Courage under fire

As the US Department of Justice (DoJ) was starting to really turn the heat up under Microsoft with a "barrage of illegal, anti- competitive practice" claims - Steve Ballmer was growing defiant. Ballmer, Microsoft's executive vice president of worldwide sales and support and the number two Microsoft executive behind CEO Bill Gates, is adamant that the allegations against his company are unfounded and that Windows 98 will ship to OEMs. Just when news related to the ongoing dispute was beginning to break, Ballmer met with IDG's Don Tennant to chew the fatIDG: What's the worst-case plausible scenario you see coming out of the DoJ's actions?

Ballmer: That I actually do see? At least with respect to Win 98 I expect no change - we will go to market. I don't think there's any way we will be stopped. We're on a path. We're shipping Win 98. That's what we're doing. So in some senses this is not a cataclysmic week. The product group's got to finish its job, and we've got to get the product out the door and that's that.

Does Microsoft have the technical capability to ship Windows 98 without Internet Explorer (IE)?

No. IE has been an integrated part of Windows since Windows 95 first shipped. Yes, it is more integrated in Windows 98 than it is in Windows 95, but it is an integrated piece. What we wound up doing was not taking it out to satisfy the preliminary injunction. We never took IE out, which is what the DoJ asked for. We just hid it. We also gave OEMs an option to hide it. You know what? Not one OEM has ever taken us up on that option.

Looking back, were there any grey areas Microsoft might have overstepped that brought on the antitrust problems you're facing now, or do you contend that there is no legitimacy whatsoever to any of the complaints that have resulted in your run-in with the DoJ?

There's no legitimacy whatsoever in the legal sense to any of the claims of the DoJ in our view. None whatsoever. Now, why have we become such a target, not just for the DoJ, but for our competitors' whining?

Hey, maybe there is a set of things we could have done differently, although it's hard sometimes to even imagine that. We know we've operated under the law - absolutely, positively, 100 per cent categorically.

Occasionally I'll read something about a partner or an OEM being unhappy in one of these deals. That I don't like - then I feel like we could have done something a little better.

Do you have any knowledge of anything that Microsoft has ever done that you would consider anti-competitive?

I don't know what anti-competitive means. If you mean it in a legal context, absolutely, positively, 100 per cent no. We have never done anything that I know about that is anti-competitive in a legal sense. We've done some things to try to beat our competitors - that's what we're here for.

Microsoft and Compaq have a very tight relationship, so from your perspective is Compaq's acquisition of Digital a positive development for Microsoft from the standpoint of Windows NT advancing into the Unix space?

Both companies have been big NT supporters in different ways - Compaq primarily from a hardware perspective; Digital primarily from a services perspective. Having two such enthusiastic NT supporters come together ought to be good in terms of their overall support for NT.

They've got a lot of strategic issues to decide - that company as it merges will be at a strategic juncture.

Does this acquisition accelerate NT's advance over Unix or not?

It should. Because now you get a real muscle company whose basic enterprise play is NT. It's not a Unix play. I mean they sell some Unix. I'm not trying to say Digital doesn't sell some Unix, but the weight in that company is an NT weight.

Do you still see the Macintosh as a strategic platform for Microsoft product development? How do you see that panning out in the future?

Yeah. Apple's still got to be the company that keeps the Mac vibrant. But we make good money selling Macintosh software - we make more money selling Macintosh software than many companies make in total revenue.

We're not talking about $US10 million here, this is a hundreds-of-millions-of-dollars business, and that's a vital piece of the business for us.

Will Apple be resurgent? Will Apple stay flat? Where will Apple go? I think there are a lot of issues still to be resolved. But we're certainly going to do the best job we can on Macintosh software, and we're going to make sure we have a good path forward for the customers we have on the Mac.

Clearly it's in Microsoft's best interests for Apple to do well. That being the case, who would you like to see as the CEO of Apple?

I don't have a position on that.

You know I can't accept that.

Somebody talented. Steve Jobs would be a great CEO for Apple. He would. He is, and he could continue to be if he wants to. If he wants to do it, he should do it. He would be good at it if his heart's in it.

If Gates was to decide to retire early and asked you to take over as CEO, would you do it?

I wouldn't retire, so I guess I would. But I'd turn on all of my salesmanship to get Bill to stay. I don't think there's any chance Bill's going to do that. Bill and I, I think it is quite likely we will work together as long as we both work.

There will probably be a day when we both don't work - I don't think that day's coming anytime soon, but when that day comes, I suspect both of us wouldn't be working. I don't think there'd be a big time lag between the time I left and Bill left, or vice versa.