Ian & Stuart's Australian Mac: Not for Sale/Another.not.for.sale (Australia).iso/I got a plan/Gates Interview (unabri

Text File | 1994-11-11 | 35KB | 629 lines

Bill Gates interview

January 24, 1994

Tension between Microsoft Corp. and Apple often makes headlines. But no software
house is as important to the Mac as Bill Gates' company. MacWEEK sent Editor in
Chief Mark Hall and Senior Editor Andrew Gore to Redmond, Wash., to get the
Microsoft CEO's thoughts on the Mac and Apple.

MacWEEK: What is Microsoft's commitment to the Macintosh, both the 68000 base and
PowerPC?

Bill Gates: Microsoft is the company that made the first commitment to the Mac.
It has invested the most [in] the Mac. [The Mac] has benefited immensely from
that early and ongoing commitment. Our Mac products do super-well. And so what
you'll see from Microsoft is a continuation of enhancing the products we have
[and] also changing those products to take advantage of new things that Apple
does.

As far as PowerPC goes, there's a technical issue of moving the products across;
we use our own development environment. [But] our commitment to the Mac as a
68000 platform and as a PowerPC platform is absolutely identical.

[As to] how quickly we'll get [applications] out, we're going to try to get them
there from the very beginning, and it will vary by title how quickly things come
along.

MacWEEK: Are there shortcomings to Mac development environments other than yours?

Gates: Well, people seem to get by with other tools. I mean, people are welcome
to use whatever development environment they want. They haven't had the choice of
using ours. It will be about mid this year that we actually productize [our]
tools.

MacWEEK: So are you saying that, for instance, you'll have warrant of a Word,
Excel or whatever add-on for the PowerPC at or near launch?

Gates: I don't think I want to give a date because we like to have some
excitement for when we really do the thing. Suffice it to say we're working hard
... if we really have to be concrete about dates, all we've said publicly is that
we'll have those things this year. And obviously we hope to do far, far better
than that.

See, in our case, we're not doing partial things. We're not using funny tools ...
we are taking a very high-quality, optimizing PowerPC compiler and we're
recompiling the entire application, including moving over the parts to be native
code for the 68000. So, a lot of things you're seeing are using tools that, you
know ... it's a pragmatic decision by people. But they're not giving people the
full benefit of the PowerPC. They're not doing a full recompilation.

[With] our approach, of course, people can take the old binaries and do the
emulation, but our approach for the PowerPC product is the full recompilation.

MacWEEK: When you do bring Word and Excel over, what do you expect the user
experience to be? Will it be significantly faster?

The PowerPC chips are faster than 68000 chips; we'll pass that through by using
full recompilation. Now the system software, part of that's emulated; that's a
case where someone's not showing off what they could show off. When it's in Word,
it'll be in full PowerPC code for that part of the thing.

MacWEEK: What percentage of Microsoft's revenue currently comes from the Mac
market?

Gates: I can put it this way. We get a higher percentage. If you look at the
ratio of how big the Windows market is [compared with] the Mac market, we have a
higher share in the Mac market than we do in the Windows market. In fact, we do
so much better on the Mac in terms of all the things we sell on the Mac, that it
offsets, more than offsets, the revenue we get by selling system software on the
PC. So if you look at what we call our revenue per Mac and our revenue per PC
here in the United States, the revenue per Mac is higher than the revenue per PC.

MacWEEK: Are you saying that dollar for dollar the Mac is a more profitable
marketplace for you?

Gates: Oh, the word profitable is a very complex thing, because there's a huge
shared component of work in building, say, Excel or Word or any of these things
we're putting together. And you might have noticed Microsoft is profitable. Let
me put it this way. Our Windows application software business is more profitable
than others' application businesses, and our Mac application software business is
more profitable than others' application businesses. We do super-well in
application software at this stage.

MacWEEK: You mentioned earlier you were going to be changing products to take
advantage of new capabilities in the PowerPC. You specifically used the term
multimedia. Can you be a little bit more specific in the types of products, other
than games, that users might expect to find coming from Microsoft that take
specific advantage of the PowerPC?

Gates: Okay, Apple has two choices with the PowerPC. They can either do
everything they do on normal Macs and just change the CPU, or they can use it as
an opportunity to add more things into the system. And the degree to which they
have chosen or will choose to do new things on the PowerPC-based systems - that's
up to them to announce.

I once said I thought PowerPC Macs would come out on the 10th anniversary of the
Macintosh. This was like a year ago. I just said that, not based on any special
knowledge I had, but Apple's all upset. You know, here's Bill Gates speaking the
word Macintosh, suggesting that hey, there's actually some marketing oomph from
doing it that way. That date passed and they didn't, so just another mistake that
I made.

So I'm not going to say what I know about their hardware ... because that
actually is information we get from them. So a little bit I have to refer to
historical things like System 7. You know, many people claimed they'd ship
applications on certain dates relative to System 7 and do all these things ...

And anyway, whatever it was, publish and subscribe, or balloon help or 32-bit
clean, [it is] Excel which has always been, of all our applications, kind of our
leadership application to do new things on the Mac. I mean, it was the first to
do those things. And we'd have such a huge business, say, selling Word or Excel
or more and more, selling the integrated version which we call the Microsoft
Office. ... The people who do the Mac version are always focused on what can they
do for the Mac version. Apple's had such a focus on PowerPC ... it's really more
burdensome on the tools people and our testing people than on our, say, Mac Excel
or Mac Word developers. Apple hasn't had that many things out on the table.

Say you're a Mac developer today. What are the new things you're supposed to be
doing that are new and big? It's not a very long list today. Now maybe that's
their judgment that they just need to get everybody focused on recompilation. But
it's kind of too bad in a way there aren't more things that our Mac-focused
people can go out and do.

MacWEEK: Do you think Microsoft's Mac commitment will ever change?

Gates: We're totally committed to the platform. There's no one even close to our
commitment. Maybe this quarter we made more selling Mac software than Apple made
selling Mac hardware. I think so - it's not that hard. We'll be there after
[Apple] abandons it. We'll be there selling updates to the installed base.

MacWEEK: What percentage of your total business is Macintosh software?

Gates: Well, of course it always depends on how you class things. You leave out
system software revenue, because it's mostly bundled revenue for them. Because of
our very good share in the classic productivity tools - word processing,
spreadsheet, presentation packages - we have a darn, darn good percentage, and
over 70 percent of that is the PowerPoint-type business. We have a pretty good
share of databases now, which will grow substantially with this Fox release we
just did, [and we have] an OK share on the multimedia titles - that's a case
where there's just so many titles that no one will ever have a dramatic shot at
it.

But if you take all those things and then took our Mac sales as a percentage of
SPA revenue, I think you'd get like 35 percent, maybe 33 percent. Let's say it'd
be about a third of that overall.

MacWEEK: That's very impressive ...

Yeah, it's partly because we do well on the big categories. I mean, if you took
how many software packages we offer as a percentage of Mac software packages,
it's probably 5 percent. You know, it's a tiny number because of the number of
font packs and the 94 edit-the-graphics-bits-this-way type packages, all of which
are very nice, but the market size is not quite the same.

So we are a larger part of the Mac software market than any publisher is of any
software market that I'm aware of. I mean, in percentage of sales and level of
success. You know, it's phenomenal.

MacWEEK: Would you say Microsoft needs the Apple platform?

Gates: To continue our success we do. I mean, we have a large group of people in
this company who are Mac lovers. And whenever we're adding some new feature, it's
their job to say OK, this is how we could do better with that on the Macintosh,
or here's how we can do these things.

You guys know the kind of fervor and loyalty the Mac generates. There are people
here who I think have longevity in terms of working on Mac software right up
there with anyone because Apple's actually had a fair bit of turnover. I mean,
they still have great people there but a lot of the original people either moved
on to other projects inside Apple or and ended up going to other places.

There's some tricky problems with the Mac, because people don't upgrade their
system software as rapidly on the Mac as they do in some other platform areas.
It's actually surprising that System 7 didn't pull people in. The extra memory,
I'm afraid, was the key. If it had taken the same amount of memory, the switch up
would have been dramatically higher.

Anyway, there are people [here] who know such subtle things about making the Mac
work, and because we had to squeeze our early software in and our software is so
important to the Mac, whenever Apple changed the system software, [we had to ask]
does it work well with the new memory manager or this new definition of 32-bit
clean. We have to be right there at the bit level of those guys helping them
understand what's going on.

So we have quite a Mac following here inside the company. And that's very
healthy, because those are our people who relate to Apple and generate the unique
ideas.

MacWEEK: With such a large revenue, you said 35 percent of the total software
market, how big an impact do you think it would be if there aren't the native
Word and Excel mainstays of the Mac productivity market when the market shifts to
PowerPC?

Gates: Obviously I have a bias. I think our software is fairly important, but
fortunately it's a fairly hypothetical question. We will be there pretty early in
the life of the PowerPC and today is not the day to be really specific about
that. You know, when we are able to be very concrete about that and talk about
how it works for people who do upgrades and things like that, we'll do a very
exciting announcement. And so rather than dribble that out or let Apple announce
that for us, it's a big enough thing for us that we're going to do a special
announcement of where we are on this PowerPC stuff.

What I really want to say today is we are working hard on this stuff. Apple often
discriminates against us because we are not only the biggest Macintosh software
house, but we're also the creator of Windows. And so their schizophrenia about us
sometimes works to our disadvantage in terms of getting information or help for
things. Recently on PowerPC stuff, they've been super good. But if you go back
and look at a number of things like AOCE or QuickTime or even early PowerPC
stuff, we don't get the same treatment that other developers get, even though we
do all these things they could possibly ask for. So, it's a challenge, but it's
one that we're good at meeting.

MacWEEK: One last question on applications. As a Macintosh applications
developer, what would Bill Gates' wish list be for Apple concerning PowerPC and
the Macintosh? What would you like to see them do in the next year?

Well, at every stage of the Macintosh, I've been very open about going down to
Apple and sharing with them my thoughts, [even in the] early days when we said
Apple should license their system software. There's a classic letter I wrote to
Gosset that just said, you should license your system software, and the irony of
it is so unbelievable because here we are, we're the only people who would lose
market share by them doing this. So I write this letter to Gosset saying here's
who you should do it with and here's what you should do. And, the worst thing is,
then they decide that these Microsoft guys are so clever, there must be someone
here.

MacWEEK: The Trojan Horse?

Gates: I mean, we'll screw ourselves if we do this. And we caught them - we
decided not to do it. And so there was this very negative reaction to our even
suggesting they should license the software. Now, in retrospect, every fool knows
they should have licensed the software ... it's so ironic.

MacWEEK: Is it too late?

Gates: Oh no, nothing's ever too late. Apple is in a unique position, you could
say an exciting position, of being one of the two desktop standards but the
smaller of the two, the minority standard. And so it's incumbent on Apple - Apple
can never rest on its laurels. You know, every, I don't know what period you want
to take, but say every 18 months or so, they have to renew the Mac advantage.
They have to move out front. And it means taking some risk. It means taking the
boundary of software and doing some things that the alternate standard has a
harder time doing, because the hardware companies are all competing with each
other and they're separate from the software design.

The Mac is not as simple as some people paint it to be. It's relatively less
complicated, let's say. And Apple has all these opportunities to go out and do
new things. Clearly, the user interface is a primary one. ... I mean, let's be
serious. Take the Apple Mac interface - it hasn't changed that much. To the
degree it has, if you really understand the nuances like window menus and drag
and drop and things like that, not to toot our own horn, but Excel and Word have
been the source of more UI inspiration that has spread across a broad range of
applications than the style guidist gets. Go look in the Style Guide about using
the keyboard.

There is a keyboard on the Macintosh. It's this great secret, and you might be
able to actually ... give it commands. And so Word and Excel do that and other
apps don't know - oh, it's not in the Style Guide. Are they [the other apps]
supposed to do what Word and Excel do? Are they supposed to do what Style Guide
does?

Take tool bars. Are they supposed to do [what they do] or not? So anyway, there
have been some evolutionary improvements but not the kind of thing that is
probably incumbent on Apple in its position to do. So there's a lot with user
interface.

[Regarding] CD of course ... that message I think Apple's got. They didn't get it
soon enough to really put CDs on any sooner than the Windows platform did. I
mean, it's just about the same. The percentage of Macs with CDs is not that much
different than PCs. I mean, some people are confused about that. Unfortunately,
that didn't turn into the lead-time advantage that it could have been at one
time.

There's a lot that Apple hasn't done in terms of servers. I still think they're
sort of missing out on something there. As they push forward in user interface,
clearly pushing the connections to these higher speed networks, the so-called
information highway ... [it] will be a major opportunity.

It's a very competitive world. Every idea gets adopted in all the environments
pretty rapidly nowadays. So you've got to pick something where you can go to your
... chip level, do some integration, [and] go to the system level and the system
software level and do something that pulls in those elements.

MacWEEK: Maybe Apple should become NT-oriented ...

Gates: Well, actually Sculley early in his career came up and asked if Apple
should do a Windows PC and my answer was no way should they do a Windows PC,
because Apple has this unique role. And yes, Apple should make their products
connect up to NT servers. There's no doubt about that. And as long as they're
making PowerPC hardware, maybe they'll have some other system software, some
bundled, and NT can be put onto that.

But that's not their main role in the world. Their main role in the world is to
push a unique approach to hardware-software integration with the unique elements
around that. ... The way that they're offering some Windows compatibility [for]
some of these models and licensing MS-DOS for us for the 486 plug-in card to the
610 ... makes sense, because it's just an adjunct to let their customers get in
and do something. In the same sense, they may offer NT on some of their PowerPC
platforms. But it doesn't make sense [for] the main strategy. It's pretty
straightforward because NT will be there.

MacWEEK: So to summarize, you would still like to see them license the OS?

Gates: ... The issue is not what I like or what I dislike. They made a mistake in
the early days by not licensing it. And to license system software, you have to
have a certain cost structure. And their cost structure is still too high to be
able to do that at competitive prices. There's a lot of changes that would have
to go on in order for them to do that.

Microsoft has such volume that we license system software for low prices. Our
price for system software ... just goes down as the volume goes up.

MacWEEK: This brings us to your next system software. Why don't you talk a little
bit about Chicago. How does Chicago compare to the Mac OS?

Gates: [There's] a [customer] feedback loop that helps us know, for example, that
it's hard to set up a printer; that it's hard to add fonts. So every time we
cycle a new version of Windows, about every 18 to 24 months, we take all that
feedback and improve these things.

We look at NeXT, Solaris, OS/2, whatever else is out there to see what good ideas
might exist. But in general, the thing that's always going to set the priorities
is user feedback.

So there's a new version of Windows coming late in 1994. In no sense is there an
effort to say, "Oh, the Mac has 14 percent. Let's get it." Rather, the goal is to
get the existing installed base of [Windows] people to upgrade. By the time we
ship Chicago, there'll be over 50 million Windows users. If you can sell an
upgrade, even at $80, to all those people, that's $4 billion. That's the biggest
software number there's ever been.

MacWEEK: But if you do the best job you can in evolving Chicago, do you think
that what you'll end up with will close the gap between the plug-and-play
capability of a Macintosh?

Gates: You're saying: Will Apple still be able to rest on 1984 laurels?

MacWEEK: Well, if you want to say it that way.

Gates: It's a complex thing that users will have to compare. The Mac, for all
those years, didn't have a portable machine, and then they did very, very fine
portable machines, and that was of immense benefit to them. There were all those
years their price premium was higher than it probably should have been for
long-term health. And then they went and fixed that. And that helped their volume
quite a bit.

And so Apple's [had] success, particularly with the incredible loyalty they have
within their installed base and the size threat. I mean, it's over a million
machines shipped during that last quarter - that's pretty good. And you know,
there are markets where their share of the market is very, very high, where just
taking the general market indicator is very misleading.

So I'm a believer that the Mac will continue to be very healthy and growing ... I
said that in 1984, I said it in 1985 when Apple lost money and Steve left, I said
it in 1986. I've said it every year that the Mac is absolutely a critical mass
and can grow and do well. I can still sit here and say geez, I wish Apple would
do even better, because the more Macs they sell, the better it's going to be for
me.

So from time to time I'm, you know, glad to offer some advice. I'm basically
quite confident that despite the fact that all these other operating systems
continue to improve, they'll find a large and increasing role.

MacWEEK: From an OS standpoint, what can Apple do better?

Gates: Well, there's so many things.

MacWEEK: Anything stand out in your mind?

Gates: Well, people should understand that the Mac OS is not a multitasking OS.
The whole thing about the way they hooked those INITs in, that's crazy. The way
they thought they did dynamic linking libraries, and the way that some of this
integration stuff is being done. It's just not right. But they first have got to
get to multitasking.

MacWEEK: We've heard that Chicago is married to the Intel processor 100 percent.
In fact, somebody at Intel told me 110 percent. Is that true and what about the
portable operating systems NT and Cairo?

Gates: Well, Chicago is a mix of C code and native code. And so Chicago is not
targeted for non-Intel processors. NT is our portable operating system, and Cairo
is the code name for the a major set of enhancements we're building for NT. So
just think of that as future NT. That's our portable operating system.

MacWEEK: And Chicago?

Gates: We could make Chicago portable. We'd just have to go back, there's about a
third of it that's in native code that we'd have to put it into C. But we don't
see any need for that. So Chicago will only be, at least based on our current
plan, on the Intel platform.

MacWEEK: Why are Microsoft and Apple fighting over OpenDoc and OLE? And why
should users care?

Gates: This OpenDoc thing is getting confusing. In the final analysis, Word and
Excel are going to take advantage of every new Mac feature and constantly
improve, and this stuff will get figured out. There are many standards.

Microsoft, as an application provider, will always follow the Macintosh APIs when
they're concrete, and [Apple] gives us the information that allows us to do so. I
always think whoever's system software it is [will] set the API standards.
Sometimes Apple gets confused about these things.

This is just one of these things that, you know, if you had a column that said at
the top, "Only people who are interested in sort of random things happening
inside the industry should read this column," then we could have this whole
chronology, the OpenDoc weirdness.

MacWEEK: It's written down?

We have the chronology. We must have written it down for some reason. But there's
no headline here where some end user has something to think about. There's some
things to be worked out. There's a lot of customers with mixed Mac and Windows
environments. And we're always saying to Apple, hey, why don't you use us, you
know, we're Microsoft, to go around and say that Macs and Windows machines work
well together.

I mean, why do you ... put discontinued Mac software, like 1-2-3, in your ads and
not put Excel? You know, Excel could sell a few copies and we're very committed
early on to your platform and stuff like that. You know, why don't you show some
openmindedness to having there be a message that yes, there is a machine other
than Macintosh. I'm sorry, it's true.

So we get into these things, but you know, at all times we swallow our pride and
move ahead to do whatever it takes to do great Mac software. And OpenDoc vs. OLE
is just one of these things. OLE says it's out there, people are doing stuff with
it.

Hey, Apple's got to pick pretty carefully which areas they decide to just match
what's going on in the world, and which areas they decide to be better than the
rest of the world. If they try to revolutionize every aspect ... Let's use
AppleTalk protocols and our twisted-pair thing and our disk size. If they try to
do too many things, then it dilutes the impact of really what they could and can
do, which is to focus on things like interface ...

And some of this object layering stuff, which, if I start to get into some
specifics ... it's confusing even to insiders. Some of this object structure
stuff is a very poor place to try and build a competitive advantage. And so this
is one of those things that will get worked out.

MacWEEK: On the other hand, you guys at Apple and Microsoft seem to have come to
terms over AOCE. A nice announcement at Macworld.

Gates: Yeah. Microsoft ... will always follow on the Macintosh whatever APIs
Apple wants to promote. ... And they give us the information that allows us to do
so. But, when it comes to Windows platform, sometimes they have this notion that
they can set the API standards on the Windows platform. Well, that's fine, good
luck to them. What's the revenue stream? You know, I don't charge people. Apple
charges developers all this money. I don't know if you realize it. I pay an
annual fee to say A and then an annual fee to say P and then I pay for the second
P and I pay for the L and then the E. The number of annual fees we pay for all
these little things ... It's unique to the Mac environment, and it's grown up
sort of this unstated, you know, hey, let's be nice to someone type thing.

Anyway, in the Windows world I always think that whoever's system software it is
is likely to set the API standards. So when somebody says, we'll quit trying to
be the multimedia standard in the Windows environment, my answer is, no, video
for Windows is bundled with Windows. What's the likelihood? If they can ever do
it, fine, it doesn't hurt my feelings. But it's such a waste of time to pretend
that they can do that. Let's say they give it away free. They decide no, they're
not worried about profit. So what, it's still an add-on that every end user has
to get. It's not going to be in the box with Windows, and why would an app
developer write to something ...

So sometimes Apple gets confused about these things. The classic of all time was
when Apple calls up Microsoft System Software Group and offers us QuickTime. They
don't say under what terms, so it's very confusing. And so they're telling our
System Software Group about QuickTime, and they have never talked to our
applications groups, the guys who really help sell Macintosh - never told them
about it.

And so we had to have permission from Apple to have our system software people
tell our application people about it. Well then, the very day we were calling to
ask permission, they have Lotus demonstrating QuickTime in an application, where
they clearly gave them the thing way in advance. So you know, strange things
happen.

But in AOCE, we're all supporting everything Apple's doing there. And they've
been pragmatic. They realize they want AOCE messaging environments to work with
Microsoft messaging environments. And so we're working together to build the
connections that work there. That was a very positive announcement. We were
really pleased to do that. And that's been a group, if you go back historically
in Apple, that has not treated Microsoft all that openly, and so it was a
particular milestone for us with that group.

MacWEEK: If companies were people, based on the descriptions of some of the
interactions you have described in this interview, would Apple be described as
having a paranoid neurosis?

Gates: No, no ... if Apple were one person, you wouldn't see anything like this.
They'd have a clear, consistent view of what they want to do. But Apple is many,
many people. It's a reasonably sized organization. And the notion of: What are we
going to do with Microsoft? What are the things that help us? How do we make sure
things are focused in those areas? They could be more consistent about that. But
it's many people. And these things do get worked out. You know, we've been able
to ship great Mac system software. When it finally came down to it, you know,
fine. We found out about QuickTime and, boo, we very quickly shipped products
that had good support for it.

But I mean, eventually people are very pragmatic and they say you know, we kind
of like Microsoft Mac Office. And then they call us up and fortunately we have
developers who can do things very rapidly and it all works out.

So, I don't even know how much it's worth airing any of this stuff. It is hard.
It is made hard for us, because they know we're totally committed to the Mac. And
they know they can abuse us to any degree and it won't shake that commitment. We
have nothing we can say to them; what can we say? We're just going to do our
best, with whatever information [they] are willing to give us; we'll do our best.

MacWEEK: Has the transition to Michael Spindler as Apple CEO changed anything in
your estimation?

Gates: I had a very good relationship with John Sculley, and I met with him on a
pretty regular basis. I had an excellent relationship with Steve Jobs.

MacWEEK: Are we down to "good" now?

Gates: Well, I met with Mike [for the first time] at Comdex. We had a worthwhile
conversation. And I'm sure we'll keep that dialogue up. He's a no-nonsense guy.
He wants to get the company focused on some important things, and I feel like I
can prove to him that it's worthwhile in many ways working closer with Microsoft.

MacWEEK: How would you portray your attitude toward the Macintosh it if you were
to sum it up in a sound bite?

Gates: We're the most committed developer for the Macintosh. And it's for all the
right reasons. We have people here who love the Macintosh and think everyday
about what they can do for it. Our Macintosh business is a very profitable
business. We have a great base of users that help guide us in making the right
trade-offs in our Macintosh business.

You know, it's also saying that it belies the kind of complex things people write
... like when the Knife says that we're targeting against Macintosh with Chicago.
Why would that be? To go after that last 14 percent? I mean, so there's a bonus
to go after the last 14 percent. The company does very, very well every time a
Macintosh is sold - actually, still better than we do when a Windows PC is sold.

And you know, when other things came along like NeXT or Sun or Amiga or things
like that, we took a look to see if we thought those things would sell, whether
they'd make money. And we decided they wouldn't. So we decided not to dilute the
effort that we put into the two desktop standards.

And most of the other developers went off thinking that they could repeat on
those platforms what happened [with] Microsoft and the Macintosh, that is, where
you see the potential before anybody else does, you make a huge commitment to it,
and by executing very well on that, you grow your position and learn the kind of
things you're going to need for software. And if you try on all platforms. People
then looking to re-create that.

So when I look at those platforms and I make the decision, boy, we're not going
to support that, it's one of the riskiest decisions I make. I mean, it can pay
off, because it keeps our group so focused on doing the right thing. But if you
miss, you're never going to catch up. You're not going to come in late on a new
platform, and so there's been a huge divergence between what Microsoft's platform
strategy has been and all the other software companies. We should be compared to
the other software companies. Write down the Mac loyalty index of us vs. the
other software companies. If we don't get five mice and the next guy gets two,
then your criteria are skewed somehow.

MacWEEK: No, we give diamonds, not mice.

Gates: Sorry, that's MacUser.

MacWEEK: We're all part of the Ziff-Davis family, it's all right. Okay, I only
have one other question. Other than the PowerPC, what other RISC platforms is
Microsoft working on?

Gates: Well, first, we think ... the X86, is going to have the lion's share of
the volume for the foreseeable future. ... People are a little confused right now
about benchmarking and what these performance numbers are.

In any case, we did a MIPs version of NT, [and] on the same day we shipped the
Intel version, we shipped the MIPs version. And then we worked with DEC and got
the alpha version out right after that. So the three versions of NT ... today are
Intel, MIPs and alpha. And we have said that we're working with Motorola and IBM
on the PowerPC version. And there may be some other versions that get announced
as well.

There's marginal effort to put NT on a new processor platform if it's any kind of
reasonable processor... So that's never an issue.

MacWEEK: How do you think the transition to PowerPC will go?

Apple [sold] a million Macs last quarter. As they grow their business, they'll
sell more than a million PowerPC Macs at some point. How rough will the
transition be? It'll be a finite period of time when things are a little
confusing. But it's not a major thing.

You know, the Mac has had the luxury of never having this kind of transition.
Intel processor, Intel-based machines, Windows machines, whatever you want to
call them, went from the 8086 to the 286, which is a different memory model - an
immense change. Then they went from the 286 to the 386, which was an immense
change. And the 386 transition, you could say it's still going on. That's the
last transition. And everything after 386 is just very high-speed 386.

So we've had the same cleanliness that Mac had, with small footnotes, throughout
its history ... throughout the 10 years, the PC has only had that really sort of
since '87 when the 386 came into being.

Now for the first time the Mac has a little bit of a transition here where you
can't take per disk and run it, at least not at any kind of full-speed way, in
the next machine. But they'll spend some money, they'll push the ISPs, they'll
get over that. That doesn't mean there might be one quarter where things were a
little dicey and a few accounts say: Oh, this is not worth the trouble. Sure,
there'll be something like that. But it's not a major thing. I think when you go
back and look at it, you look at Mac sales volumes, you know, it will look like
this and you'll have to put a little mark there and say this is the PowerPC Mac.

In other words, I don't think you'll see a dip ...

It's a nice evolution of the Mac with a little bit of transition pain.

MacWEEK: Do you see PowerPC having a significant upward push on Apple's market
share?

Gates: The 601, 603 - those are good chips and they will help the Mac to grow its
share, but I don't think you'll see a big blip. Basically the history of chips is
that if you think one chip guy is doing something magical, the other chip guys
are doing something, too.

MacWEEK: Thank you very much for your time, Bill.

Gates: I hope everybody knows how much I love the Macintosh.

(c) Copyright 1994 Ziff-Davis Publishing Co. All rights reserved. This material
may not be reproduced in any form without permission.