Gates Gets It Wrong Again on Windows Mobile (Premium)

In an interview on CNBC, Microsoft co-founder Bill Gates, in the midst of a career rehabilitation effort, reiterated his earlier—and horribly incorrect—claim that his biggest mistake was not establishing Microsoft’s mobile platform as the dominant challenger to the iPhone.

“There’s no doubt that the antitrust lawsuit was bad for Microsoft,” Gates said in the interview, suddenly lurching out of his slouch and gesticulating. “And we would have been more focused on creating the phone operating system. So instead of using Android today, you would be using Windows Mobile.”

I’ll pause for a moment while you try to get past that horrible outcome: The Windows Mobile that Gates describes is not the version that crashed and burned with Microsoft’s Windows phone platform, but is rather than pre-iPhone system that was proven to be inept and behind the times when Apple’s device did arrive in 2007.

“If it hadn’t been for the antitrust case, Microsoft would have …. We were so close! We … we… I was just too distracted,” he continues. “I screwed that up. Because of the distraction. And we were just three months too late with the release [that] Motorola would have used on, you know, a phone … So … yes. It’s a winner take all game, that is for sure.”

I assume the Motorola phone that Gates alludes to is the original Droid, which shipped on Verizon—which at the time did not have access to the iPhone and wanted something competitive. That phone shipped in October 2009, so he might also be alluding to Windows Phone 7, which was announced in February 2010 and shipped in new phones in October 2010, a year later.

“Now, nobody here has ever heard of Windows Mobile,” he continues. “But oh well. And … [what’s] a few billion here or there?”

Those comments drew laughter. But this next bit is perhaps more interesting.

“I wouldn’t have retired as soon and … I am disappointed that Windows Mobile didn’t succeed,” he says. “But in terms of my own life, you know, even though it was a very painful thing, because I got very personally involved in the defense of the company [in the U.S. antitrust case], the fact that I retired earlier probably net was good for me because I got down the learning curve on the [Bill & Melinda Gates] Foundation.”

Sorry, Bill. But the math doesn’t add up.

Gates was the CEO of Microsoft until January 2000. The U.S. antitrust case was already over by that point and after four months of settlement talks, the firm was finally found guilty of antitrust abuse in April 2000. Gates was at that time Microsoft’s Chairman and Chief Software Architect, and he transitioned to a part-time role in 2006. He formally stepped down as Chairman in February 2014 and currently advises today’s Microsoft CEO, Satya Nadella, on what we can assume is a very limited basis.

Windows Mobile had its roots in Windows CE and its successors, and Microsoft released Windows Mobile 6.0, a woeful product, in early 2007, just ahead of the iPhone. It was followed up by Windows Mobile 6.1 over a year later, and that product included some iPhone-inspired surface-level UIs on top of the rest of the aging platform. Microsoft eventually decided to start over with Windows Phone 7, which, again, wasn’t announced until 2010. By then, of course, it was too late: Android and the iPhone had established ecosystems and momentum, and Windows Phone never stood a chance.

“I don’t have a life where I’m allowed to complain,” Gates continues, “because basically only 99.99 percent of things have worked out really well [for me].”

That’s cute. But had Microsoft succeeded in mobile, it would have been a bigger product for the company than Windows, the PC-based system which Microsoft and Gates rode to success and market dominance.

I do believe that Microsoft was distracted by the antitrust trial—and by related EU-based antitrust issues—and that the firm’s “lost decade” did lead to the rise of Amazon, Apple, Facebook, of Google. But the problem with Windows Mobile wasn’t distraction: It was that an established monopolist was never going to innovate in mobile when coasting on its past successes was both necessary and unavoidable.

Put another way, the real issue that Microsoft faced was Apple, not Google and Android. And that Microsoft, like so many other companies—including those like Nokia and RIM that were actually dominant in mobile at the time—didn’t respond correctly or quickly enough to the iPhone threat. Only Google did. But that’s a cultural problem. And it’s one that a non-distracted Gates and Microsoft would not have overcome regardless.