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COMMENTARY: BILL GATES: EMPEROR OF HIGH TECH, SULTAN OF SPINYou might have thought he was talking about a communist menace--or even an Old Testament plague. What software mogul William H. Gates III was warning the public about was what might happen if antitrust enforcers interfere with sales of Microsoft Corp.'s Windows 98. A delay, declared Gates, ''would affect an entire ecosystem of companies.'' It would ''hurt the American economy and cost American jobs,'' he went on, and even ''...create an opening for foreign companies.'' Come on. Just months ago, Microsoft execs were saying that Win98 was ''no big bang,'' merely ''an interesting upgrade'' of Windows 95. Now that it must fend off an impending suit, suddenly, this Windows ''tune-up'' is the software equivalent of Viagra: a magic bullet to lift PC sales and keep the economy strong. ''ISSUE ADS.'' So where's the truth? Who cares? It's all in the spin. On May 5, as Microsoft braced for a possible federal antitrust suit and the prospect that attorneys general of some 13 states would block the sale of Win98, Gates wildly spun his tale to reporters summoned to a Manhattan auditorium. As Compaq Computer CEO Eckhard Pfeiffer and some 60 noticeably lesser lights looked on stoically, Gates and his lieutenant Robert J. Herbold warned about innovation that would be quashed by government interference. ''What is at stake is the ability to continue to make the personal computer even better and easier to use,'' Gates said. There, to bolster that claim were groups such as the National Center for Disability Services and National Council on Aging. This last-minute effort is the culmination of a Microsoft spin campaign that has been building for months. As the Justice Dept. tried to enforce its 1995 consent decree last fall, the company hired top lobbyists and took out ''issue ads'' that spoke loftily about unfettered innovation in a free-enterprise system. There was even a faux grassroots movement--orchestrated by Microsoft public-relations agency Edelman Public Relations Worldwide and then leaked by a disgruntled agency employee. It's the type of campaign--at once frightening and condescending--that Big Tobacco has run for years. And it's getting the same results: The public tunes out and the prosecutors fume. ''Microsoft is saying that Windows 98 is so absolutely essential to the PC industry that even a slight delay will cause immense economic damage,'' says Connecticut Attorney General Richard Blumenthal. ''If that's true...[there's] more reason to believe the product is so dominant that anticompetitive conduct is especially dangerous.'' It's true some companies will be hurt if Win98 is held up. PC makers, for example, could lose $2 billion in incremental computer sales, figures Michael K. Kwatinetz, an analyst at Deutsche Morgan Grenfell. Ironically, a 5% dip in PC sales would mean only some $40 million in lost revenues for Microsoft, he calculates. Microsoft might have a monopoly in operating systems, but not in hokey PR. On the eve of the May 5 event, Netscape Communications Corp. E-mailed journalists a three-page document containing ''important questions'' we might want to ask Gates. And anti-Microsoft groups, such as the Netscape-backed ProComp, hastily called a counterspin session--outside the Microsoft meeting--attended by reporters too quote-hungry to come in out of the rain. Microsoft's ''was a political PR rally to derail an enforcement effort,'' protested Edward Black, president of the Computer & Communications Industry Assn. (at least from what I can make out of my rain-splattered notes). ''We think we speak more for the industry.'' The best industry spokesman was Ted Johnson, chief technology officer of software maker Visio. Before joining Gates & Co. onstage, he wryly observed the industry debate comes down to a simple goal: ''This is not about curing cancer or ending world hunger. This is about selling more software and hardware. It's not all that noble.''
By Amy Cortese
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Updated May 7, 1998 by bwwebmaster
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