Microsoft's Chairman and CEO, William H. Gates, demonstrated what one might consider a rare instance of humility during his interview with Herring editorial advisor Alex Serge Vieux, this month in Madrid. [See Interview] One of the questions hurled at Mr. Gates concerned when he thought such advances as speech-input interfaces to PCs would become broadly available. His answer: "If you had asked me this five years ago, I would have said that speech input, pen computing, and PDAs would have all been popular by now, so I have almost a perfect record of being over-optimistic when it comes to predicting when new technologies will catch on."

In yet another gesture of humility, Mr. Gates presented his new-and-improved vision of the Microsoft Network, which he now describes as a "branded publishing community on the Internet." This evolution in strategy signifies Mr. Gates' realization that the Internet is the network, and that his original hope of building a private network, а la AOL, CompuServe, Prodigy, et al, which Microsoft could completely control, has been abandoned. The Herring thinks this is a smart move.

That being said, if Microsoft is serious about playing a dominant role in the Internet market, it still has huge technological hurdles to jump, and a whole pack of fast-footed startups nipping at its heels. First, Microsoft has to recognize that Netscape, with its highly integrated 2.0 browser due out soon, its growing family of Internet server software solutions, and its 10 million customers, is galloping well ahead in the race to establish a broadly accepted network platform -- that is, the software foundation that will allow Internet users and publishers to operate on the Net at a level above operating systems such as Windows, the Mac OS, or UNIX. We all have to accept that a new line has been drawn in the sand, and that Microsoft's long-time vision of a Windows-only computer world is being challenged.

Another factor certain to shake up Microsoft is the opportunity for small software companies to cheaply advertise and distribute their wares over the Net. This low-cost distribution channel will eventually undermine the advantages traditionally afforded software powerhouses with firmly entrenched retail and business-to-business distribution channels. Jim Clark cites two examples of the potential of the Internet to provide quick and easy ways for small companies to build their customer bases, in his interview with The Herring this month. The first is his own experience with Netscape. "We were able to use the Internet to build a customer base of 10 million users in just about nine months. Our only expense was the engineering cost of making the program," Mr. Clark boasts. His other example is a software company he recently visited that has developed a Windows-compatible suite that competes with Microsoft Office. It plans to distribute this package for $39 over the Net, versus the $400 Microsoft currently charges. Though this company's success is not assured, it will certainly be interesting to see if a small company can use this strategy to attack the core businesses of giants such as Microsoft.

Mr. Clark's comments in this issue lift the curtain on Netscape's ambitious strategy. Mr. Gates' thoughts are not quite so clear. He talks about making Windows the best client software for the Net by building in browsing capability. He also refers to efforts underway in Microsoft's Word group, which "has been charged with making Word an excellent way to author and read online content." And Mr. Gates assures us that Microsoft "realizes that the future of the company rests, in part, on how well we can adapt to a competitive environment changed by the Internet." But if Microsoft wants to compete with Netscape and the other companies broadening the capabilities of the Net, it will have to deliver -- ASAP -- a competitive network platform that is hardware and operating system independent. More recently, Microsoft has made vague references to its Blackbird project, which is presumably brewing up software to head in this direction, but we will just have to wait and see.

It's interesting to note that Microsoft is the only major computer company that Netscape hasn't cut a deal with. It's clear that Mr. Clark knows whom his biggest competitor is. "Microsoft is always going to be a threat to everybody," admits Mr. Clark. Apparently Mr. Gates agrees. In a recent article in Fortune, he says that the Internet is germinal to the next phase in the computer revolution, as the PC was in Microsoft's youth, and that in the computer industry one company has never led two successive eras. "The odds are against us, and that's what makes it so much fun," he chimes. So there you have it -- another breakthrough technology swooping in and rewriting the rules of business, just when everyone seemed to be getting comfortable. We suppose that's what keeps technology and entertainment entrepreneurs gulping their espressos at the beginning of each day, and gives The Herring provocative topics to write about each month.

BY GEORGE!

Or perhaps the headline should read Buy George!, because that's what I'm doing. George is, of course, the spankin' new lifestyle magazine founded by John Kennedy and his long-time buddy Michael Berman, whose stated mission is to "bring politics to life by covering the points where politics and popular culture converge." And I have to admit, I ventured into the pages of George with great trepidation, presupposing it to be another low-brow, glossy rag out of NYC, edited for limousine liberals and others living two steps beyond the real world. The early publicity surrounding this new pub wasn't conducive to positive expectations, either. All we heard about was how the cover shot was going to expose Cindy Crawford's midriff (how predictable), and we were going to get a dose of political advice from the likes of Madonna and Candace Gingrich -- Newt's out-and-about half-sister. It all sounded like the glorification of what's wrong with politics, not a new perspective with anything of value.

Once I got beyond Ms. Crawford, and the plethora of consumer ads normally reserved for Esquire and Vanity Fair, I found a table of contents filled with stories that actually seemed worth reading. I especially enjoyed the inside story on how liberal black activist DeLores Tucker and conservative watchdog Bill Bennett took on Time Warner over gangsta rap, and separate profiles on how Park Avenue-bred Heather Higgins and unrepentant hippie John Perry Barlow try to blend their forms of conservatism and cyberknowledge into a fast-changing political environment. I even enjoyed Mr. Kennedy's opening remarks, which framed George's raison-d'кtre into recent American political history. "Empowered by technology and emboldened by a desire to take their case directly to the people, politicians broke all the old rules: Clinton played his sax on Arsenio Hall, George Bush appeared on MTV, and Ross Perot shocked us all by announcing his candidacy on Larry King Live." Sure, we all know this, but George is the first publication dedicating itself to this new beat. "As a lifelong spectator of the giant puppet show that can turn people into barely recognizable symbols of themselves, I hope we can provide something more useful," Mr. Kennedy continues. And this, very simply, will be Messrs. Kennedy and Berman's ongoing challenge: to demystify "poli-tainment." While some critics will undoubtedly find George more fluffy than stuffy, and others will be frustrated with its "post-partisan" approach (i.e. observe more, proselytize less), it's worth $9.97 for the first six issues. For the Net surfers in the crowd, George's Web site is http://www.georgemag.com.. I say, give it a try! At worst, George will be one more way to keep an eye on all the politicians we love to hate.