FB

Bill Gates 2.0? Keep dreaming, Mr. Zuckerberg

January 8, 2014: 12:49 PM ET

Zuckerberg practices the realpolitik, while Gates is a die-hard ideologue.

By Kevin Kelleher, contributor

140108123705-bill-gates-mark-zuckerberg-620xa

FORTUNE -- If you came of age after Microsoft (MSFT) dominated the technology industry, you might well look at Bill Gates' philanthropic efforrs and call him a hero. Others who had to compete against the de facto monopoly that was Microsoft under Bill Gates might see things differently. To them, he was a vampiric force that fed on the lifeblood of software innovation.

Then there are people who nostalgically call Gates a hero, not for what he's doing today, but for what he did back at Microsoft. Or at least there's one: Mark Zuckerberg.

In September, Zuckerberg said at a conference that Gates was his hero when he was growing up. When his interviewer, Michael Arrington, compared Gates to Darth Vader, Zuckerberg disagreed, saying Gates is "one of the greatest visionaries that our industry has ever had."

Which raises the question: Now that Gates has moved on from the tech industry, can Zuckerberg become to our era what Gates was in his? Is Facebook (FB) the new Microsoft?

Let's compare them. Both of their companies were the first to build a large scale of users in an emerging tech industry. Both are headstrong visionaries who convey a sometimes bashful, intermittently garrulous public image yet who can be cold-blooded in business. Both, famously, are Harvard dropouts. And both see business success not in terms of how good a product or service is, but in how widely it can be disseminated.

MORE: Mulally is staying: Another boost for Ford

As Zuckerberg explained back in September: "Bill Gates ran one of the most mission-driven companies I can think of. Microsoft had a great mission. To put a computer on every desktop and in every home." Microsoft's ability to bring concrete change in the world was inspiring Zuckerberg, he said. And Zuckerberg's company has brought just as much change, if not more so.

But there are important differences too. Facebook and Microsoft came to dominate their industries in different ways. The software industry Microsoft dominated was different from the social web. Every user had to pay for an operating software that was installed computer by computer and that was costly to upgrade. Facebook's extensive code exists largely in the cloud and is free to use.

Microsoft viewed the software industry as a zero-sum game, where a sale to competitors was a loss to Microsoft. Facebook has repeatedly said the Internet isn't a zero-sum game. Consequently, Microsoft focused on controlling the distribution of PC software. Facebook focuses on capturing its users' attention so it can draw in more ad dollars.

It's much harder for a company to come close to monopolizing a technology industry in the age of the Internet, where open-source software and globally distributed networks make it easy for rivals to come at you. And yet, in some ways, Zuckerberg has built Facebook to look like what Microsoft might have become if it had nailed the Internet early on.

Styles of dominance are different. Both companies blatantly copied successful features of others, but Microsoft would copy from partners, even if it meant putting them out of business. Facebook, in the age of the acqi-hire, used threats of copying as a cudgel to drive rivals into acquisition. So Gates at Microsoft was hated, while Zuckerberg really isn't. (Some don't want to work with Zuckerberg, however, as Twitter (TWTR) and Snapchat both rebuffed generous offers from Facebook.)

That may be because Gates didn't care whether anyone liked him or not. His brand of world domination is content to inspire fear, if not respect. By comparison, Zuckerberg's attempt to win the world feels more wishy-washy. He likes to talk publicly about how reluctant he was to generate revenue at Facebook (any such claim from the CEO of a public company is as credible as a shark swearing to a vegan diet). Or how, back at Harvard, he and his roommates used to have long, idealistic talks about how the Internet could add transparency to the world.

Maybe, but the early iterations of Facebook at Harvard suggest otherwise. There's the infamous Facemash, as well as an earlier site he created to entice students to share insights on a course he failed to attend. Both were primitive social networks that crudely exploited the contributions of their users – a template that would play out again and again in Facebook's privacy policies.

So here's one difference between the hero and his follower: Bill Gates might plant a knife and watch you suffer. Mark Zuckerberg would make a thousand paper cuts and pretend you imagined them all.

Both of these approaches can help build a technology colossus, and yet neither will be beloved by consumers. But something interesting happens when these two approaches are translated to the world of philanthropy. There is a familiar ruthlessness that Bill Gates has brought to the application of his wealth to solving problems that have historically proven tough to solve. And, so far, there is a practicality to Zuckerberg's donations that have a self-serving feel to them.

More: Marissa Mayer at CES: Will her vision kickstart Yahoo's growth?

When it comes to giving money, both Gates and Zuckerberg have been, in their ways, both generous and (to borrow Zuckerberg's term) "mission-driven." The Gates Foundation has $40 billion in assets, and its work has taken the edge off a lot of bitter resentment Gates built up at Microsoft, if not silenced them completely.

Zuckerberg has moved aggressively into philanthropy much earlier in his career. He was one of the first to pledge to give the bulk of one's wealth to charity, a gesture prompting others to follow. He pledged $100 million to New Jersey public schools in 2012 and nearly a billion dollars worth of Facebook shares to a Silicon Valley non-profit last year. He's also worked with Gates to teach coding and improve broadband in schools.

So Gates and Zuckerberg are giving billions to charities in a period where such donations are sorely needed. They both deserve praise. Within the world of philanthropy -- itself a tight economy competing for scarce resources -- there has long been a debate over how to allocate resources efficiently. And it's here that a distinction again emerges between young Zuckerberg and old Gates.

Last year, Zuckerberg founded FWD.us, a lobbying group to push immigration and education reform. He claimed he was fighting to bring undocumented workers into the U.S., but never denied some would help make Facebook stronger. Zuckerberg actually said, "I can't really tell anyone how to legislate," even as FWD.us was lobbying for the immigration reform he was publicly seeking. Gates was listed as supporter of FWD.us in name, although he was less vocal about its goals.

Last year, Zuckerberg also began to talk about how important it would be to bring 5 billion people online. Forget that mobile phones and the Internet would connect much of that population in time, with or without Zuckerberg. He wanted a personal stake in that process -- an investment that would make Facebook's ad-clogged news feed a rite of passage into the global middle class.

And that's when the cynical, slick practicality of Mark Zuckerberg ran afoul of the let's-cut-through-this-shit directness of his stated hero. Bill Gates had no issue with Zuckerberg's philanthropy, but when it came to connectivity over his pet projects -- disease, poverty, educating the disenfranchised -- he drew the line.

"As a priority? It's a joke," Gates said to the Financial Times when asked of Zuckerberg's plans to connect the world's population. "Hmm, which is more important, connectivity or malaria vaccine? If you think connectivity is the key thing, that's great. I don't."

And there you have Bill Gates, and there you have his self-appointed acolyte Mark Zuckerberg. Gates is brutally direct. Zuck is insidiously, disingenuously, sugar-coatedly indirect. Gates will push his vision at any cost, even if that cost is extinguishing better technologies, or hacking around rigid social policies.

Zuck, meanwhile, is still stuck in that executive mindset where you act and talk like you're helping the world, but you do it just to further the interests of your company. In 20 or so years, the philanthropy of Mark Zuckerberg may be so great that Bill Gates is just the footnote as the guy who inspired him. Or it could be that he's just another business leader who amassed a great fortune and was forgotten.

The operating software Gates forced into hundreds of millions of homes and businesses may have been inferior in quality to what Zuckerberg enticed a billion-plus lives into. But much of what Zuckerberg won has to do with the fact that, thanks to the Internet, technology has scaled up to more of the world's population. What would Zuckerberg be in the age of Gates? Or Gates (as tech CEO) in the age of Zuckerberg?

Put in political terms, Zuckerberg practices the realpolitik, while Gates is a die-hard ideologue. In the business world, pure practicality can carry you from quarter to quarter, while the ideologues can be the ones who engineer broadening and more lasting change. Zuckerberg's career is just getting started, but it may be Gates who has the bigger impact on the world, not just in business but in the philanthropy both men have pledged themselves to.

  • Four things that could derail Facebook's stock rally

    Facebook's stock price has risen in the past year, but can that continue?

    by Kevin Kelleher, contributor

    FORTUNE – A year ago, few investors were bullish on Facebook (FB). Some writers argued that, at $23 a share, it was still overvalued. Others thought Yahoo (YHOO) under Marissa Mayer had a better shot at a turnaround. While some bears were beginning to temper their pessimism, the consensus view was that Facebook was expensive MORE

    Nov 18, 2013 1:06 PM ET
  • Here comes Mark Zuckerberg's knowledge economy

    It's Mark Zuckerberg's knowledge economy now. And the rest of us just share information inside it.

    By Kevin Kelleher, contributor

    FORTUNE -- It's Mark Zuckerberg's knowledge economy now. And the rest of us just share information inside it.

    Or at least, that is how it appears to Mark Zuckerberg. Ever since Facebook (FB) blew away its earnings three months ago, the company's CEO has been peppering conference calls with the term. This month, MORE

    Nov 5, 2013 10:45 AM ET
  • How the stock market learned to love the web again

    Are we on the precipice of another bubble? Not necessarily, but that doesn't mean there aren't issues with tech stock prices.

    By Kevin Kelleher, contributor

    FORTUNE -- 2013 is proving to be the year that the stock market fell back in love with the Internet. The question is whether the love affair this time will be an enduring one or just another bout of exuberant infatuation.

    For years after the dot-com crash of MORE

    Oct 7, 2013 11:22 AM ET
  • The tech IPO drought is only going to get worse

    Silicon Valley has fallen out of love with the initial public offering.

    By Kevin Kelleher, contributor

    FORTUNE – Last week, Silver Spring Networks went public on the New York Stock Exchange, an event notable not merely for being the stock market debut of a clean-tech star, but also because it was only the second technology IPO of the year.

    Silver Spring (SSNI) raised $81 million in an offering priced at $17 a share. Its stock is MORE

    Mar 19, 2013 6:52 AM ET
  • Facebook vs. Google: It's on! (Again)

    Facebook's IPO woes have taken the spotlight off its rivalry with search giant Google. That's changing. Here's why.

    By Kevin Kelleher, contributor

    FORTUNE -- 2011 was a good year for Facebook. The social network was adding 100 million users every few months. It was on track for an IPO valued as high as $100 billion -- despite a dispirited stock market. And, perhaps most impressively, it had its archrival Google on the run.

    Facebook MORE

    - Sep 24, 2012 7:02 AM ET
  • Facebook: The worst may be over

    Yes, the stock price is still down, but it has staged an impressive rally. Here's why it could continue to climb.

    By Kevin Kelleher, contributor

    FORTUNE -- Is the worst of the Facebook sell-off over?

    Two weeks ago, Facebook (FB) shares -- offered in May at $38 a share -- slipped as low as $25.52, a mere two bits away from fulfilling the price targets of $25 a share that some of MORE

    Jun 21, 2012 11:27 AM ET
  • Facebook's fate: Bulls versus bears

    Is Facebook entering a painful period of decline? Or, will it surge beyond its struggles? Here is the case for both.

    By Kevin Kelleher, contributor

    FORTUNE – It's been more than two weeks since Facebook went public, and it's getting harder to blame the 30% drop in its market value on the trading glitch that marred its debut. Nothing, not even the many privacy controversies that have plagued Facebook's short history, MORE

    Jun 5, 2012 7:50 AM ET
  • Why LinkedIn fiddles as Facebook burns

    The professional social network was seen as sexless compared to Facebook. Now it just seems safe.

    By Kevin Kelleher, contributor

    FORTUNE -- Amid the anger this week of Facebook investors, the embarrassment of the company's underwriters and the schadenfreude of its detractors, a question has been bugging me: If so many investors are skeptical of Facebook's (FB) overvalued IPO, then why are they still so positive on LinkedIn (LNKD)?

    Like Facebook, LinkedIn MORE

    May 24, 2012 10:28 AM ET
  • The problem with the founder's letter

    Like Google and Groupon, Facebook's letter expressed a defiant idealism that -- eventually -- must confront the realities of business.

    By Kevin Kelleher, contributors

    FORTUNE – For Internet companies going public, the founder's letter is becoming a ritual with a purely symbolic value, a rite of passage into the adulthood of public markets. Larry Page and Sergey Brin started it when Google (GOOG) went public in 2004. Andrew Mason raised it to MORE

    Feb 3, 2012 12:16 PM ET
Current Issue
  • Give the gift of Fortune
  • Get the Fortune app
  • Subscribe
Powered by WordPress.com VIP.