John Paczkowski

Recent Posts by John Paczkowski

Bill Gates and Steve Jobs

Bill Gates and Steve Jobs

To create a new standard, it takes something that’s not just a little bit different, it takes something that’s really new and really captures people’s imagination and the Macintosh, of all the machines I’ve ever seen, is the only one that meets that standard.”

Microsoft founder Bill Gates, 1984

If I were running Apple, I would milk the Macintosh for all it’s worth–and get busy on the next great thing. The PC wars are over. Done. Microsoft won a long time ago.”

–Steve Jobs, 1996

Soon the great Silicon Valley soap opera will come full circle. Not since Apple CEO Steve Jobs famously interviewed Microsoft Chairman Bill Gates as a possible suitor during the “Macintosh Dating Game” back in 1983 have the two men appeared in a joint bill. And in a few moments, the two will share a stage again for the first time in more than 20 years for what promises to be a historic discussion. Live coverage to follow …

Gates and Jobs

[Note: The liveblog below has been updated with content from our transcript of the conversation]

7:15 p.m PDT: Tonight’s conversation is prefaced by a short film of previous Gates/Jobs appearances. First up: The Macintosh Dating game, circa 1983. [Ah, they looked so much younger then...] And finally Gates and Jobs joking together at D in 2005.

7:20 p.m.: Gates and Jobs onstage.

Walt recognizes the other two bachelors from the “Macintosh Dating Game”: Mitch Kapor and Fred Gibbons, who are both in the audience.

Walt: “Before we get started, there were some pioneers–of 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. And Fred Gibbons, who has not come to D before, but is here tonight.”

Kara: So let’s get started. I wanted to ask, there’s been a lot of mano-a-mano/catfight kind of thing in a lot of the blogs and the press and stuff like that, and we wanted to–the 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: That’s what I see. I mean, a lot of other things you could say, but that’s the high order bit. And I think building a company’s 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 Bill’s 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: I’m not Fake Steve Jobs. [Peals of laughter.]

What Steve’s 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 uniquely–there 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 hadn’t done that well, and some people were saying that general approach wasn’t good, but the team that Steve built even within the company to pursue that, even some days it felt a little ahead of its time–I don’t know if you remember that Twiggy disk drive and…

Steve: One hundred twenty-eight K.

7:35 p.m.:Walt notes that the Mac 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 don’t 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. … 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 don’t think well.

Walt: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 companies–actually, about 24–that 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 where–and I mostly worked with Woz on that.

[Steve interrupts Bill - like an old married couple, these two] “Let me tell this 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 BASIC’s ever done. You don’t have to run it to find your error messages. It finds them when you type it in and stuff. It’s perfect in every way, except for one thing, which is it’s just fixed-point, right? It’s not floating-point.

So we’re getting a lot of input that people want this BASIC to be floating-point. And, like, we’re begging Woz, please, please make this floating point.

[Great moment here, seeing Jobs so animated about something so, let's face it, geeky. Jobs, in a sense, almost trades places with Gates here.]

Walt: Who’s we? How many people are in Apple?

Steve: Well, me. We’re 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 didn’t have an assembler or anything to write it with. It was all just written on paper and he’d 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 don’t know, but he never did.

Walt: Microsoft, if I remember correctly from what I’ve read, wasn’t Microsoft one of the few companies that were allowed to even have a prototype of the Mac at the time?

Steve: Yeah. What’s interesting, what’s hard to remember now is that Microsoft wasn’t 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. We’d 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. … 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.

Kara: Bill, what did you think would happen after the disasters at Apple and Steve left?

Bill: After the 512K Mac was done, the product line just didn’t evolve as fast–Steve wasn’t there–as it needed to. And we were actually negotiating a deal to invest and make some commitments and things with Gil Amelio. No, seriously. So I was calling him up on the weekend and all this stuff and next thing I knew, Steve called me up and said, don’t 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.”

[Walt notes Jobs's statement in the 1997 video about competition with Microsoft being destructive.]

Steve: If the game was a zero-sum game where if Apple wanted to win, Microsoft had to lose, then Apple was going to lose. But Apple didn’t have to beat Microsoft. It had to remember what Apple was. Microsoft was the biggest software developer around, and Apple was weak. So I called Bill up.

[ Interesting. Steve says the developer relationship between Microsoft and Apple is one of the best Apple has.]

[Ah, the obligatory "I'm a Mac, and I'm a PC" reference.]

Kara: And do you look at yourselves as rivals now? Today as the landscape has evolved–and we’ll talk about the Internet landscape and everything else and other companies that have [gone] forward, but how do you look at yourselves in this landscape today? … You watch the commercials, right?

Steve: The art of those commercials is not to be mean, but it’s actually for the guys to like each other. Thanks. PC guy is great. Got a big heart.

[Nice little moment we've got going here. Bill's smiling and rolling his eyes a bit. Clearly has a sense of humor about the whole thing. Then:]

Bill: His mother loves him.

Steve: PC guy’s what makes it all work, actually.

Walt: How often is Apple on your radar screen at Microsoft in a business sense?

Bill: Well, they’re on the radar screen as an opportunity. In a few cases like the Zune, if you go over to that group, they think of Apple as a competitor. They love the fact that Apple’s created a gigantic market and they’re going to try and come in and contribute something to that. [Love it. Apple trying to "contribute" something to the MS ecosystem]

Steve: And we love them because they’re all customers. [Bahahahaha. Man, Jobs is quick on his feet]

Kara: Steve, how do you look at Microsoft from an Apple perspective?

[Jobs recycles his "Apple is about beautiful software in a beautiful box" comments from the earlier session today.] “The big secret about Apple, of course–not-so-big secret maybe–is that Apple views itself as a software company and there aren’t very many software companies left, and Microsoft is a software company. And so, you know, we look at what they do and we think some of it’s really great, and we think a little bit of it’s competitive and most of it’s not. You know, we don’t have a belief that the Mac is going to take over 80% of the PC market. You know, we’re really happy when our market share goes up a point and we love that and we work real hard at it, but Apple’s fundamentally a software company and there’s not a lot of us left and Microsoft’s one of them.”

Walt:Was there something you might have done differently where you could have had a bigger market share for the Mac. Is there something you regret?

Steve: There’s a lot of things that happened that I’m sure I could have done better when I was at a Apple the first time and a lot of things that happened after I left that I thought were wrong turns, but it doesn’t matter. It really doesn’t matter and you kind of got to let go of that stuff and we are where we are. So we tend to look forward.

And, you know, one of the things I did when I got back to Apple 10 years ago was I gave the museum to Stanford and all the papers and all the old machines and kind of cleared out the cobwebs and said, let’s stop looking backwards here. It’s all about what happens tomorrow. Because you can’t look back and say, well, gosh, you know, I wish I hadn’t have gotten fired, I wish I was there, I wish this, I wish that. It doesn’t matter. And so let’s go invent tomorrow rather than worrying about what happened yesterday.

Kara:How do you look at the landscape at this moment and what’s happening especially in the Internet space?

Steve: I think it’s super healthy right now. I think there’s a lot of young people out there building some great companies who want to build companies, who aren’t just interested in starting something and selling it to one of the big guys, but who want to build companies. And I think there’s some real exciting companies getting built out there. Some next-generation stuff that, you know, some of us play catch-up with and, you know, some of us find ways to partner with and things like that, but there’s a lot of activity out there now, wouldn’t you say?

Bill: Yeah, I’d say it’s a healthy period. The notion of what the new form factors look like, what natural interface can do, the ability to use the cloud, the Internet, to do part of the task in a complementary way to the local experience, there’s a lot of invention that the whole approach of start-ups, the existing companies who do research, we’ll look back at this as one of the great periods of invention.

Walt:You’re the guys who represent the rich client, the personal computer, the, you know, big operating system and all that In five years, is the personal computer still going to be the linchpin of all this stuff?

Bill: Well, you can say that it will be predicted that it won’t be. You know, the network computer took this over about, whatever, five years ago we disappeared. Remember the single-function computer? There was somebody who said that these general purpose things are kind of a dumb idea. … The mainstream is always under attack. The thing that people don’t realize is that you’re going to have rich local functionality, I mean, at least our bet, whereas you get things like speech and vision, as you get more natural form factors, it’s a question of using that local richness together with the richness that’s elsewhere. And as you look at the device, say, that’s connecting to the TV set or connecting in the car, there are lighter-weight hardware Internet connections, but when you come to the full screen rich, you know, edit the document, create things, you know, I think we’re nowhere near where we could be on making that stronger.

Walt:What are the devices you might carry around five years from now?

Bill: I don’t think you’ll have one device. I think you’ll have a full-screen device that you can carry around and you’ll do dramatically more reading off of that.

Kara: Light.

Bill: Yeah. I mean, I believe in the tablet form factor. I think you’ll have voice. I think you’ll have ink. You’ll have some way of having a hardware keyboard and some settings for that. And then you’ll have the device that fits in your pocket, which the whole notion of how much function should you combine in there, you know, there’s navigation computers, there’s media, there’s phone. Technology is letting us put more things in there, but then again, you really want to tune it so people know what they expect. So there’s quite a bit of experimentation in that pocket-size device. But I think those are natural form factors and that we’ll have the evolution of the portable machine. And the evolution of the phone will both be extremely high volume, complementary–that is, if you own one, you’re more likely to own the other.

Steve:It will be the PC maybe used a little more tightly coupled with some back-end Internet services and some things like that. And, of course, PCs are going mobile in an ever greater degree. So I think the PC is going to continue. This general purpose device is going to continue to be with us and morph with us, whether it’s a tablet or a notebook or, you know, a big curved desktop that you have at your house or whatever it might be. So I think that’ll be something that most people have, at least in this society. In others, maybe not, but certainly in this one. But then there’s an explosion that’s starting to happen in what you call post-PC devices, right? You can call the iPod one of them. There’s a lot of things that are not. … I think there’s just a category of devices that aren’t as general purpose, that are really more focused on specific functions, whether they’re phones or iPods or Zunes or what have you. And I think that category of devices is going to continue to be very innovative and we’re going to see lots of them.

Walt: Is the iPhone and some of these other smart phones–and I know you believe that the iPhone is much better than these other smart phones at the moment, but are these things–aren’t they really just computers in a different form factor? I mean, when we use the word phone, it sounds like…

Steve: We’re getting to the point where everything’s a computer in a different form factor. So what, right? So what if it’s built with a computer inside it? It doesn’t matter. It’s, what is it? How do you use it? You know, how does the consumer approach it? And so who cares what’s inside it anymore?

Walt: So what are the core functions of the device formerly known as the cellphone, whatever we want to call it?

Bill: How quickly all these things that have been somewhat specialized, the navigation device, the digital wallet, the phone, the camera, the video camera, how quickly those all come together, it’s hard to chart out. But eventually, you’ll be able to pick something that has the capability to do every one of those things.

And yet, given the small size, you still won’t want to edit your homework or edit a movie on the screen of that size. And so you’ll have something else that lets you do the reading and editing and those things. Now, if we could ever get a screen that would just roll out like a scroll, you know, then you might be able to have the device that did everything.

Kara: Outside the computing area, what are the exciting areas in the Internet space at all that you’re looking at that’s interesting to each of your companies and in general for you? Any social networking, any kind of the Wikis, those kind of things, things we’ve talked about in the past couple–today, essentially?

Steve: You know, we’re working on some things that I can’t talk about … [But they will restore a sense of childlike wonderment to our lives, right?]

Steve: There’s a zillion interesting things going on on the Internet. The most interesting things to me are these incredible new services that people are bringing up … There’s a lot of them surrounding entertainment, but there’s a lot of them that have to do with just sort of figuring how to navigate through life a little more efficiently. And I think, you know, it’s really great when you show somebody something and you don’t have to convince them they have a problem this solves. They know they have a problem, you can show them something, they go, oh, my God, I need this. And I think you’re going to see a lot of things like that happen over the next year or two.

Walt: Bill, you weren’t here, but Steve showed a new function of Apple TV that brings YouTube directly to the TV. Is there going to be more of that from you? Do you see yourself the way Bill says, as an enabler of entertainment or, I mean, putting aside your Disney role, but your Apple role?

Steve: I mean, I think people want to enjoy their entertainment when they want it and how they want it, on the device that they want it on. So ultimately, that’s going to drive the entertainment companies into all sorts of different business models. And that’s a good thing. I mean, if you’re a content company, that’s a great thing. More people wanting to, you know, enjoy your content more often in more different ways, that’s why you’re in business, but the transitions are hard sometimes.

And, you know, the music industry, it turned out that the Internet got fast enough to download songs pretty easily. There was no legal alternative and maybe they made some bad choices in how they reacted to that, but, you know, they’re still trying to make the transition to a very different way of doing business, or ways of doing business while they’re under attack from piracy. And we can all highlight some of the mistakes that have been made, but, you know, still, it’s a tough job.

And Hollywood, I think, you know, has watched what’s happened in music, learned some things to do, some things not to do, but, you know, they’re still trying to map this out. How do they make some of these transitions, some new business models, different platforms, allowing their customers way more freedom on when they want to watch stuff and how they want to watch it. And I think there’s a tremendous amount of experimentation and thought going on that’s going to be good. It’s going to be really good if you’re a content owner.

Walt: In the offing in the next four or five years, is it possible there’s a new paradigm for organizing the user interface of the personal computer?

Bill: One of the things that’s been anticipated for a long time is when 3D comes into that interface. And there was a lot of experimentation, sites on the Internet where you’d kind of walk around and meet people, but in fact, the richness, the speed, it just didn’t sustain itself. Now we’re starting to see with some of the mapping stuff, a few of the sites, that the quality of that graphics, the tools and things, are getting to the point where 3D can really come in. So I’d definitely say that when you go to a store, bookstore, you’ll be able to see the books lined up, you know, the way you might be interested in or lined up the way they are in the real store.

So 3D is a way of organizing things, particularly as we’re getting much more media information on the computer, a lot more choices, a lot more navigation than we’ve ever had before. And we can take that into this communications world where the PC is playing a much more central role, kind of taking over what was the PBX, sort of one of the last mainframes in the business environment. That will be a big change that will come to it. And as we get natural input, that will cause a change. … Software is doing vision and so, you know, imagine a game machine where you’re just going to pick up the bat and swing it or the tennis racket and swing it.

Walt: We have one of those.

Kara: Yeah. Wii.

Bill: No, that’s not it. You can’t pick up your tennis racket. And swing it.

Bill: You can’t sit there with your friends and do those natural things. That’s a 3D positional device. This is video recognition.

Kara: Steve? I know you’re working on something, it’s going to be beautiful, we’ll see it soon.

Walt: And you can’t talk about it.

Steve: Yeah.

Walt: Bill discusses all his secret plans. You don’t discuss any.

Steve: I know, it’s not fair. But I think the question is a very simple one, which is how much of the really revolutionary things people are going to do in the next five years are done on the PCs or how much of it is really focused on the post-PC devices. And there’s a real temptation to focus it on the post-PC devices because it’s a clean slate and because they’re more focused devices and because, you know, they don’t have the legacy of these zillions of apps that have to run in zillions of markets.

And so I think there’s going to be tremendous revolution, you know, in the experiences of the post-PC devices. Now, the question is how much to do in the PCs. And I think I’m sure Microsoft is–we’re working on some really cool stuff, but some of it has to be tempered a little bit because you do have, you know, these tens of millions, in our case, or hundreds of millions in Bill’s case, users that are familiar with something that, you know, they don’t want a car with six wheels. They like the car with four wheels. They don’t want to drive with a joystick. They like the steering wheel.

And so, you know, you have to, as Bill was saying, in some cases, you have to augment what exists there and in some cases, you can replace things. But I think the radical rethinking of things is going to happen in a lot of these post-PC devices.

Kara:What’s the greatest misunderstanding in your relationship?

Steve: We’ve kept our marriage secret for over a decade now. [Rimshot! Laughter and applause.]

Kara: Canada. That trip to Canada. [Audience still roaring. More laughter and applause]

Bill: It’s been fun to work together. I actually kind of miss some of the people who aren’t around anymore. You know, people come and go in this industry. It’s nice when somebody sticks around and they have some context of all the things that have worked and not worked. The industry gets all crazy about some new thing, you know, like, there’s always this paradigm of the company that’s successful is going to go away and stuff like that. It’s nice to have people seeing the waves and waves of that and yet, when it counted, to take the risk to bring in something new.

Steve:You know, when Bill and I first met each other and worked together in the early days, generally, we were both the youngest guys in the room, right? Individually or together. I’m about six months older than he is, but roughly the same age. And now when we’re working at our respective companies, I don’t know about you, but I’m the oldest guy in the room most of the time. And that’s why I love being here. … And, you know, I think of most things in life as either a Bob Dylan or a Beatles song, but there’s that one line in that one Beatles song, “you and I have memories longer than the road that stretches out ahead.” And that’s clearly true here.

[That may come across as cheesy here in print, but honestly it wasn't. It was pretty touching. Watch the video and you'll see Jobs emotional and, if only for a very brief moment, vulnerable. ]

And after that tender moment, we’re on to the Q&A …

Question: Hi. I’m Jesse Kornbluth, HeadButler.com. But you’re not the youngest guys in the room anymore, it’s perhaps appropriate to ask you a question about legacy, each of you. Bill, even your harshest critic would have to admit that your philanthropy work is, you know, planet-shaking, incredible, and could be, if you make it, a second act so amazing that it would dwarf what you’ve actually done at Microsoft.

[Applause]

If you had to choose a legacy, what would it be? And Steve, do you look at Bill and you think, gee, that guy is so lucky he had a company so rich with talent that he didn’t have to personally come in every day and save it and, you know, I wish I had the opportunity?

Kara: OK. He’s not going to answer that one.

Walt: Bill?

Bill: Well, the most important work I got a chance to be involved in, no matter what I do, is the personal computer. You know, that’s what I grew up, in my teens, my 20s, my 30s, you know, I even knew not to get married until later because I was so obsessed with it. That’s my life’s work. And it’s lucky for me that some of the skills and resources–but I put skills first–that I was able to develop through those experiences can be applied to the benefit of the people who haven’t had technology, including medicine, working for them. So it’s an incredible blessing to have two things like that. But the thing that I’ll, you know, if you look inside my brain, it’s filled with software and, you know, the magic of software and the belief in software and, you know, that’s not going to change.

Steve: So your question was about whether I wish I didn’t have to go into Apple every day?

Jesse: No, if you envied Bill a bit, this second act that he has.

Steve: Oh, no. I think the world’s…

Kara: You want to do anything else.

Steve: I think the world’s a better place because Bill realized that his goal isn’t to be the richest guy in the cemetery, right? That’s a good thing and so he’s doing a lot of good with the money that he made.

You know, I’m sure Bill was like me in this way. I mean, I grew up fairly middle-class, lower middle-class, and I never really cared much about money. And Apple was so successful early on in life that I was very lucky that I didn’t have to care about money then. And so I’ve been able to focus on work and then later on, my family.

And I sort of look at us as two of the luckiest guys on the planet because we found what we loved to do and we were at the right place at the right time and we’ve gotten to go to work every day with super bright people for 30 years and do what we love doing.

And so it’s hard to be happier than that. You know, your family and that. What more can you ask for? And so I don’t think about legacy much. I just think about being able to get up every day and go in and hang around these great people and hopefully create something that other people will love as much as we do. And if we can do that, that’s great.

More coverage at The Wall Street Journal

Text and video coverage of the complete Steve Jobs and Bill Gates interview:

Bill Gates and Steve Jobs Session Photos

1 of 18  Back  Next

Walt and Kara with Steve Jobs and Bill Gates at D5


Twitter’s Tanking

December 30, 2013 at 6:49 am PT

2013 Was a Good Year for Chromebooks

December 29, 2013 at 2:12 pm PT

BlackBerry Pulls Latest Twitter for BB10 Update

December 29, 2013 at 5:58 am PT

Apple CEO Tim Cook Made $4.25 Million This Year

December 28, 2013 at 12:05 pm PT

Latest Video

View all videos »

Search »

D Conference Mailing List

Sign up for News about D Conferences