By: MARK FITZGERALD
WHEN MICROSOFT CHAIRMAN Bill Gates spoke to the Newspaper Association of America April 29, he spoke softly, but many publishers kept looking for the big stick.
Gates repeatedly praised newspapers as potentially strong players on the Internet. Just as often he characterized the behemoth Microsoft as a company that will “forever” get its revenue from selling software ? and not classified advertising.
When Microsoft starts up a cable news channel or an online city guide or a Web magazine of political opinion, it’s only to learn more about its real business: Developing software.
“Don’t think of Microsoft as a primary competitor here,” Gates said. “We’re not doing local news. We’re not doing classified. We’re seeing where this technology can go.”
Newspapers are positioned to be strong Internet competitors, Gates argued, so they shouldn’t worry when Microsoft occasionally “blurs the line” between software vendor and content provider.
“In terms of local content, newspapers will be in the forefront,” Gates said. “You shouldn’t get overly paranoid and think a broad competitor is coming after your local franchise.”
Gates minimized the threat of the new Sidewalk online arts and entertainment service that has already been rolled out in Seattle and is on the way to other cities. “It’s more of a competitor to a weekly entertainment guide than to a daily newspaper,” he said.
Newspapers should worry only if Microsoft or another Web company begins hiring local reporters, he said. That was a bit much for Bob Ingle, Knight-Ridder’s vice president of new media.
“I do cop to being paranoid,” Ingle told Gates. “You talk about how we shouldn’t worry until we see companies going out and hiring local reporters. Well, as far as I’m concerned, at Sidewalk that’s exactly what you’re doing.”
Gates responded that he wasn’t hiring reporters, and even though there was some “overlap” with the traditional newspaper franchise, Sidewalk would be used by people who simply prefer to get information on the Web rather than from a paper.
“Part of this crowd may be gullible enough to buy that, but I do not,” Ingle said later.
Judging by their comments, other publishers were equally skeptical.
Detroit Free Press publisher Heath Meriwether, for instance, summed up Gates’ NAA talk this way: “Disingenuous.com.”
One executive who insisted on anonymity was even more blunt: “Microsoft is sort of the master of the Big Lie. . . and it starts with him.”
New NAA chairman David Cox, the president and chief executive officer of Cowles Media Co., put it a little more diplomatically: “He was clearly extending a hand of friendship and trying to partner with newspapers,” Cox said. “It’s still a fact that for whatever reason, Microsoft has chosen to enter areas that are competitive with newspapers, and it is important for us to be cautious. If his offer turns out to be sincere, well, maybe there are areas where we can be partners. But it is important to be cautious in the event that that is not their aim.”
Cox also saw Gates’ soft-spoken approach as a concession by Microsoft that the local news and information business is a little tougher than expected. Some industry figures were a little more impressed with Gates’ argument that competition need not prevent cooperation.
“I come from a business in which everybody competes with everybody and everybody cooperates with each other,” Gates said.
He cited as a model of Microsoft/newspaper cooperation Philly Online, the Web service of Knight-Ridder’s Philadelphia papers. It uses Microsoft servers and network operating systems.
Newspapers are in a very strong position in Internet business, Gates said, reasoning that online users want depth, high-quality content, and want to get information from people disciplined in publishing under time constraints.
Unlike Ted Turner ? who boasted at a publishers meeting about 15 years ago that newspapers would be essentially dead in five years ? Gates clearly wanted to give the impression he was in Chicago to praise newspapers not bury them.
Asked, for instance, what he thought newspapers will look like a decade from now, he said, “I doubt the print newspaper will look dramatically different in ten years. You’ll probably treasure the fact that you’ll have the electronic mail addresses of a substantial part of your subscribers.
?(“Don’t think of Microsoft as a primary competitor here. We’re not doing local news. We’re not doing classified. We’re seeing where this
technology can go” ) [Caption]
?(? Bill Gates, chairman, Microsoft) [ Photo & Caption]
?Web Site: http://www.mediainfo.com.
?copyright: Editor & Publisher, May 3, 1997.