News : Gates leaves Microsoft to focus on philanthropy

By Daisuke Wakabayashi

SEATTLE (Reuters) - Sensing the start of a personal computer revolution, Bill Gates dropped out of Harvard University in 1975 to start Microsoft Corp and pursue a vision of a computer on every desk and in every home.

Three decades later, Gates is set to step down on Friday from what is now the world's largest software company to work full-time at the charitable organization -- the Bill & Melinda Gates Foundation -- built by his vast fortune.

No longer the world's richest man -- he has been topped by investor Warren Buffett and Mexico's telecoms tycoon Carlos Slim -- Gates says great wealth brings with it great responsibility.

The 52-year-old, whose boyish looks seem at odds with his graying hair, will leave behind a life's work developing software to devote energy to finding new vaccines or to micro-finance projects in the developing world.

As Microsoft's biggest shareholder, Gates will remain chairman and work on special technology projects. His 8.7 percent stake in Microsoft is worth about $23 billion.

Gates first programmed a computer at 13, creating a class scheduling system for his Seattle high school. As he gained more experience, he realized the potential that software held to change how humans worked, played and communicated.

"When I was 19, I caught sight of the future and based my career on what I saw. I turned out to have been right," Gates wrote in his 1995 book "The Road Ahead."

Gates realized at an early stage of the PC revolution that software would be more important than hardware. Working with boyhood friend Paul Allen, Gates founded Microsoft, naming the company for its mission of providing microcomputer software.

PRIVILEGED UPBRINGING

Gates was born October 28, 1955, the second of three children in a prominent Seattle family. His father, William Henry Gates Jr., was a partner at one of the city's most powerful law firms, while his late mother, Mary, was an active charity fund-raiser and University of Washington regent.

He was introduced to computers at the exclusive Lakeside Preparatory School, where the teen prodigy began programming in BASIC computer language on a primitive ASR-33 Teletype unit.

It was at Lakeside that Gates met Allen, a student two years his senior who shared his fascination with computers.

"Of course, in those days we were just goofing around, or so we thought," Gates recalled in "The Road Ahead."

During his two years at Harvard, Gates devoted much of his time to programming marathons and all-night poker sessions before dropping out to work on software for the Altair, a clunky desktop computer that cost $400 in kit form.

Also at Harvard, Gates became friends with an ebullient Detroit native who shared his love of math and cynical humor. Gates eventually talked that classmate, current CEO Steve Ballmer, into leaving business school to join Microsoft.

Gates dropped out of Harvard and relocated with Allen to Albuquerque, New Mexico, where they established Microsoft.

Their big break came in 1980 when Gates and his carelessly dressed young colleagues signed an agreement to build the operating system that became known as MS-DOS for International Business Machines Corp's new personal computer.

In a critical blunder by IBM, Microsoft was allowed to license the operating system to others, spawning an industry of "IBM-compatible" machines dependent on Microsoft software.

"His legacy has to be as one of the shrewdest businessmen and technologist of the 20th century," said Michael Cusumano, a professor at the Massachusetts Institute of Technology's Sloan School of Management.

Microsoft went public in 1986 in one of the most celebrated offerings of its time. By the next year, the soaring stock made Gates, at age 31, the youngest self-made billionaire.

Overseeing Microsoft's steady growth, he became known as a bare-knuckles businessman and manager, sometimes dismissing a suggestion as "the stupidest thing I have ever heard."

Microsoft grew to dominate its industry and became the target of a landmark antitrust case, which it fought every step of the way before eventually settling with U.S. prosecutors.

Rob Helm, director of research at independent research firm Directions of Microsoft, said Gates will go down as one of the great businessmen in history like John D. Rockefeller -- for better or for worse.

"He's never going to be necessarily a widely admired figure, but someone who created an activity that came to represent a chunk of the American economy."

(Editing by Braden Reddall and Maureen Bavdek)