Friday, June 16, 2006

Closing the Gates

98 Closing the Gates

So Bill Gates, the Ultimate Nerd, is retiring at the age of 50 from a company he made, at our peril, the center of everyone’s lives. The Microsoft he co-founded can thank him for making it one of the most necessary companies on the planet. He, in turn, can thank it for making him the richest guy on the planet.

Microsoft is a success for three reasons: (1) Gates’ drive and willingness to “cut off (the competitions’) air supply, (2) Gates willingness to allow incomplete or malfunctioning stuff into the retail stream and making us accept this, if not like it. And (3) one of the most colossal corporate blunders of all time.

The first and second are common knowledge. Come to think of it, the third is, too – but no one seems to remember it. Even worse, no one seems to have learned anything from it.

Here:

IBM figured the future of computers was in mainfraims. So it outsourced creation of an operating system to what amounts to a garage band of two kids with a small company. Thing is, Gates’ daddy, a sharp Washington State lawyer helped ‘em put together a contract that gave them a piece of every PC sold. Not too shabby. Not nearly as shabby as the original DOS operating system.

IBM just couldn’t believe those little desktop things would overtake their Mighty Mainframes. So accepting that contract didn’t bother ‘em a whit. It might now.

(Aside: MS didn’t invent DOS, it bought the thing and renamed it MSDOS. The price, $50,000, was later adjusted upward in a court proceeding brought by the original owners.)

Some people give Gates credit for the business model that put Microsoft on top. He didn’t invent THAT either. Gates said he wanted a PC on every desk in America. And he pretty much achieved that.

David Sarnoff at RCA wanted to put a “music box” in every home in America. That was in the 1930s. He did it first with radio and then with record players and then with television. Sarnoff also was an expert at removing the air supply from competitors. That’s how we got the 45 RPM record, the current system of color television transmission and the transmission of FM radio signals.

Synthesizing ideas from other ideas can be a good thing. Or not.

Microsoft is “The Beatles” of software. Everyone knows about them. Everyone hears about them. They haven’t had a hit in 200 years but the royalty checks keep coming in. The music’s often lousy but no one dares say so.

Gates came late to the charity business that supposedly now will have his full energies and attention. To his credit, he’s now involved up to his ears. Took him long enough to move from the company to the foundation. Henry Ford did it faster. Ah, but Henry wasn’t using “Windows” to get there.

I'm Wes Richards, my opinions are my own, but you're welcome to them.

(c) 2006 WJR

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