Steve Jobs vs.

Bill Gates interview in 2007 PART 1

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http://allthingsd.com/20070531/d5-gates-jobs-transcript/
Following is a transcript of the interview Kara Swisher and Walt Mossberg
conducted with Microsoft Chairman Bill Gates and Apple CEO Steve Jobs at
the D5 conference on May 30, 2007.
[Video plays]
Kara: Well, thank you.
Walt: Before we get started, there were some pioneersof course, we have
the pioneers here on the stage, but there were some other really important
pioneers in the video we just saw and a couple of them are here in the
audience. Mitch Kapor, who is a regular, could you just stand up, wherever
you are? There he is.
[Applause]
Walt: And Fred Gibbons, who has not come to D before, but is here tonight.
Fred. Theres Fred right there.
[Applause]
Walt: And I dont know if hes in the room, but I do want to recognize our
fellow journalist, Brent Schlender from Fortune, who, to my knowledge, did
the last joint interview these guys did. It was not onstage, but it was Fortune
magazine. Brent, I dont know if youre in the room. If you are, can you
stand? Maybe hes way over there.
[Applause]
Kara: So lets get started. I wanted to ask, theres been a lot of mano-amano/catfight kind of thing in a lot of the blogs and the press and stuff like
that, and we wanted tothe first question I was interested in asking is what
you think each has contributed to the computer and technology industry,
starting with you, Steve, for Bill, and vice versa.
Steve: Well, you know, Bill built the first software company in the industry
and I think he built the first software company before anybody really in our
industry knew what a software company was, except for these guys. And
that was huge. That was really huge. And the business model that they
ended up pursuing turned out to be the one that worked really well, you
know, for the industry. I think the biggest thing was, Bill was really focused
on software before almost anybody else had a clue that it was really the
software.

Kara: Was important?

Steve: Thats what I see. I mean, a lot of other things you could say, but
thats the high order bit. And I think building a companys really hard, and it
requires your greatest persuasive abilities to hire the best people you can
and keep them at your company and keep them working, doing the best
work of their lives, hopefully. And Bills been able to stay with it for all these
years.
Walt: Bill, how about the contribution of Steve and Apple?
Bill: Well, first, I want to clarify: Im not Fake Steve Jobs.
What Steves done is quite phenomenal, and if you look back to 1977, that
Apple II computer, the idea that it would be a mass-market machine, you
know, the bet that was made there by Apple uniquelythere were other
people with products, but the idea that this could be an incredible
empowering phenomenon, Apple pursued that dream.
Then one of the most fun things we did was the Macintosh and that was so
risky. People may not remember that Apple really bet the company. Lisa
hadnt done that well, and some people were saying that general approach
wasnt good, but the team that Steve built even within the company to
pursue that, even some days it felt a little ahead of its timeI dont know if
you remember that Twiggy disk drive and
Steve: One hundred twenty-eight K.
Kara: Oh, the Twiggy disk drive, yes.
Bill: Steve gave a speech once, which is one of my favorites, where he
talked about, in a certain sense, we build the products that we want to use
ourselves. And so hes really pursued that with incredible taste and
elegance that has had a huge impact on the industry. And his ability to
always come around and figure out where that next bet should be has been
phenomenal. Apple literally was failing when Steve went back and re-infused
the innovation and risk-taking that have been phenomenal. So the industrys
benefited immensely from his work. Weve both been lucky to be part of it,
but Id say hes contributed as much as anyone.
Steve: Weve also both been incredibly lucky to have had great partners that
we started the companies with and weve attracted great people. I mean, so
everything thats been done at Microsoft and at Apple has been done by just
remarkable people, none of which are sitting up here today.
Kara: Well, not us.
Walt: Not us. So in a way, youre the stand-ins for all those other people.
Steve: Yeah, in a way, we are. In a very tangible way.

Walt: So Bill mentioned the Apple II and 1977 and 30 years ago. And there
were a couple of other computers which were aimed at the idea that
average people might be able to use them, and looking back on it, a really
average-average person might not have been able to use them by todays
standards, but it certainly broadened the base of who could use computers.
I actually looked at an Apple ad from 1978. It was a print ad. That shows you
how ancient it was. And it said, thousands of people have discovered the
Apple computer. Thousands of people. And it also said, you dont want to
buy one of these computers where you put a cartridge in. I think that was a
reference to one of the Atari or something.
Steve: Oh, no.
Walt: You want a computer you can write your own programs on. And
obviously, people still do.
Steve: We had some very strange ads back then. We had one where it was
in a kitchen and there was a woman that looked like the wife and she was
typing in recipes on the computer with the husband looking on approvingly
in the back. Stuff like that.
Walt: How did that work for you?
Steve: I dont think well.
Walt: I know you started Microsoft prior to 1977. I think Apple started the
year before, in 76.
Steve: 76.
Walt: Microsoft in
Bill: 74 was when we started writing BASIC. Then we shipped the BASIC in
75.
Walt: Some people here, but I dont think most people, know that there was
actually some Microsoft software in that Apple II computer. You want to talk
about what happened there, how that occurred?
Bill: Yeah. There had been the Altair and a few other companiesactually,
about 24that had done various machines, but the 77 group included the
PET, TRS-80
Walt: Commodore?
Bill: Yeah, the Commodore PET, TRS-80 and the Apple II. The original Apple II
BASIC, the Integer BASIC, we had nothing to do with. But then there was a
floating-point one whereand I mostly worked with Woz on that.
Steve: Let me tell the story. My partner we started out with, this guy named
Steve Wozniak. Brilliant, brilliant guy. He writes this BASIC that is, like, the

best BASIC on the planet. It does stuff that no other BASICs ever done. You
dont have to run it to find your error messages. It finds them when you type
it in and stuff. Its perfect in every way, except for one thing, which is its
just fixed-point, right? Its not floating-point.
So were getting a lot of input that people want this BASIC to be floatingpoint. And, like, were begging Woz, please, please make this floating point.
Walt: Whos we? How many people are in Apple?
Steve: Well, me. Were begging Woz to make this floating-point and he just
never does it. You know, and he wrote it by hand on paper. I mean, you
know, he didnt have an assembler or anything to write it with. It was all just
written on paper and hed type it in. He just never got around to making it
floating-point.
Kara: Why?
Steve: This is one of the mysteries of life. I dont know, but he never did. So,
you know, Microsoft had this very popular, really good floating-point BASIC
that we ended up going to them and saying help.
Walt: And how much was theI think you were telling us earlier
Bill: Oh, it was $31,000.
Walt: That Apple paid you for the
Bill: For the floating-point BASIC. And I flew out to Apple, I spent two days
there getting the cassette. The cassette tapes were the main ways that
people stored things at the time, right? And, you know, that was fun.
I think the most fun is later when we worked together.
Walt: What was the most fun? Tell the story about the most fun that was
later.
Kara: Or maybe later, not the most fun.
Walt: Let them talk.
Kara: Teasing.
Bill: Well, you know, Steve can probably start it better. The team that was
assembled there to do the Macintosh was a very committed team. And there
was an equivalent team on our side that just got totally focused on this
activity. Jeff Harbers, a lot of incredible people. And we had really bet our
future on the Macintosh being successful, and then, hopefully, graphics
interfaces in general being successful, but first and foremost, the thing that
would popularize that being the Macintosh.

So we were working together. The schedules were uncertain. The quality

was uncertain. The price. When Steve first came up, it was going to be a lot
cheaper computer than it ended up being, but that was fine.
Kara: So you worked in both places?
Bill: Well, we were in Seattle and wed fly down there.
Walt: But Microsoft, if I remember correctly from what Ive read, wasnt
Microsoft one of the few companies that were allowed to even have a
prototype of the Mac at the time?
Steve: Yeah. Whats interesting, whats hard to remember now is that
Microsoft wasnt in the applications business then. They took a big bet on
the Mac because this is how they got into the apps business. Lotus
dominated the apps business on the PC back then.
Bill: Right. Wed done just MultiPlan, which was a hit on the Apple II, and
then Mitch did an incredible job betting on the IBM PC and 1-2-3 came in
and, you know, ruled that part of the business. So the question was, what
was the next paradigm shift that would allow for an entry? We had Word, but
WordPerfect was by far the strongest in word processing dBase database.
Walt: And Word was kind of a DOS text
Bill: All of these products Im saying were DOS-based products.
Walt: Right.
Bill: Because Windows wasnt in the picture at the time.
Walt: Right.
Bill: Thats more early 90s that we get to that. So we made this bet that the
paradigm shift would be graphics interface and, in particular, that the
Macintosh would make that happen with 128K of memory, 22K of which was
for the screen buffer, 14K was for the operating system. So it was
Walt: 14K?
Bill: Yeah.
Walt: The original Mac operating system was 14K?
Bill: 14K that we had to have loaded when our software ran. So when the
shell would come up, it had all the 128K.
Steve: The OS was bigger than 14K. It was in the 20s somewhere.
Walt: I see.
Steve: We ship these computers now with, you know, a gigabyte, 2
gigabytes of memory, and nobody remembers 128K.

Walt: I remember that. I remember paying a lot of money for computers with
128K in those days. So the two companies worked closely on the Mac
project because you were maybe not the only, but the principal or one of the
principal software creators for it, is that right?
Steve: Well, Apple did the Mac itself, but we got Bill and his team involved to
write these applications. We were doing a few apps ourselves. We did
MacPaint, MacDraw and stuff like that, but Bill and his team did some great
work.
Kara: Now, in terms of moving forward after you left and your company grew
more and more strong, what did you think was going to happen to Apple
after sort of the disasters that occurred after Steve left?
Bill: Well, Apple, they hung in the balance. We continued to do Macintosh
software. Excel, which Steve and I introduced together in New York City, that
was kind of a fun event, that went on and did very well. But then, you know,
Apple just wasnt differentiating itself well enough from the higher-volume
platform.
Walt: Meaning Windows, right?
Bill: DOS and Windows.
Walt: OK. But especially Windows in the 90s began to take off.
Bill: By 1995, Windows became popular. The big debate wasnt sort of Mac
versus Windows. The big debate was character mode interface versus
graphics mode interface. And when the 386 came and we got more memory
and the speed was adequate and some development tools came along, that
paradigm bet on GUI paid off for everybody whod gotten in early and said,
you know, this is the way thats going to go.
Walt: But Apple wasnt able to leverage its products?
Bill: After the 512K Mac was done, the product line just didnt evolve as fast
Steve wasnt thereas it needed to. And we were actually negotiating a deal
to invest and make some commitments and things with Gil Amelio. No,
seriously.
Kara: Dont be mean to him.
Bill: Im sorry?
Kara: Just saying the word Gil Amelio, you can see his
Bill: So I was calling him up on the weekend and all this stuff and next thing I
knew, Steve called me up and said, Dont worry about that negotiation with
Gil Amelio. You can just talk to me now. And I said, Wow.

Steve: Gil was a nice guy, but he had a saying. He said, Apple is like a ship
with a hole in the bottom leaking water and my job is to get the ship pointed
in the right direction.