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Bill & Steve Act More Friend Than Foe

For the first time since 1983, Microsoft co-founder Bill Gates and Apple co-founder Steve Jobs were together on the same stage at the same time.

Some people expected fireworks at this historic meeting of the arch rivals, which took place Wednesday night at the Wall Street Journal's All Things Digital Conference in Carlsbad, California. It was more of a love fest.

Although there were no arguments between the two men, there was an awkward moment when Jobs was asked about Apple's amusing "I'm a Mac, I'm a PC" commercials. Jobs said the "PC Guy is great" and that the "commercials are not meant to be mean. It's for the guys to like each other. The PC guy is what makes it all work."

Gates just scratched his head with an incredulous look on his face.

Responding to questions from conference co-hosts Walter Mossberg and Kara Swisher, the two tech pioneers showed they have more in common than many people might have thought. And, like the Mac and PC characters in those Apple (Quote) commercials, the two displayed a certain amount of affection during their appearance.

In addition to being competitors, Gates and Jobs have collaborated since the early days of both their companies and continue to collaborate on making Microsoft Office one of the most popular applications for the Macintosh. Microsoft (Quote) was involved in the early development of the Mac where its Excel spreadsheet first appeared along with the first GUI-based (define) version of Word. Years earlier, Microsoft provided a version of its BASIC programming language, the software that launched Microsoft, for the Apple II.

Both men acknowledged working together on the Mac was a big risk. Gates: "We really bet our future on the Macintosh being successful. So we were working together." It was the Mac where Microsoft first introduced software that took advantage of a graphical user interface. Later, Microsoft introduced Office for Windows after it had proved itself on the Macintosh platform.

Much later the two men had the opportunity to work together again. In 1985 Steve Jobs was fired from Apple by then president John Sculley, whom Jobs had recruited. Apple fell into disarray during the 1990s with uninspired products and no apparent direction. Gates recalled that in 1997 he was in discussions with then Apple President Gil Amelio "to get things moving."

But "then one day, Steve called me and said, 'Don't worry about those Amelio negotiations anymore.'" That was when Jobs re-took control of Appleł returning as CEO after Apple bought NeXT, a company that Jobs founded shortly after leaving Apple.

Later that year Microsoft announced that it would make a financial investment in Apple and beef up its Macintosh Office products. Jobs would later say "the developer relationship between Microsoft and Apple is one of the best we have."

Both leaders acknowledged that they are both in the software business. For Microsoft that's obvious but Jobs also considers Apple to be a software company even though it's best known for hardware products. He characterized both the Mac and the iPod as "beautiful software wrapped in a beautiful box."

Both acknowledged one difference between the companies in that Apple makes both the operating system and software for its computers while Microsoft licenses its operating system to PC hardware vendors. Said Jobs, "In the consumer market one can make a pretty strong case that outside of Windows on the PC it's hard to see examples of hardware and software being uncoupled working well."

Gates acknowledged that "in some product categories such as music players it makes more sense to integrate hardware and software." Perhaps copying Apple's success with the iPod, Microsoft makes its own Zune music players and makes both the software and hardware for the popular Xbox game console.

Both Jobs and Gates believe that personal computers will continue to play an important role, even as more and more services migrate to the Internet. As Jobs put it, "The PC has proved to be very resilient" and will continue to be the "hub of your digital life." Gates predicted that the PC will continue to evolve, especially in terms of how we interact with computers, pointing out that touch screens, speech input and "vision input" will become important over the next few years.

Earlier in the day Microsoft, introduced a new "Surface" PC with a 30-inch touch-screen about the size of a coffee table. The company will release it later this year for use in hotels, casinos and other businesses.

Personally, having covered both Apple and Microsoft for the past 25 years, the evening felt like a family reunion. I felt as if I were watching two senior relatives reminisce about the good times they had in their youth.

At one point both were asked if there were any qualities in the other person that they wished they had. Gates said "I'd give a lot to have Steve's taste for both for people and products. I'd see Steve make decisions based on a sense of people and product. The way he does thing is different. It's magic."

Jobs said that he admired Gates' ability to create and maintain partnerships. "Because Woz [Apple co-founder Steve Wozniak] and I started the company doing the whole banana, we weren't so good at partnering with people. In fact, Microsoft was one of the few companies that we could partner with. Microsoft was very good at partnering. If Apple had that in its DNA it would have worked really well but Apple didn't have that until a few decades later." Jobs also gave Gates a great deal of credit for "building the first software company" and being able "to stay with it all these years."

In a rather poignant comment that got "aahs" from the crowd, Jobs summed up his relationship with Gates by quoting a line from a Beatles song. "You and I have memories, longer than the road that stretches out ahead."

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