🚀 go-pugleaf

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SUBJECT:  MICROSOFT'S GATES PREPARES FOR THE NT PLUNGE
SOURCE:   ZiffWire via First! by INDIVIDUAL, Inc.
DATE:     January 15, 1993
INDEX:    [9]
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  PC Week via First! : William Henry Gates III has gone from Harvard dropout
to his current perch as the richest man in America, with a net worth
estimated at $6.3 billion. Only 37, Gates has turned Microsoft Corp., the
company he founded in 1975 with Paul Allen, into the world's largest
software developer and the dominant force in the computer industry.

  Microsoft, however, faces several challenges in the coming year, including
the timely release of its next-generation NT operating system and the
continuing spectre of the Federal Trade Commission's anti-trust
investigation. In a wide-ranging interview recently at the company's
Redmond, Wash., headquarters, Gates addressed these and other issues with PC
Week Assignment Editor Jai Singh and Senior Editor Amy Cortese.

  PC WEEK: What is your approach going to be for the large customer -- the
high-end enterprise business?

  GATES: There's a lot of stuff we do that relates to that. The development
tools for corporate customers relate to that; Access is a corporate
development tool. Anything you do that's on the server or that's a
development tool is going to be primarily aimed at the corporate market.

  The corporate market has elements of what we call bottoms up, with
products like Word and Excel. Although you've got corporate standards coming
down, the primary dynamic is end-user enthusiasm moving those things up.

  We [also] have software that can only be adopted in a top-down way, like
mail, server software, file sharing, communications and databases.

  PC WEEK: The whole server area is somewhat new for you. Are there changes
that Microsoft needs to make?

  GATES: I wouldn't say it's new.

  PC WEEK: When we're talking about products like [NT], that's an area that
you haven't really dealt with before.

  GATES: We've certainly dealt with it. We're not the No. 1 company, but I
made a decision three-and-a-half years ago to hire hundreds of people into
the U.S. field sales force to focus on LAN Manager, bringing us up the
learning curve on server products.

  We understand all of those things. Now that we have an advanced platform
instead of a dead-end platform to sell our server software on, we expect to
sell our server software. We are scaling things up for the NT generation of
file sharing, communications, database, even development tools or
activities.

  PC WEEK: If your customers are going to be running transaction processing
systems on NT and so on ... there's something of a credibility -- it's not a
gap, but it's something that Microsoft has to demonstrate in that area.

  GATES: Our credibility with corporate accounts is constantly increasing.
You go back three or four years and people wouldn't have thought about us
that much at all.

  Now NT really is telling some people who hadn't thought about it: Boy,
this is at least one of the candidates for doing all their future
applications on, certainly all their client work, if not all their server
work.

  It just means you put more resources out there in the field to deal with
customers. You use those resources not only for support, but also to get
feedback on what those products should be.

  PC WEEK: What's the initial market potential for NT? More as a desktop
client system or more as a server?

  GATES: NT will sell far more on the desktop than anywhere else, just
because of the size of that business. It helps us a lot in the server market
as well, but the numbers will be largely on the desktop.

  When you look at what we're doing from our [ISV] program, yes, we're
getting every server application you could imagine. But all that stuff we're
getting from engineering, financial analysis, that's all desktop software.

  PC WEEK: One interesting thing about NT is that ISVs are already putting
out applications on it, even though it's not available yet. What do you
attribute that to?

  GATES: Increasing credibility. I mean, people have seen that companies who
didn't bet on Windows have been affected by not getting out ahead.

  None of the existing software companies except Microsoft bet on Windows
... [but] it changed things. That's why the PC [ISVs] are saying, "Whoa.
This time we aren't going to look backwards. We're going to look like we
really care about the future and show our customers we're going to be there
as soon as they want to move up."

  PC WEEK: IBM says it has shipped 2 million copies of OS/2. There's a lot
of internal corporate development for OS/2, more than you see applications
show up in [Software Publishers Association] numbers, and basically for lack
of something else to develop on.

  If NT isn't going to be out until maybe sometime midyear, in the meantime,
does that leave a window for OS/2?

  GATES: Most people don't have development cycles where they'd have any
problems starting their development now and being there when [NT] is
released. ...

  You should be really careful when you use that 2 million number [for OS/2
sales]. For example, [IBM] counts all the bundled systems.

  We have retailers who take the OS/2, delete it, and put DOS and Windows
onto those systems. We capture a very high percentage of the systems that
way. ...

  Believe me, they haven't shipped 2 million. Either that or they're just
not paying us [royalties].

  PC WEEK: Your feeling is that OS/2 is a dead-end platform?

  GATES: It's certainly a dead end. That's indisputable. Nobody would
dispute that it's a dead end.

  PC WEEK: Despite the Workplace Shell strategy they outlined?

  GATES: Just because you put a common shell on top of a bunch of things --
Workplace is the name of a shell. It's not the name of an operating system.
... That's called a dead end.

  PC WEEK: IBM's Lee Reiswig made a comment recently about having the rights
to clone Windows. We all know that agreement expires in September.

  Does he have the right to reconstruct Windows without licensing it?

  GATES: Well, after Sept. 17th at midnight he has no rights for any new
work that this company does, whether it's user interface work or code that
we develop or anything of the kind. They will never have the future Windows
look and feel or development work. ... So people who write Windows
applications that follow the Windows style guideline will not have any
transference into the OS/2 environment.

  PC WEEK: Can you give us an update on Cairo?

  GATES: It's a very ambitious system, so you can think of it sort of as NT
version 2. In terms of how it [uses] file structures and how it does things,
it's very ambitious.

  We've done this thing where we treat the file system and the directory and
the mail system all as one unified system. So it's much richer than today's
file system.

  Virtually all the distributed pieces are working now, but there's still a
lot of work to be done. It's likely that we'll want to get some broad
feedback [on Cairo] in the second half of '93.

[01-15-93 at 22:18 EST, Copyright 1993, ZiffWire, File: c0115081.5zf]