It’s the law, stupid

In the feds' antitrust case, Microsoft runs afoul of the big, dumb world.

THE PROSPECT THAT Microsoft the monopolist may be broken up by the government raises the question: Who gets Bill? This company is still profoundly the creation and extension of one man—the founding entrepreneur whose vision, tenacity, arrogance, and ruthlessness are at the core of Microsoft’s success.

Microsofties believe they are part of an elite, the smartest of the smart; they are all wired into Gates and assume his essential infallibility—the company’s dominance and their personal wealth prove it. A huge question is whether Gates’ influence will be diminished under any reorganization plan. If it isn’t, one could argue the case didn’t really cost Microsoft much. But if, say, Microsoft is chopped up into several “Baby Bills,” the ones left behind without Bill may be regarded as litter runts because they lack their most valuable asset. Bill is the very center of the company’s operating culture—an active demigod in the company’s operating mythology.

The cult of Bill is an old one. It certainly extends back to the Lakeside School, where he was placed by his mother to ensure his safety against locker-room bullies. There he was considered the smartest of the smart by most of his teachers and classmates. That cult lives on at Lakeside, as evidenced a few years ago when Bill came back to his alma mater to share his vision of the road ahead. In a packed field house full of parents, students, and alums, he was introduced along with Wilber Huston (class of ’29). As a Lakeside student, Huston had been selected by Thomas Edison as the smartest boy in America, and this evening was clearly a passing of the mantle: The unspoken consensus seemed to be that Bill was not simply the successor to Wilbur Huston, but was Edison reincarnate.

Gates’ operating style has been to brand competitors, employees, and ideas he does not understand as “stupid,” or “brain dead,” and that line of defense has been the operative one in the antitrust case. It has been axiomatic at Microsoft that the Justice Department is stupid because it doesn’t “get” the fast-paced, Darwinian world of high tech that inevitably leaves dim-witted competitors in the dust; that Judge Thomas Penfield Jackson is stupid because he doesn’t understand software and many of his decisions are overturned on appeal; and that the government is stupid for trying to kill the golden goose of our economy by interfering with the software giant’s growth.

WELL, MAYBE THEY are all stupid. But life is not a meritocracy: The smart don’t get to make all the rules just because they’re smart. Power resides in many places in America and can be exercised when various political and economic sectors are aroused. That “dumb” people can tell Microsoft how to behave seems tremendously unfair to those who think the world would be better off if it operated by Bill’s rules.

Gates was slow to recognize the power—even the relevance—of government. In the early ’90s, his legal people begged him to invest more in lobbyists, lawyers, and congresspeople. But Gates lived in something like a libertarian wet dream: His successes were his own. Unlike many hardware firms, he wasn’t subsisting on government contracts. He was the smartest—soon to be the richest—man in the world, and he’d gotten there, against great odds, with little help from anyone else. Or so it seemed.

Of course, the laptop libertarians of Redmond tend not to credit government with anything—apparently our roads, bridges, utilities, schools, and social safety nets sprang up organically as the result of private initiative. They want government to get out of the way. It’s the solipsistic trap many entrepreneurs fall into: Only one reality exists, and it emanates from them.

Gates has certainly learned the relevance of government now, and he is learning to play the game better (a more respectful pose to the judiciary being one sign; more lawyers, consultants, and public relations people another). But the lesson has come too late for Microsoft to maintain its image of self-sufficiency.

From the findings of fact in the antitrust case, it looks as if Gates will forever after have to acknowledge that Microsoft is not alone; that it has “partners” it may neither want nor have sought; and that these partners will not be denied their role in making the company adhere to both legal and social rules of behavior. And that they don’t have to be as smart as Bill to wield real power.

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