There are not many people in the world qualified to give Mark Zuckerberg advice at a time like this. But perhaps one of them is Bill Gates. Facebook’s boss has a close friendship with the Microsoft founder, who is three decades his senior and one of Zuckerberg’s heroes. His formative computing years, in the 1990s, came when Gates was on top of the world and when Microsoft was not only the world’s most powerful technology company, but also the coolest.
There are a lot of similarities between the two: Both are Harvard dropouts who left to form the companies that would make them among the richest men in the world. And both have pledged to give away almost all of their wealth to charitable causes.
Gates’ position two decades ago is also a lot like that facing Zuckerberg today. More than anybody else, the Microsoft founder was the technology industry personified, the genius computer programmer with a prescience that made him a marvellous businessman. And despite his disarmingly cuddly profile, Gates was ruthlessly competitive, eliminating competitors with little mercy.
Zuckerberg has cultivated the same warm public image, with a public profile that regularly shows off his family man credentials (his Facebook page has as many posts displaying him at home baking or playing with the family dog as it does mea culpas on the company’s recent privacy scandal).
Like Gates was, Zuckerberg is the most recognisable technology entrepreneur of this decade, and is the face of his company in a way that Google and Amazon’s founders are not. This image has somewhat masked Zuckerberg’s calculated manoeuvring: The purchases of potential rivals such as Instagram and WhatsApp and the cloning of Snapchat’s key features, which have so remorselessly neutered perhaps its biggest competitor.
But if Zuckerberg and Facebook’s rise has mirrored that of Gates and Microsoft’s, so might its future. Almost exactly 20 years ago, the United States Department of Justice sued Microsoft for illegally hobbling rivals by using the monopoly enjoyed by Windows to promote its own web browser. Microsoft’s stock continued to enjoy a dotcom bubble rise, but this moment was the point at which its empire began to crumble. Gates was forced to testify in front of US politicians and later give a disastrous videotaped deposition in which he appeared hostile and defensive, introducing the world to a different side of the lovable geek.
The case dragged on for years, and came to define Microsoft. Although the company eventually settled, and got off relatively lightly, only having to make minor changes to satisfy the US government, the damage was done elsewhere.
Partially as a result of its public flogging, Microsoft became perceived less as an innovator and more as a bully. Strategically, it was forced to dedicate more time and attention to protecting what it already had — a monopoly over computer software and the dominant web browser — than conquering new territory — the web itself, and then mobile phones. Soon after came Google, then the iPod, iPhone and Facebook itself. Microsoft’s existential crisis did not cause any of these, but the company would almost certainly have put up a better fight against them if it was not hobbled by its battle with regulators.
It is far from a failure these days — cloud computing and business software have made it a $700 billion (Dh2.57 trillion) giant — but few would argue Microsoft has the influence it did at the turn of the century.
Which brings us to Facebook. While Zuckerberg appears unlikely to face the same antitrust battles as Gates did (Google is a more likely candidate for that particular honour), he does find himself in a somewhat similar position to that his idol faced 20 years ago.
The technology wars of today are as much about privacy and information, not monopolies, and in that context Facebook is the primary target. The Cambridge Analytica scandal that has enveloped the company in the last two weeks over the harvesting of 50 million users’ data has sparked demands that Zuckerberg, like Gates, testify in front of Congress and members of parliament in the United Kingdom are also pressing him to appear (the former seems more likely at this stage).
Zuckerberg is an accomplished public speaker these days, but the image of him being sworn-in and berated for hours by politicians still risks breaking the image of him that Facebook has so carefully massaged.
Facebook, like Microsoft, could well emerge from the current crisis without being directly punished by regulators. Those in the US have the most power to rein in the company, but have typically been friendly compared with more toothless counterparts in Europe (current UK data laws allow for a maximum fine of £500,000 [Dh2.57 million] — a sum smaller than the revenue Facebook generates in 10 minutes).
The danger instead looming for Facebook is the same one that ultimately knocked Microsoft off its perch, and left it spending years attempting to regain its lost relevance — distraction. Part of the reason Facebook has been so successful is because it has been quick to spot potential dangers and deal with them, as Snapchat will attest. If its current crisis means it becomes more uncertain about such bold moves, it may cede the future in a way it has refused to do so until now.
Signs of this are already emerging. Last week, Facebook reportedly delayed plans for a video calling device it planned to unveil in May, apparently because of growing privacy concerns around the Cambridge Analytica controversy.
Zuckerberg has imitated Gates’ rise to the top. Facebook may yet imitate Microsoft’s fall.
— The Telegraph Group Limited, London, 2018
James Titcomb is technology news editor and senior columnist.
