Bill Gates answers tough questions on Microsoft’s recent failings [video]

By Tom Warren, on 18th May 11 6:22 pm with 24 Comments

Microsoft co-founder and Chairman Bill Gates has defended the company’s recent failings.

Speaking on the BBC’s Hard Talk program, 55-year old Gates answered questions on Microsoft’s loss of innovation and the potential death of the PC. Stephen Sackur, a veteran BBC journalist, posed the questions to Bill Gates in a 30 minute interview recently.”Is it painful for you to watch Microsoft lose its innovation field leading edge?” asked Sackur. “Well Microsoft is doing a lot of great work, Microsoft always has some things that are going super well, some things that it needs to do even better,” said Gates. The BBC interviewer agreed, noting that there are some areas where Microsoft has done well in recent years with the exception of phones and tablets he argued, “Microsoft has been left behind” in the handheld revolution Sackur asserted. “I wouldn’t say that,” argued Gates. “I’d say there’s companies doing very good work in that area, I think that the phone has become very software centric. It’s software approaches that are succeeding there.” Gates noted that reading and media is moving onto digital devices and that “Microsoft has to create the best device for those scenarios.”

Gates also downplayed Apple’s market valuation. “I think stock prices aren’t really the best gauge, stock prices can go up and down. I would be the first to say there’s several tech companies including Microsoft, including Apple, including Google, who are doing fascinating work. The importance of software is more evident to people today than it’s ever been.” Sackur’s final questioning was around the post PC era and whether the age of the PC is coming to and end. ”The PC is the tablet, all these digital devices are going to work together. You’re going to see PCs where saying “is that a tablet? is that a phone?” the words are going to change because the innovation is so rapid,” said Gates.

Gates also discussed Microsoft’s role in buying Skype. “I was a strong proponent at the board level for the deal being done,” said Gates. ”I think it’s a great, great deal for Skype. I think it’s a great deal for Microsoft,” he added.

You can watch the full 30 minute BBC interview on iPlayer or catch the best bits below.

  • RWalrond

    Bill Gates is a class act. The exciting thing about technology is that it changes so fast. The fact the Microsoft is still actively creating solutions today is not struggling to make a profit is fantastic news for all of us. This is also true for Apple and Google. I think the more healthy these companies are, the more inovation we will have.

    I would argue that Microsoft isn’t innovating less, but that other companies have finally decided to start innovating more instead of sitting around complaining that Microsoft has an unfair advantage. 

  • RWalrond

    Bill Gates is a class act. The exciting thing about technology is that it changes so fast. The fact the Microsoft is still actively creating solutions today is not struggling to make a profit is fantastic news for all of us. This is also true for Apple and Google. I think the more healthy these companies are, the more inovation we will have.

    I would argue that Microsoft isn’t innovating less, but that other companies have finally decided to start innovating more instead of sitting around complaining that Microsoft has an unfair advantage. 

  • Anonymous

    I love these kinds of interviews. I agree with Bill on many of the points he made specifically on the mobile front. Many people are quick to point at MS’s failure to capitalize on the recent boom in the smartphone market.Yet recently a study revealed that only about 10% of cell phone users use a smartphone. So clearly there is room to grow. 

    MS wasn’t the first company that made a PC, they were the first to strike a balance that appealed to the masses. This is what they do. They may arrive late but they deliver.

    • Mark

      That’s all true. But the Chairman of MS shouldn’t be happy with what’s happened in the mobile and tablet markets. These aren’t the many industry developments MS missed completely. These are areas they actually targeted early and had a huge first mover advantage. But both were blown through poor management, a lack of innovation,  and even worse execution.  It still may be early days, but someone like Bill should be trying to find out why MS consistently misses new markets, fails in markets it was early too, and in all cases seems to take forever to respond. 

    • RWalrond

      If you listen to what Bill says, you will hear him refer to Microsoft as a software company and that they will write software to whatever device runs software. Because Apple has made a great media device, we somehow forget that Microsoft makes more money selling software than hardware. Porting Windows to ARM allows Microsoft to push their software onto iPad like devices. But being a software company also allows Microsoft to target the most popular hardware even if it doesn’t run their OS.

      These folks interviewing Microsoft brass should be asking them what software innovations they will be bringing to the tablet/mobile space now that the hardware has finally gotten to a point that you can have the power of a PC in the palm of your hand.

    • Mark

      I heard that part. What I didn’t hear was how he plans to compete against the software from Apple or Google, or more importantly the business models of Apple (huge profit per device) or Google (free software, make it back in search advertising) versus MS (tiny prodit per OS license sale).  And like I said, he seems to be excusing a whole lot of major failures that frankly should be very concerning to him with regards to MS’s future.

    • RWalrond

      What software from Apple and Google? Apple is making money from its devices and
      taking a piece of each software sale on their devices. They’re not making a
      killing off their own software. Google primarily makes its money from ads. What
      has Microsoft done in the cloud compared to Apple or even Google? How does
      Google Docs compare to Office Web Applications? Furthermore don’t think Bill
      Gates would complain about MS’s profits, they’re making enough money to burn. I
      would like to hear what these major failures are, because if you consider all
      that Microsoft has been doing over the last 10 years a major failure, I would
      like my company to fail twice as much, Microsoft Style!

      As I pointed out I think we could have gotten much more out of that interview if
      they asked him more forward leading questions. You could tell he didn’t want to
      get into the Skype deal and what that + Microsoft research could bring to the
      table. I suspect because of the way the interviewer decided to approach that
      question by trying to make Microsoft look like idiots for purchasing Skype,
      instead of probing to gain insight into the thinking behind the deal.

    • Mark

      The two leading smartphone OS’s: Android and iOS. Apple is making a ton of money off their devices (tens of billions just in profits) and a substantial amount off the software via iTunes, the app store, and most recently mobile search. And do you really need me to list the major failures over the last five or even ten years? How about I just leave it at losing two markets where MS had a decade headstart (mobile and tablets)?

      Gates didn’t want to get into justifying the Skype deal because it can’t be justified financially. And telling the truth – we overpaid to keep it away from Google - isn’t exactly something he wants to admit for obvious reasons. The interviewer did what he always does – asked tough questions. They’re the same questions the market has been asking recently and for ten years now.

    • Shiro

      Sprint did not offer Windows 7 phones on their website until 2 weeks ago.  I think there is still room to grow a Sprint. 

  • George-king

     You have to wonder about the group think of the tech press.  They all seem to parrot the same line – Stalin or Mao would be proud of them.

    The PC is not going away any time soon.  There is not a tablet yet that is built for serious computing – mathematical modeling, intense video or graphics work, etc.  This is the problem of trying to view everything through a consumer model – of trying to fit a round peg into a square hole.  

    • Stark

      OMFG WTF tabletz FTW PC is dead you’re loosers, touch screen is teh pure awesomness!!11one1!!

      Kthxbye, Sheep


    • Anonymous

      I really don’t see how tablets could actually be much productive no matter how innovative the technology. This bullshit that the PC is dead is stupid. It’s like saying a mini cooper which has four wheels and drives you to point A to point B will take over the market and Trucks and SUV are dead. That will never happen and this is where Microsoft has their head in the right place. They believe in unifying all these other devices but whoever wants to get the hard work done will have a Truck or an SUV.  

    • Andrew B. Ware

      thank you for that last line 

  • David Garnett Welsh

    Microsoft hasn’t ’failed’ majorly recently, neither has it lost innovation. Like BillG says, there has been Kinect and some really cool Bing stuff (some stuff Google has wanted to copy for itself).

    Failures have been not expecting and responding to the shift to mobile, and Vista, but nothing catastrophic that has seen a possible downfall of the company. Windows 7 and Office have been the best selling year, GoW 3 has just broken 1 million pre-orders and Xbox is the highest selling console this year.

    Like George-king says, the PC isn’t going anywhere soon, are businesses and organizations meant to use tablets and mobile devices the whole time? The mobile device is for an individual, not for anything else. 

  • BoogieMan_Lowko666

    I believe WP7 could  be huge if it wasn’t for the biased Sales Reps. I bought a MT4G and was disappointed by a lot of things. I ended up selling that puppy on ebay and got enough to buy the Samsung Focus in cash. When I went to go “look” around the T-Mobile store; I was surprised by the b.s. I was getting. Do these reps get paid by Google/Android? Seriously, every time I wanted to ask questions (although I knew enough about the wp7) about the HTC HD7, these guys were pushing hard for me to purchase a Android device. I cancelled my contract on the spot and went with AT&T and got the Focus. I love it. When the Nokia Windows PHone drops, I will be getting that too…. regardless of which carrier(s) get it. Seriously, someone needs to look into this B.S. It seems that these reps are told to sell as many Android phones. Liltte-by-little Windows will be up there. My friends are digging my Samsung Focus… I LOVE THE MUSIC PLAYER! Sorry for my english, not too good.

    • Anonymous

      I have had the same experience at TMobile and they tried to get me to buy Tmobile 4G when i bought my HD7. I think Microsoft needs to do something about it because this accounts much to their sales. Let’s hope we see that change. 

    • andrewbware

      I totaly agree! thank you for pointing this out — it’s so true

    • Los

       very very true. I got that when I got my HTC Arrive, the Sprint reps were trying to push the HTC Evo 4G on me

  • Guest

    bill <3 

  • Diego3336

    The media is biased against Microsoft, that’s the fact.

    Have anybody heard about iPhone 4 “SIM Card Failure” problem? I didn’t until I heard a friend complaining about it and I searched on Bing and got tons of results from people complaining about the same problem. Just Bing or Google for: iPhone 4+SIM Failure 

    Or about tons of iPhones with “no sound” problem? Another friend of mine had this problem just 3 days after purchase his iPhone 4. Bing or Google for: iPhone 4+No Sound

    It’s just 2 examples, and I never heard anything about these issues on the “specialized media”, but when a problem occurs with a Microsoft product, you see everybody saying and pointing Microsoft as the guilty by default, like the pre-NoDo update problems with Samsung devices.

  • scrolless

    At the beginning, the PC was synonymous with the Desktop. Then the term was incorporated to include the Notebook. Why can’t the same be done for Tablets? Just because other competitors are creating new OSes for that doesn’t mean that it is a totally different universe of (P)ersonal (C)omputing. Essentially you still do the same things – facebook, twitter, productivity, small games, music, etc.

    What led to people thinking that it is a Post-PC era is because of Microsoft’s perceived lack of a tablet-friendly solution, and being slow to implement it. If it is really a Post-PC era, taking into account the name’s implication of desktops and notebooks, why isn’t Apple scraping Mac OS X altogether since it is leading the tablet wave?

    That is because Tablets will grow, but the traditional computing stations will remain, and evolve to include much more sensory applications and eventually become immersive computing environments. Take this as an example: With both hands holding the tablet, there is no chance at all for Kinect-like motion sensors. The tablet form factor is not everything that can be offered and so it cannot replace the computing stations.

    Windows 8 will address these tablet-centric features which are exclusive to this ‘new’ form factor. It is a risky bet because Windows 8 is not only playing catch-up, it also has to overtake the competition with new innovation (cloud, kinect, etc).

  • Translatethis27

     Gates! show us the sales of Windows Phone is it a Failure? I am a Nokia share holder. Microsoft show me the sales!!!!!!!!!!

  • zzz

    Wow, that interviewer is way over his head.  AAPL is ”dwarfing” MSFT because it’s “tens of billions” worth more? WTF?  300B vs 200B is “dwarfing?”  His other jabs at MS were even worse. All just a series of bad assumptions and misleading characterization of events.  I guess that’s not atypical of many under-informed consumers these days, but you would think a BBC reporter interviewing B Gates should know better.  *sigh*

    Gates was a gentleman holding back like that.  I see he did LOL’ed and almost jumped out of his seat when the guy said Apple is dwarfing MSFT in market cap.

  • Guest

    The future belongs to webOS with fully connected devices (you can even run webOS on PC – not possible with iOS):

    Why? Check this: