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Though the videodisc is not at the core of Microsoft's business, this is a competition Gates plans to win. The group argues that the $10-per-unit royalty is too low. "Why charge more?" he asks. They explain that it will be hard to make a profit at $10, given what they are putting in. Gates turns stern. They are missing the big picture. "Our whole relationship with the consumer-electronic guys hangs in the balance," he declares. "We can get wiped." Only the paranoid survive. "The strategic goal here is getting Windows CE standards into every device we can. We don't have to make money over the next few years. We didn't make money on ms-dos in its first release. If you can get into this market at $10, take it." They nod.
His mother may have come to terms with this competitive intensity, but much of the computer world has not. There are Websites dedicated to reviling him, law firms focused on foiling him and former friends who sputter at the mention of his name. Companies such as Netscape, Oracle and Sun Microsystems publicly make thwarting his "plan for world domination" into a holy crusade.
The criticism is not just that he is successful but that he has tried to leverage, unfairly and perhaps illegally, Microsoft's near monopoly in desktop operating systems in ways that would let him dominate everything from word processing and spreadsheets to Web browsers and content. The company is integrating its Internet Explorer browser and Microsoft Network content into its Windows operating system, a process that will culminate with the "Active Desktop" planned for Windows 97, due out in a few months. Critics see a pattern of Microsoft's playing hardball to make life difficult for competing operating systems and applications: Microsoft Word has been buggy on Macintosh operating systems, users have found it tricky to make Netscape their default browser when going back and forth from Windows to the Microsoft Network, and application developers have complained that they don't get the full specs for new releases of Windows as quickly as Microsoft's own developers do.
"They are trying to use an existing monopoly to retard introduction of new technology," says Gary Reback, the Silicon Valley antitrust lawyer representing Netscape and other Microsoft competitors. The stakes are much higher than whose Web browser wins. Netscape is enhancing its browser to serve as a platform to run applications. "In other words," says Reback, "if Netscape is successful, you won't need Windows or a Microsoft operating system anymore." On the other hand, if Microsoft is allowed to embed its Web browser into its operating system in a manner that maintains its monopoly, Reback warns, "where will it stop? They'll go on to bundle in content, their Microsoft Network, financial transactions, travel services, everything. They have a game plan to monopolize every market they touch."