Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!usa-post Newsgroups: usa-today.bonus From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: bonus Tue, Mar 31 1992 Date: Tue, 31 Mar 92 05:49:46 EST Message-ID: 03-31 0000 BONUS: Gates has Microsoft on top USA TODAY Update March 31, 1992 Source: USA TODAY:Gannett National Information Network You could tell Bill Gates wasn't relaxed. On the edge of a plush sofa in the lobby of the Westin La Paloma resort in Tucson, Ariz., the USA's richest self-made man was doing a great imitation of pacing while sitting. Knees crunched, pausing only to shove thick glasses back onto his nose, Gates rocked forward and back like a pendulum, thinking over a reporter's every question. The mannerism is pure Gates, the billionaire who reigns as the 36-year-old chairman of Microsoft, the world's biggest personal-computer software company. HAS ALL THAT PONDERING PAID OFF FOR GATES? Microsoft's basic software runs 60 million PCs throughout the world. Its stock is trading at all-time highs, and earnings have been doubling every quarter in recent years. You'd think Gates, with nearly $7 billion in Microsoft stock, wouldn't have a worry. He has plenty. If you're at a pinnacle, as Microsoft is, plenty of people are eager to shoot you down. In fact, Microsoft now faces the toughest challenges in its 17-year history. WHAT ARE THE CHALLENGES? Tuesday, IBM, Microsoft's ally-turned-enemy, starts limited shipments of OS:2 version 2.0, the much-delayed software IBM hopes will supplant Microsoft's MS:DOS as the guts of most PCs. OS:2 is similar to Microsoft's Windows software in that it lets users do several things at once, such as perform accounting calculations while writing a memo. IBM is planning a multimillion-dollar ad blitz to promote OS:2, and it's pricing like a predator: OS:2 2.0 lists for $139, Windows 3.1 for $149. But if you throw out Windows and buy OS:2, IBM will charge just $49. WHAT IS MICROSOFT DOING TO FIGHT OFF IBM? To counter IBM, Microsoft just launched its first television ad campaign - an $8 million, six-week extravaganza designed to persuade thousands of PC users to buy Windows 3.1, which will hit store shelves April 6. WHAT ELSE DOES MICROSOFT FACE? Next month, a federal judge in San Francisco will begin hearing motions in a landmark lawsuit over whether Microsoft illegally copied portions of software used in Apple's Macintosh PCs. Apple is seeking more than $5 billion in damages. In a year-long probe into its business practices, the Federal Trade Commission is looking for evidence that Gates misled the software industry in the 1980s by promising to develop OS:2 with IBM when he was planning to abandon the OS:2 project for Windows. By abandoning OS:2, critics say, Gates threw the development plans of hundreds of software companies into chaos. DOES GATES HAVE THE MARKETING PROWESS TO KEEP MICROSOFT SOARING? He does have quirks and nerdy habits - like saving old grocery coupons for late-night trips to 7-Eleven - but some say he's the consummate manager - that rare blend of technical whiz, opportunist, salesman and visionary. "Gates understands both the business world and the technical world," says James Wallace, co-author of an upcoming unauthorized biography, "Hard Drive: Bill Gates and the Making of the Microsoft Empire." "He knows more about marketing than most marketing people and more about selling than most salesmen." DOES GATES EMBRACE THIS DESCRIPTION? "Nothing done in sales and marketing is easily ascribable to any single individual," Gates says. "But we're entering a very intense period of marketing. We've got a new version of Windows. We're trying out TV advertising. I like to get involved in all these meetings and processes, but I wouldn't put my individual name to any one of these things." That's like saying Popeye hates eating spinach. Last month, Gates showed how deeply he's involved in running Microsoft by firing its president - Mike Hallman, a former IBM executive. Gates replaced Hallman with three of his closest associates. HOW IMPORTANT WAS THE SHAKEUP? Gates downplays its importance. "Hallman was the guy who had been there the least time," Gates says. "We had a very unusual management structure in that on paper, I only had one person working for me. There aren't many companies that were structured the way we were." WHAT DOES HALLMAN'S DEPARTURE MEAN FOR MICROSOFT? The Hallman departure leaves Gates with the task of courting Fortune 100 companies, who are more accustomed to dealing with companies like IBM but whose allegiance Microsoft needs to keep growing. That will require Gates to change his style. He'll have to be more diplomatic and less confrontational than he is with subordinates and industry luminaries. And that won't be easy. "The guy you sell to at corporations isn't going to do business with a guy like Bill Gates," says Robert Cringely, author of "Accidental Empires," a book that chonicles several PC pioneers. "Gates isn't replacing Hallman with anyone else who's able to make that kind of sale. The company has a gap there that will have to be dealt with." WHAT'S IT LIKE DEALING WITH GATES? Dealing directly with Gates can be an ordeal. He's notorious for challenging almost everyone who doesn't agree with him. As CEO, he frequently sends blistering computer messages known as "flame mail" to even his most junior employees. Two of Gates' favorite quips: "That's the stupidest thing I ever heard." And "I don't know how technical you are." The second line can "mean a lot of things, depending on who he's talking to," Cringely says. "It can mean you are such a lowly life form that he's not sure what language you understand. Or it can be a technique for changing terms, when he's technically on the defensive." WHAT DO GATES' WORKERS SAY ABOUT HIM? Even Gates' second-in-commands concede that dealing with "Chairman Bill" can be quite unnerving. "Bill is incredibly smart," says Mike Maples, one of three members of the Microsoft presidency. "He'll remember what you said better than you'll remember it. He'll remember what you wrote better than you'll remember." IS HIS MEMORY REALLY THAT GOOD? The famous Gates memory dates to 1966, when an 11-year-old Gates was eager to win a trip to the famous Space Needle restaurant atop the tower that served as the centerpiece of the 1962 Seattle World's Fair. To win the trip offered by his pastor, Gates had to memorize Chapters 5, 6 and 7 of the Gospel of Matthew, better known as the Sermon on the Mount. According to "Hard Drive," Gates recited the sermon flawlessly. As Gates told his pastor afterward, "I can do anything I put my mind to." And he's pretty much been doing so ever since. Bonus Editor: Michele Coleman. (1-919-855-3491) Making copies of USA TODAY Update (Copyright, 1992) for further distribution violates federal law. This article is copyright 1992 Gannett News Service. Redistribution to other sites is not permitted except by arrangement with American Cybercasting Corporation. For more information, send-email to usa@AmeriCast.COM