Detroit Free Press

DETROIT – Every morning when Bill Gates gets up, he reminds himself of the dream companies he wanted to work for just before he dropped out of Harvard to form Microsoft.

He thinks of pioneering high-tech companies like Digital Equipment Company, Wang and Control Data Corp. that in the early and mid-’70s were seemingly as invincible in their day as Microsoft is today.

The lesson on what happened to those once top companies – all now defunct – has not been lost on Gates.

“If you don’t pay attention, you’re gone,” Gates said in a conversation Wednesday with a handful of reporters after an appearance at the University of Michigan in Ann Arbor.

That explains why Gates, Microsoft’s chairman and chief software architect, has just ordered a restructuring aimed at reducing the number of Microsoft divisions from five to three and why he is on the road this week, visiting six university campuses in North America aimed at sparking a renewed interest in computer science and technology research.

The tour kicked off Wednesday with Gates speaking to about 1,000 high school and college students at Rackham Auditorium. The hourlong talk gave the students a look at how the world’s richest man – casually dressed in a green pullover sweater with a matching open-collared shirt – views the world they will soon venture into.

“He’s pretty cool,” said Amy Stergar, 17, of Troy, Mich., one of 22 students from Marian High School in Bloomfield Hills, Mich., bused to the event. “I think it’s pretty neat that he had all these ideas as a young man and made it happen.”

Afterwards, in his roundtable meeting with reporters, Gates volunteered only a sentence of nostalgia. “It is certainly a dream come true in that we set a computer on every desk in every home and have the level of sales and profitability and employees we have today.”

But, he said, “we don’t look back a lot.”

Maybe that’s because what’s now breathing down Microsoft’s large corporate neck is the breath of a newer, more nimble tech giant called Google, which in recent weeks has reached far and beyond its search site origins.

Google has announced its intent to set up wireless Internet networks, provide voice communications applications and to leverage its dominant place on computer desktops to rival Microsoft for control of the user’s experience when online.

It’s all part of what many believe is a growing move by Google to change the way we use computers, away from storing information and programs on computer hard drives and instead using the Internet as a place to keep and retrieve data and applications that can be accessed from anywhere and on any device regardless of operating system.

Last week, in its most aggressive move to date, Google announced a new partnership with longtime Microsoft arch-rival Sun Microsystems to develop and improve in some still unspecified way a free Sun tool called OpenOffice, a block of programs that is similar in function but with fewer features than Microsoft’s hugely profitable Office software like Word, Excel and Powerpoint.

Gates seemed a tad touchy on the subject.

“It was a very vacuous announcement,” he huffed when asked about the new Sun-Google alignment. “If you figure it out more than that let me know. OpenOffice has been around for a long time. So, what’s new? … In that particular area, we’ve invested way more than other people.”

Gates said the next release of Office, version 12, will be sometime in the second half of 2006, and “is the most exciting version we’ve ever done.” About the same time, he said, the next update of Windows, called Vista, will also become available.

While Gates acknowledged that Google still has the best Internet search engine, he said “most of the other things they have done (are) nowhere near as good as what we or others have done.”

Over the next year Gates expects “we’ll have a better search engine and make it more attractive for people to use.”

The strength in Microsoft, he said, is variety and constant innovation.

“If you look at Microsoft, about half the things we do all by ourselves … and we have no competitors,” he said. The other half of the things we do we succeed in by being supergood competitors. It’s great to have that mix.”

In the interview, Gates conceded that he’s not immune from feeling the pressure.

“You wake up each day and say, wow, Google’s doing a good job on this and Sony’s doing a good job on that,” he says. “You want to be forward-looking and always basically fearful. You better prove yourself every time.”

That’s because he remembers what happened to those once booming tech companies that were the epitome of success during his early days.

So, he says, he’s still making “big bets” in new technology he’s convinced will revolutionize the world. As proof, he said Microsoft keeps hiring, about 1,000 people every year.

Specifically, he touted the slow-selling Microsoft Tablet PC, which lets people use handwriting on the screen to take notes and enter data much as they would with a paper pad. “Most people still don’t think the tablet will pay off but I’m staking my reputation on it in a very big way.”

He also had strong praise for the new Microsoft xBox 360 video game, which goes on sale next month.

Microsoft, once the tech world’s hottest and hippest company, is celebrating its 30-year anniversary this year.

“Right now, for a variety of reasons, we’re being underestimated,” he said. Ironically, about the same time Gates said those words, Apple Computer, the current darling of the tech world thanks to its hugely popular music-playing iPod, was announcing a new model that will also play video.

But don’t think he’s lost his momentum. “As (Microsoft’s new) products roll out and people see the impact, (there will be) a self-correcting reality,” he predicted.