Gates' historical legacy may focus more on philanthropy than on Microsoft

Charitable work seen as breaking new ground, both in its scale and his methods

A legacy of creating social value?

Peter Frumkin, a professor of public affairs and director of the RGK Center for Philanthropy and Community Service at the University of Texas at Austin, said that the sheer size of the endowment of the Bill & Melinda Gates Foundation, combined with the unique approach being taken by Gates, ensures that he will be regarded as one of the preeminent philanthropists ever.

"The scope of what he's doing is so enormous that it sent out shock waves in the philanthropic world," Frumkin said. As a result, he added, "the social value created by the Gates Foundation will be enormous, and could dwarf the value creation of Microsoft."

Gates differs from other philanthropists not just in the amount of his giving but also in the methods he's using, according to Frumkin. "What he does is efficient and grounded in data," Frumkin said. "And he only tackles problems that he believes are solvable with his resources. For example, when he saw mortality charts in a government report, he recognized that by spending a great deal of money in disease prevention, he could make a difference."

Stacy Palmer, editor of The Chronicle of Philanthropy, a newspaper that covers nonprofit organizations, thinks that history will view Gates both as a philanthropist and a businessman. "The technological changes he fueled transformed society, so unless he can do something like wipe out all the diseases in Africa, he will be remembered for both," she said.

Nonetheless, Palmer said his contributions to philanthropy - both financial and otherwise - will be enormous.

"The amount of money he is giving away is unprecedented," she said. And like Frumkin, she thinks that the hands-on, results-oriented approach being taken by Gates may help change the way that others give away their money.

Furthermore, Gates is taking on philanthropic challenges that others have ignored, such as the way that vaccines and health care services are delivered, Palmer said. She added that unlike most American philanthropists, he has chosen to focus his efforts on Third World countries. His giving is unusual in yet another way: he and his wife set up their foundation so that it has to give away all of its money within 50 years of their deaths.

"A lot of people have found that foundations that have been in existence for a very long time lose their effectiveness over time," Palmer said. "Gates wanted to make sure that didn't happen."

A great monopolist, in more ways than one?

George Colony, CEO of Forrester Research, isn't convinced that Gates' work at Microsoft will be shunted into the background historically. "The jury is still out on whether he chose the right causes and places to put his money," Colony said of Gates' philanthropic efforts. "We won't know that for at least 10 to 15 years."

From a business legacy standpoint, Colony takes the largest criticism of Gates and stands it on its ear.

Gates will be seen as "one of the greatest monopolists in American history," Colony said. But he doesn't mean that in a negative way. By establishing Windows and Office as dominant technologies, Gates "created tremendous value in the standardization of systems," Colony said. "Because of him, we take it for granted that you can easily share word processing files, spreadsheets and other documents."

Colony doesn't view Gates as an IT visionary. "His technology was derivative, not original," Colony said. "His products were always pretty good, but not terrific, and the pricing was never onerous." But in Colony's eyes, he was visionary businessman - one whose market exploits were good for technology users as well as Microsoft and its vast ecosystem of business partners.

"We all benefited from that monopoly," Colony said. "And that will be his biggest legacy."

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