Bill Gates moves on I had the good fortune to interview Bill Gates four or five times during my years in the computer press. I was even fortunate enough to spend two days and nights at his summer home, along with a small group of journalists. I got to know him well enough that he greeted me by name in subsequent years. While I have never been close to Bill Gates, I developed enough of an acquaintance and followed his career closely enough to develop a perspective on how he works.

It was no surprise this past week to learn that Gates is relinquishing his role in the active management of Microsoft and turning his attention to philanthropy. He remains chairman, but turns over the Chief Software Architect role to Ray Ozzie - one of the few people who has the intellect and technical vision to match Gates’ - and Steve Ballmer, who has been running the company day-to-day for the last six years. Gates has been withdrawing from an active role in Microsoft since 2000, when he gave up the CEO role. But he has also stated publicly in the past that he intended at some point to turn his attention to giving away the huge fortune he amassed.

I suspect there was some logic to his decision to leave now. He has run Microsoft for 30 years. At age 50, he may see himself as having about 30 productive years left and so, halfway through his adult life, he’s turned from creating wealth to distributing it. He leaves the day-to-day role with class and dignity, which also comes as no surprise. For all the terrible things that have been said about Bill Gates over the years, he is a class act.

I have always resisted the temptation to oversimplify my opinion of Microsoft. I have written many editorials and opinions about the company over the years, probably about half positive and half negative. It is a complex company run by a complex man. It has done many great things and some not-so-great things. To characterize Microsoft as simply good or bad is unfair to the company and to Gates. This is a company that exemplifies what's good and bad about the industry in which it operates.

Gates undoubtedly has one of the finest business minds of the twentieth century. He pulled off what I regard as the greatest business coup of my lifetime, upsetting and nearly ruining IBM in the process of stealing its market away. Some people would say that Gates was deceptive in end-running IBM in 1991, but I think it’s more a matter of the people at IBM at the time being too out-of-touch to see what was happening. Gates saw his opportunity and he went for it. He understood the dynamics of the computer industry as few people did. He knew that a company with a 40% market share in operating systems could very quickly go to 90% share. His success at turning the tables on IBM – whose dominance of the industry prior to 1990 was almost total - is a story that people will be talking about 100 years from now.

Microsoft has always been a study in contrasts. It is a company that is capable of great arrogance but also surprising humility. Unlike many arrogant companies, it keeps plugging away at tasks and markets until it figures out how to do something right. It is not afraid of falling back and starting over. It takes a long-term view of many of its initiatives, which is remarkable given the constant pressure from investors for a quick return. Yet it has managed to reward investors with a run of almost 20 years of steadily increasing profits, a great achievement. Gates’ Microsoft was so profitable, in fact, that it eventually had to give back billions of dollars to shareholders because it simply had run out of ways to invest the money. Can you think of any other company that has done that?

Critics will argue that much of that money was made on the back of a monopoly and they’re right. However, that monopoly was built, by and large, because Gates' Microsoft convinced a whole lot of people to pay money for Windows. Microsoft didn’t buy its way to the top; it produced a product that a lot of people wanted. Windows may not have been the most technically elegant product in its class, but it was the one people chose.

It’s true that Microsoft did engage in some unethical and illegal practices in pressuring its business partners to adopt Windows. However, I think Windows would have been a big winner either way. The company simply didn’t know where to stop, and that is one of its character flaws. Microsoft has never been satisfied with just winning; it needs to stomp its rivals into jelly. Under Steve Ballmer, that attitude seems to have mellowed somewhat, but the reality is that Microsoft has to live with a legacy of having shown its opponents no mercy. It will take years to change that image, if Microsoft even wants to change it.

Microsoft has drawn much criticism for not being a nicer company. But again, I think Bill Gates understood the past and was determined not to repeat it. The history of the computer industry is littered with nice guys who couldn’t compete. Ken Olsen, An Wang and Edson DeCastro were all nice people. And look what happened to DEC, Wang and Data General.

I suspect it's difficult for Gates to leave Microsoft right now. The company is facing its most significant challenges in a decade. The natural inclination of a leader is to stay and fight, but Gates has made the decision to walk away and leave the fight to others. He's sticking to his plan. That takes guts, and I think Gates deserves credit for that.

Bill Gates has never been a media darling. He doesn’t speak in sound bites and his thoughts and sentence structure can be maddeningly random at times. He also does something that interviewers hate: he challenges the question. I have come away several times from a Gates interview thinking I was an idiot to have ever posed certain questions in the first place. He is brilliant at applying logic to a thought process to make it sound like the choice is intuitively obvious. And he's usually right.

I have rarely asked Bill Gates questions about things outside of his role at Microsoft, but about 10 years ago I did ask him about the money. I think he was worth about $10 billion at the time.

Why, I asked, was he so focused on making more money? He already had far more than he could ever spend. Shouldn't he start giving it away? He responded that his time was best spent increasing the value of Microsoft stock because the higher the price of that stock climbed, the more money he would have to give away. That answer made eminent sense to me at the time and it has become more meaningful as the years have passed. Today, he’s worth five times as much much as when I asked that question.

Bill Gates intends to spend the next 30 years giving away $50 billion. I have no doubt that he will bring his remarkable critical thinking and intelligence to the process and that the world will be a better place for his philanthropy.

Below is a photo of Gates and group of journalists (I'm third from the left, in back; Gates and Ballmer are fifth and third from the right, respectively) from a meeting at his vacation home in 1996.

  ¶ 11:19 PM