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Bill Gates Steps Aside at Microsoft (1/2)
Last week, Bill Gates retired from full-time work at the world's biggest computer software company, Microsoft. He will remain chairman of the company he established with Paul Allen in nineteen seventy-five.
Mister Gates leaves Microsoft at a time of change in the computing industry. Microsoft grew at a time when personal computers, or PCs, were replacing big mainframe computers as the main computing tools. He showed that huge profits could be made in software as PCs increasingly were found "on every desk and in every home."
Early on, Microsoft understood the importance of the "network effect." That is, software is the kind of product that increases in value as more people buy and use it.
Now, free Internet software threatens to replace PC-based software. Devices like "smart phones" connect people to the Internet. Google has become a leader in Internet Web searching and advertising. Microsoft has struggled to change with the new computer environment. Its efforts to sell music and its latest operating system, Vista, have not been big successes. And an attempt this year to buy Yahoo for over forty-seven billion dollars failed.
