Paul Allen is Upset

Paul Allen, the billionaire co-founder of Microsoft, is an unhappy man. In his memoir, recently excerpted in Vanity Fair, Allen makes a number of harsh accusations against Bill Gates and Steve Ballmer, which Sam Gustin ably summarized at Epicenter:


If true, Allen’s account would upend key pillars of the conventional wisdom regarding Microsoft’s history. Many people believed that Allen’s growing distance from the company was prompted in large part by his battle with Hodgkin’s Disease in 1982, The Wall Street Journal noted of the memoir Wednesday.

But Allen writes that he felt alienated from Gates, because of the latter’s hard-driving and combative personal style.

“My sinking morale sapped my enthusiasm for my work, which in turn could precipitate Bill’s next attack,” Allen writes, according to the Journal.

“I had helped start the company and was still an active member of management, though limited by my illness, and now my partner and my colleague were scheming to rip me off,” Allen writes of Gates and Steve Ballmer. “It was mercenary opportunism, plain and simple.”

It’s not clear what Allen’s motivations were in writing the new book. With an estimated net worth north of $10 billion, he certainly doesn’t need the money.

I would be somewhat more sympathetic towards Allen if I had any reason to believe that he was as central to Microsoft’s success as he now claims. His exploits since leaving Microsoft suggest otherwise:

Microsoft’s “other” co-founder, Paul Allen, has had a long string of business failures since leaving Microsoft. It’s actually quite impressive. One of his most high profile ventures, back in the 90′s, was Interval Research, which was designed to be a pure research institute “done right.” It was described as trying to replicate Xerox PARC, but that it would actually commercialize the amazing ideas. Of course, as we’ve pointed out for ages, ideas are only a small part of innovation. Actual execution is the really difficult part, and one thing Interval was never able to do was execute. After eight years and over $100 million of Allen’s money, the operation wasshut down back in 2000. That was about the last we’d heard of Interval… until now. 

Because, while Interval was unable to actually execute, thanks to the wonders of the US Patent system, it was able to secure lots of patents, and now it looks like Paul Allen has gone full on patent troll. He’s using those patents to sue Google (and, separately, YouTube), Apple, AOL, eBay, Facebook, Netflix, Yahoo, Office Depot, OfficeMax and Staples – you know, the companies that actually did innovate and did execute — for being successful where he failed.

Perhaps I’m being unfair, but Allen’s history of rent-seeking, whether in the form of patent abuse or trying to extract taxpayer subsidies for lavish sports complexes, doesn’t fill me with much confidence. 

Reihan Salam — Reihan Salam is executive editor of National Review and a National Review Institute policy fellow.

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