Gates Takes Aim At IBM At Microsoft SMB Gathering

"For every dollar of our sales, eight dollars go to partners (in services revenue)," said Gates in a Manhattan Chamber of Conference address at Microsoft's New York sales office in mid town Manhattan. "We are one quarter the size of IBM in terms of people, but our impact is quite a bit greater."

Gates also took aim at IBM's somewhat checkered software past with IBM OS/2. Years ago, Gates noted, that Microsoft's biggest operating system competition was IBM's OS/2. "They had ten times as many people as we did and somehow we won," said Gates, who did not mention that Microsoft at one time co-developed OS/2 with IBM.

Ironically it was only one month ago that the Microsoft Chairman shared a New York stage with IBM Software Group Executive Steve Mills to tout the two company's partnership on the next generation of Web services protocols to enable e-business.

Gates' IBM dig came just hours after he formally launched Microsoft's Office System 2003 linup at the Hudson Theater in New York. At the small-business event, Gates touted Office 2003 and Microsoft Small Business Server as providing superior functionality at unprecedented price performance.

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Microsoft is making a massive push into the small business market with Office 2003 as well as its recently released Small Business Server 2003 Standard Edition priced at $599 and its Small Business Server 2003 Premium Edition priced at $1,499.

Office System 2003--which covers six suites, 11 products, four servers, one service and Solution Accelerators--was led by the official launch of Office 2003, Office Live Communications Server 2003 and Exchange Server 2003. Outlook 2003 is part of the Office 2003 suite and serves as the client for the Exchange 2003 e-mail server.

Gates said small businesses is where he is "most impressed with what people do with technology. They do way better than large businesses." On the other hand, Gates said, small businesses are getting less of the benefits of technology when compared with large enterprises.