despite
Bill & Melinda Gates having spent over $10 billion internally to try and launch
Foundation 2000 some kind of offensive, Microsoft still lags a poor third
behind Yahoo and Google in nearly every measure of
Director, Berkshire
success on the web. Gates used his last few weeks to try to
Hathaway 2004–
reassure people that his firm can make it without the help
Received honorary of Yahoo, but no one is convinced – least of all investors.
knighthood from the The huge irony is that the cloistered approach that
Queen 2005 Gates cultivated – and which served Microsoft so well
in its heyday – will be the firm’s undoing. The latest
wave of online entrepreneurism is underpinned by an
open, outward-looking approach which involves direct
contact with consumers. Facebook’s recent decision to
give away its code, allowing anyone the chance to make
money by piggybacking on its site, was a shrewd move
that has been crucial to the firm’s success, but moves
like these are part of a concept which Gates just doesn’t
understand. In truth, if Microsoft was going to conquer
the Internet, it would have required a huge change – or
an earlier departure for the man at the top.
Gates will not be bored by retirement. As from next
month he will work full time for his charity foundation,
the Bill and Melinda Gates Foundation, which received
a huge boost in 2006 when Warren Buffett (a long-time
bridge partner of Gates’s father) virtually doubled its
funds. Already giving away $1 billion a year, the foun-
dation has made some real differences; aid experts say
the $1.5 billion that was earmarked for the immunisation
of children in the developing world has saved more than
1.7 million lives. The billionaire Gates is comfortable
in the role of philanthropist; the agitated nervousness
which characterised his keynote speeches virtually
disappears when he talks about the causes he holds dear.
Watching footage of Gates walking through a Nairobi
slum, applying the same tenacity to helping the poor as
he did to business, one is struck by the thought that we
need more people like Gates in the charity arena. l
Bill and Melinda
Millions of lives saved
through their foundation
David Crow is
technnology and
telecoms reporter at
City AM
July/August 2008 Spectator Business 45
26/6/08 17:05:02
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