Bill Gates: Microsoft Government Leaders Forum Americas

Remarks by Bill Gates, Chairman and Chief Software Architect, Microsoft Corporation
“Enabling Innovation and Prosperity in a Connected World”
Microsoft Government Leaders Forum Americas
Washington, D.C.
March 15, 2006

EUGENIO BEAUFRAND: Welcome back. It’s great to have Bill Gates with us today. So, we’re just backstage remembering how the Government Leaders Forum got started, I guess, eight years ago now in a modest event in Seattle, and how much he really enjoys coming here every year and sharing with you his vision of the impact of technology in government, and more importantly to hear from you on the challenges and issues that you’re facing in your country.

So, please join me in welcoming the Microsoft Chairman and Chief Software Architect Bill Gates. (Applause.)

BILL GATES: Well, good afternoon. I’m excited to be here and get a chance to talk about some of the big changes in technology that create an opportunity to make more efficient government systems, and really redefine the way that citizens think about how they work with government and how efficient communication takes place.

Obviously, we benefit immensely from the exponential improvement that’s taking place in the underlying technologies. Chip technology is subject to the exponential improvement referred to as Moore’s Law, and that has not only stayed true for the last 20 years, giving us a million times the amount of computing power at a much lower price, but certainly will hold true into the future as well. And so when we think about what we can do with computing, we no longer need to think of performance as that limiting factor.

Likewise, some of the related technologies, the ability to store information, the size of the disk, is actually improving even faster than chip capabilities. So, in the past, it would have been impractical to think about storing all of the videos of your training sessions and your meetings, and making those easily accessible and navigable to all your employees, or even where appropriate to citizens. Today, the cost to do that is extremely low, and is almost commonsense to let people refresh their skills, or stay in touch even if they work at a distance. So, the cost of disk technology is an incredible enabler.

Likewise, the performance of cyber networks has gone up again at exponential rates, and so where it’s possible to have that kind of connection, the ability not just to send data, but to send high definition video, even targeting individual viewers now becomes practical, and so what we used to think of as TV is completely revolutionized. The idea of channels goes away, the idea of targeting, the advertising, targeting the material based on your preferences, so that pieces of news that you see depend on your interests becomes just commonsense.

Software Breakthroughs

Software breakthroughs play a big role here as well. Historically, a phone was something you used to make phone calls. Today, the idea that your mail and calendar are there, that it just connects up to exchange, it’s secure, it’s synchronized, that’s kind of commonsense for all the new phone platforms. In the future, you’ll be able to speak to your phone and have that recognition, let you navigate the information, or send off short messages. You’ll be able to use the camera on the phone not just for pictures, but if you see a sign you want translated into your language, or you have an expense receipt that you want to take a photo of and have the numbers there recognized and filed away on an automatic basis, if you have a person you’re meeting, they give you their business card, you can take that photo and off it goes and gets stored in your Contacts. In fact, if you take a picture of them, that’s stored there as well. So, it becomes a very intelligent device. The ability to show maps, show things that are nearby, to be the digital wallet, all of that will be common place for that device in the pocket.

And yet, 10 years ago, even the idea that your music collection would move away from physical CDs was not something that people took for granted. Now that’s happening, and happening in a very rapid and exciting way. So, software can continue to improve, and that’s why Microsoft has dramatically increased its R&D budget, more than doubling it in the last five years. It’s over $6 billion a year. A lot of that work is invisible. The work we do for security, that’s about 30 percent of it, and making that more something where you don’t have to get involved, it’s built into the system, that’s very critical to us. Making these management tools, so that instead of visiting individual systems, you just set a policy and you can know that it’s applied very broadly to those systems. Being able to see the behavior on a system, and see if it’s unusually slow, and before that person has to pick up a phone and call, sending an alert, gathering information, so some very automatic diagnosis can be done, even comparing it to whatever database Microsoft has from the experience of all Windows users, and being able to make that far less of a manual process to figure out what’s wrong and actually use the network connection to send the updates so that you’re never having to actually go visit the machine itself. Things like that can reduce complexity and free up IT investment to go into the new areas, the wireless networks, the portable machines, collaborative Web sites that define the future opportunities.

When I was thinking about the different government systems, I thought, what are some of the key trends that really pull these things together, and how can I describe the neat new things I’m seeing in a way where it can help you imagine the places where you’re not yet using a digital approach that you might be able to put that in place? So, I picked what I think of as the three big trends with some examples of that. Hopefully it will stimulate ideas about where, given the basic infrastructure, the Internet, the PC, how you can get far more out of that really by just a trivial investment, have the working style be far more effective.

First Trend: Collaboration

The first trend is collaboration. Historically, people collaborated by meeting face to face, or e-mail has become a key part of that. Now, both of those are great techniques, will continue to be very important. Voice mail was important, but it was isolated from electronic mail. So, one of the most basic things we’re doing is using the Exchange system now to bring your voice mail and your e-mail in together, letting you dial in to the system, and not only hear voice mail, but have text-to-speech that lets you go through your e-mail, or navigate your calendar as well. And so, no more dividing line between those different worlds.

But even more important is letting people connect and share both in real-time, or when they’re not working at the same time, connecting asynchronously. In real-time, we call that Live Meeting, where in addition to connecting up your phone, you can connect your screen up, and so talking through problem, going through a discussion session, editing a document, you can do that even if you’re in a different location. And it’s simply using the Internet to make that connection, and to have that sharing capability. And that’s, of course, some work, one to one, one to a hundred, one to 10 thousand, and it’s really reshaped for Microsoft how we keep up to date. And we’ve reduced our internal travel, travel by employees, by over 30 percent since we’ve been able to put that into place.

In terms of sharing things in a collaborative way, what you really want to do is be able to create Web sites without any programming, and that’s what we’ve been working towards with SharePoint, particularly the new version coming out next year, the idea that you can simply say, okay, I want to have a discussion group about this topic. I want to have blogging, or editing things that on the public Internet is called the Wikipedia, and I want it to be secure, administrable by my key people, backed up the right way, we’ve taken those concepts and just built them in as a template to that SharePoint infrastructure that is standard in Windows Server. So, collaboration, I think the way to frame this mentally, is to say, what groups of my employees do I wish could share best practices, hand off work to each other, look at the status of things, have group discussions, which of them could benefit from that, and just connecting them up to a SharePoint server where IT doesn’t need to get involved when they create these new sites, that’s the foundation that lets you do that.

A good example in the United States is the Illinois Department of Central Management Services, they put all their procurement people there, and so now the procedures, the handoff, the major procurements, there are Web sites for those things. If somebody goes on vacation, you get a handoff, you can see if something is coming up on a deadline. A very simple system, had a very dramatic benefit in making those people more effective and, of course, that means saving the State millions of dollars, and also having a learning culture where people are seeing how things are done, and working in a new way.

Another example down in Chile is called “ChileCompra.” Again, this relates to procurement, and here it’s an electronic platform that includes the structured part of listing things, making that public, making it obvious to people that there was openness in terms of how the bidding takes place there. And it fits into that overall agenda that Chile is having around their digital agenda, where authenticating people who connect up is very straightforward. I hear the benefits are pretty dramatic. The estimates are that they’re saving $60 million by more competitive bids, and actually allowing small businesses that wouldn’t have been able to participate, because they don’t have the sales force, now, because it’s a discoverable electronic process, to come in and see where they can be involved.

A final example is one that is pretty dramatic, where, in Louisiana after Katrina, the ability to exchange information really needed to cut across departmental boundaries. A big problem with IT systems is that often these collaborative sites can bridge if you can just set them up and let people connect up, let them have search commands to find these things, you can get people sharing information about emergent issues. Obviously with Katrina that needed to involve the Red Cross, it needed to involve a number of state agencies, federal agencies, and have people come up and register where they work, they can find family members, other people would be able to go in and look at that. And even connecting it up to the satellite imagery system that we have, so you can look at different locations, see the status of things, the schedule for when things are going to change. Over 300,000 citizens connected up and communicated through that system, and yet it needed to be set up within a few days, and it needed to deal with the fact that many of these sites had had their Internet connectivity brought down in a way that meant that their connections were interrupted and that they needed to be able to work with an offline access. So they actually used the Groove capability that lets you work that way.

Second Trend: Mobility

A second trend that’s complementary, but kind of amazing as well, people are now thinking about getting access to information wherever they go, so this is mobility. Of course, we’ve had portable computers for a long time. They’re getting smaller, faster. That improvement by the hardware vendors to make them thinner, less expensive and lighter, actually we had a big milestone just last week when a number of our partners brought out what we call Ultra-Mobile PC. This is an example of one, this one actually happens to come from Samsung. You can see it’s a very high resolution display. This is a device whose price ranges from $600 to $1,000 in its basic configuration.

The information is just automatically brought on here by the mail system and the file replication system, so you don’t have to work to bring it on. We’ve made it so that actually not only can you use the pen, so it’s got a pen built in, so you can work with ink and things, but also for a lot of things, if you’re just browsing information, we’ve made it so that just touch works very well. We actually had to invent an idea of how you use your thumb to make these things very simple. So that’s been a nice advance. Also for a lot of users who are used to a thumb-type keyboard entry, we actually took this idea. So if you press this, you can see we bring up – you may not be able to see it. We bring up a little soft keyboard, so a lot of users can do entry that way as well.

So ink, speech, touch, all of these things, giving people a way of interacting. So you’ll have a full spectrum of devices, from the phone in your pocket, to the larger screen phone, to the low-end Tablet device, all the way up to a large Tablet, then of course on your desktop moving up to a screen that used to be 15 inches, now would be 20 inches, or even 24 inches, so you can work with more information, but all of those a common architecture so that the applications, what you learn, the way you work is all identical and connected through these amazing wireless networks.

A good example where mobility is in place is the U.S. Army Advanced Technology Center for their medical application, called Battlefield Medical Information Systems, actually took a combination of Pocket PCs, which are the smallest devices, connected up to those for diagnosis and information capture, as well as being able to connect up these kinds of devices. So they wrote one application, but it could target interaction with the patient record and what was going on, and immediately get the input to that person. Both of those let you use ink input so your notes can be captured very quickly, and yet go back up there and be part of that permanent record.

Third Trend: Digitization

The final trend is digitization, where the move [is] away from paper forms, the move away from paper records, and files, and warehouses, to doing those things on a digital basis, but not just on an image-capture basis, on a structured basis, so that mining the data, finding the slice of data that’s important, that all becomes commonsense. We see this from consumer, where the photos you take of your kids as they grow up, looking at those by location, by time, eventually even with the software recognizing who is in the photo, so it can help select those out, or making it easy for you to take things, so that you can navigate by those different sets, and being able to share those photos very easily, that is just expected, and a big change away from the shoe box, and yet with the right type of backup approach even more secure than it would have been on a physical basis.

Government records, same thing, the need to have explicit policies about what you keep, about what you don’t keep, the digital realm lets you be more explicit about those things, to understand who should access which piece, and not only have that, but also have an audit trail, so somebody is doing unusual access that will jump out in terms of a profile of usage there that you’ll be able to navigate with very visual tools. A great example of this is actually my own state, the state of Washington, where they were building up a lot of physical records and made the jump now to do that on a digital basis with a rich content management system, and that lets them have the access, save money, and I think is a very forward looking example.

A final example is one that I think really brings all these trends together, digitization, in this case it’s educational, so the curriculum, mobility, empowering the students with a Tablet-type device, and then collaboration, creating a community around students, parents, teachers, and so that when there’s a schedule change, or a problem taking place, or a parent wants to know what the assignment is, or the attendance record, all of that information access is there in a very simple way.

The place this got pulled together in a very leadership example is what’s called Philadelphia School of the Future. They build Web sites that are designed for the parents to come in and teachers being able to take the subset of information that should be visible to the parents, authenticating the parents, having that back and forth work in a very easy way. Even bringing in the normal processes, the human-resources applications that the teachers have to interact with, the student records applications, all of those are set up there. Then they build portals, whenever there’s an issue that the school wants input on, the idea that you can have that discussion group, or blog type approach, they just – that’s a component set in the right place in the Web site. They put that in, and then without doing any development, that’s very straightforward.

They’ve been using the Tablet PC, they will be trying out the Ultra-Mobile PC that gets you to a lower price point even than before. They’ve actually issued the students smart cards, so the idea of how they authenticate and control the information, they’re a pioneer there, because the whole world over time will move away from passwords to using this type of smart card.

I think the most advanced idea is how this affects the curriculum. There’s a lot that has to be done to think through a digital curriculum, and how it lets the teacher customize, lets them bring in video, lets the students kind of explore and find things that they are interested in, and bring back to the classroom. And one of the software tools they’ve built is what they call the Virtual Teaching Assistant, and they’re willing to share that with people. So as we get projects like this, the ability to not only share best practices, but literally take some of the code, some of the content, and make sure they get reused, built upon, and even go back to help each other, I think is one of the really exciting things as we’re taking digital technology and finding the new applications.

Conclusion

In the world of government, there’s great work going on, I’d say, in many, many areas around the world, judicial systems without any paper in some locations, educational systems that are really moving into the non-textbook world. Medical systems, there I don’t think anybody has achieved the ideal yet, but that’s a critical issue that the opportunity there to understand that becomes better, to make less mistakes, to reduce the costs, and waiting, and raise the resource utilization, certainly a great investment that’s taking place in that.

So I’m excited that we got the group together to share ideas over these last few days. It’s part of a process where we want to be a real enabler, and getting you to think even more aggressively about how technology can help. We’re certainly committed not just in our research budget, but in our dialogue with you to understand how we can set our product priorities in a way that can have a huge impact. I think there’s a big opportunity for us working together.

Thank you.

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