Wednesday, January 04, 2006

 

Can we ever go back to just holding hands with Bill Gates now that we've all bent over and...

... submitted to the Microsoft Monopoly?

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Bill and Melinda Gates are pictured on the cover of Time Magazine sandwiching Bono in a three-way of "Good Samaritanism." Apparently Gates has been engaging in philanthropic activities in the third world.

gates

I have a problem with the idea of naming Gates as a Person of the Year for any sort of goodness -- as opposed to say naming him person of the year for beating the U.S. Justice Department Antitrust Division into submission. You don't have to be a "good" person to win that Time Magazine honor, just -- like Hitler, who was "Man of the Year" for 1938 -- influential. But there's that phrase "good samaritan" right there on the cover. I just don't see Bill Gates as any sort of a good person.

For starters, Bill Gates is literally the richest man in the world, according to Forbes Magazine, with a net worth of 40.7 billion dollars. A man with that much money would have to give away an awful lot just to avoid being named "World's Biggest Selfish Asshole." I'm not sure what I'd do with that much money, but I'm pretty sure that I'd feel like I had a comfortable nest egg at around $1 billion. That would give me, if I were Gates, around $39.7 billion to play with philanthropically. Or else maybe buy one of the Virgin Islands.

Don't be fooled by the geeky sweaters and wire-rimmed glasses. Gates is a robber baron in the worst American, John D. Rockefeller, anti-competitive tradition. Microsoft has risen to dominance, not with superior products, but superior skills at playing the game of capitalism. It has consistently gobbled up, or destroyed, superior products in its rise to its mind-boggling market share.

Microsoft controls the operating systems of, what, 85% of the world's personal computers? That strikes me as kind of like a political leader who controls 85% of the media outlets. (Imagine Rupert Murdock 10 times more powerful in his media field while serving as President of the United States.) Any small software maker who doesn't do what Microsoft wants might find its product suddenly incompatible with Windows.

Ten years ago, the word processor Word Perfect had the lion's share of the legal professional market. I happen to find Word Perfect to be a much better and more user friendly program than Microsoft Word. Now I'm pretty sure that Word has the majority business and in another 10 years, we'll all be using it.

How? Simple. Not by head to head competition for the better product, or even the better marketing in a fair economic fight. Instead Microsoft has for years gotten away with bundling its software, including Word, with new personal computer sales. When college students or law students buy their first computer, what do you think they're gonna do -- shell out $300 for a new edition of Word Perfect, or just take the copy of Word that comes with the computer apparently free or heavily discounted (its sales price buried into the sticker price for the computer)? In this diabolically clever way, Microsoft has taken over the student market, and is biding its time until those students take over the purchasing decisions for their professions.

And it gets even worse. One of my neices is taking a class in her public high school, which provides training in office software -- spreadsheet, word processing, etc. The course is called "Microsoft" for short, because the software used in the course is the Microsoft Office package.

Did Microsoft discount or even donate the software to my neice's public school? What good samaritans!

This stuff should all be illegal under the antitrust laws, of course, but even if it were not under the control of the Bush administration, I doubt whether the Antitrust Division has the stomach for a new opportunity to be spanked in litigation with Microsoft.

So to me, celebrating Bill Gates's charitable work is just another instance of our democratic society's dark secret love of the benevolent tyrant.

Comments:
Um, he could just keep his money you know.

He's giving more than you or me to these causes.

But I'm sure you are a nicer guy with better intentions and more friends.

Niece (i before e, except after c)
 
I agree with you that Gates could be doing more, but he could also be doing less. It's not like he has $40.7 billion in cash lying around. Most of it is paper money, in Microsoft stock. He'd either have to give away stock to charity or sell the stock and pay whatever taxes aren't offset by donation to charities. In either case, he'd be in effect ceding control of Microsoft to someone else. If someone were able to buy up all his stock and get 50% of total stock, they could do whatever they wanted with Microsoft. I don't think Gates would allow that to occur. Unless Microsoft were to force Gates out similar to what happened with Time Warner and Ted Turner, it doesn't seem likely that he would liquidate any signficant fraction of his stock.
 
Great post, Oscar.

Wish I could say that about the 2 comments above... I look forward to hearing what Tom Bozzo has to say.
 
When I read that article, and saw how much money he and his wife have donated in one year, I was pretty impressed. But your article, in turn, has me thinking...
 
Oh I feel your pain Oscar. Over my career have seen the slow slipping away of other quality PC software too. I remember 10 years ago when Lotus spreadsheet software was replaced by Excel at my company. To this day, I still want to use the @sum function instead of the clumsy + alt shift sigma motions of Excel. Plus Lotus had the best fonts and financial statement templates deliverd with the basic product years before Micosoft rolled out the annoying dancing paper clip "Wizzard". And the Wizzards today are not as intuative as the 10 year old Lotus was then.

Good to see that Bill and Melinda are stroking their Karma. If you are pissing off your captive clients, the least you can do is pass along the proceeds to those that have no idea of what you did to get it.
 
Janelle: I'm flattered you're interested in having me weigh in.

Bryan: The Gateses give Microsoft stock to their charitable trust, which then liquidates the stock and doles out grants. Microsoft's market cap is around $290 billion, so they're minority shareholders as it is.

The economic concept to learn is deadweight loss, which is to say that if MSFT behaved competitively, Gates individually would be less rich but society o/a would be richer. (Some monopolies can be dynamically efficient -- that's the economic rationale for patents -- but MSFT's practices with respect to its IP holdings [a lot of which is junk, along with the whole software patent universe, IMHO] are hardly beyond reproach.)

I generally agree with Oscar that most Microsoft products have been good enough, at best. I'm a dedicated Mac-head, so take that as you will. Word 5.0a for the Mac actually was a superior product in its day; the main problem is that Word v.X (and its PC counterpart) is not a noticeable net improvement 15 years later (it's much better than most of the interim versions of Word for both platforms). Windows monocultures are showing itself to be a net problem, as the various security clusterf***s make me wonder why companies love [sic] Windows so much. (Though while I think OSX is superior, I don't have any illusions that I could live without virus scanners if it had 80% of the OS market.) I have a draft post with some thoughts on that which I may have to dust off and complete.

I think it's less that Microsoft beat the AD into submission (though I do wonder what the source of David Boies's reputation as a fearsome litigator is) than the change of administration led the JD to roll over. MSFT's clearly fared less well with the EU.
 
Agree or not agree, this is an informative post. I'm glad to read it and do some thinking along lines I might otherwise have ignored.
So, in this new year, thanks. Look forward to continued, stimulating look into your thoughts and observations.
 
Um, note to Anonymous 5:35: Seize the weird.
 
Thank you, Oscar, for saying something that needs to be said, probably over and over again.
 
Everytime I click onto your blog and see that photo of Bono holding hands with Gates, it makes me cringe. That's an image that I'd rather not have imprinted on my psyche.
 
Bill Gates good, Bill Gates bad, who cares? What about the fact that Bono can't sing??
 
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