I D É E S   F O R T E S    Issue 1.02 - June 1995

Bill's Bet-the-Comapny Strategy

By Dave Winer

The software users have outfoxed us again. It happens every 15 years or so in this business. We developers lost our grounding, the users rebelled, and a new incarnation of software industry was created.

What is this new incarnation? The Internet, of course. Its potential has barely been explored, and it's changing at an incredible rate, almost on a daily basis.

There's a rebellious spirit on the Internet: Net users are fighting the greedy venture capitalists who funded the software industry and were too busy inventing scams to make Mitch Kapor-style money. (The scams didn't work.) And they're revolting against Bill Gates, who has already made Mitch Kapor-style money, many times over, and possesses something much more offensive: Bill holds the power of FUD - fear, uncertainty, and doubt.

In the software business, instilling FUD in consumers - persuading them that there is no chance another company's product will work - gives a business the power to set the agenda, to make users wait for its product. It isn't entirely negative. FUD makes it possible for there to be an agenda. If the industry is run by random idiots, this is preferable. At least we're going somewhere, even if Bill always gets to name and play the tune.

But FUD often leads to inbred thinking, a stifling of ideas, stagnation. FUD is the opposite of FUN. Fear paralyses. Eventually, either you break down and are destroyed by FUD or you break out and find a new way of coping.

Breaking out is what created the Internet. People were sick of being told what they could share and how they could communicate by company and government bureaucracies, so they took to the Internet. While the software industry was obsessed with Bill Gates and what he was telling us that the users actually needed from software, the users themselves decided to stop waiting to be told when they could get Internet access. They just signed up.

Now the tail is wagging the dog - users are in control. The old software industry is struggling (even flailing) not to look like random idiots. The next versions of Windows, Macintosh and OS/2 are all Internet clients, and they support all the standard Internet services - gopher, WAIS, ftp, telnet, Mosaic, newsgroups. This is incredible because none of the platform vendors had any say in the definition of these standards. It isn't based on OpenDoc, OLE 2.0, Kaleida, Taligent, AppWare, or any of the various database standards that ex-Borland president Philippe Kahn and Bill Gates were arguing about several years ago. Or even MAPI or VIM. Remember OCE? Do you remember how terribly important those things seemed at the time?

I think Bill got caught flat-footed here. At the Agenda 95 conference in September, I was surprised to hear him say that Microsoft's upcoming online service, the Microsoft Network, is a bet-the-company venture for his empire. But now I think he's right. Bill is scrambling, he understands the stakes, and is doing the only reasonable thing he can do. The stakes are huge for him at a personal level - he could be the next Ken Olsen. Remember that Ken Olsen, for most of the years he ran DEC (Digital Equipment Corporation), was a hero. Is it possible that the Microsoft Network could become the failed DEC Rainbow PC of online systems?

Who remembers the Rainbow, or even Ken Olsen, now?

Bill can bring Apple to its knees. He may have Novell pinned down. Microsoft is a very impressive company. But the Microsoft Network can't compete with the Internet. Once the users take control, they never give it back. They allow a new industry to form, let the old one wither and fade, even die, and then repeat the process all over again. It happened in the transition from mainframes to minis, in the transition from minis to PCs. And it's happening again.

The Microsoft Network may end up being the IBM PC of the online world. I bet a lot of people will use it. But Microsoft has too heavily invested in the way things are to let it grow in the random way the Internet is growing. The innovative fun stuff will happen outside the reach of Microsoft's FUD.

Dave Winer (dwiner@well.com) is a software developer and essay writer. Dave writes about whatever is on his mind, and sends it out to the world via DaveNet, an e-mail subscriber list.