Steal the enemy's base at the start and build a technological empire.

Chapter 107 Microsoft-Intel Joint Meeting

At 7:00 PM sharp, the video signal was connected.

At Microsoft, Bill Gates and Steve Ballmer sat in the conference room. The camera angles were perfectly adjusted, and the whiteboard behind them was clean and ready for recording.

On the Intel side, Andy Grove and President Craig Barrett appeared on the screen. Grove looked serious, while Barrett was reviewing documents.

"Bill," Grove's voice came through the speaker, crackling with static, "we've verified what you said. Dell, Compaq, and HP are indeed working with that Chinese company on a new interface standard."

Ballmer interjected, "They even brought in AMD for chip design."

“We know.” Barrett looked up. “We were informed today that AMD has taken on a ‘major chip design project,’ details of which are confidential. It now appears to be this UHSB controller chip.”

Grove tapped the table: "Let's get this straight, are the technical specifications for this UHSB accurate? 5Gbps? Reversible?"

"Our initial analysis suggests the parameters are reliable." Gates pushed a report in front of the camera. "These are the test data obtained by the technical department. The prototype's measured speed is over 500Mbps, which is 300 times faster than USB 1.0. The interface design is 40% smaller than ours, and it can indeed be plugged in either way."

"Damn it," Grove cursed. "USB 1.0 has only been out for four months. On our roadmap, USB 2.0 won't be available until the end of 1999."

"Too late." Barrett shook his head. "According to their timeline, the product will be available this July. We're two years behind."

There was a few seconds of silence in the meeting room.

"So," Grove leaned forward, bringing his face close to the camera, "this company, is it called StarCraft, right? They're not only making operating systems to compete with Windows, but now they're also making interface standards to compete with USB. They're fighting on two fronts, and they've chosen the perfect timing."

"Yes," Gates nodded. "They're playing the timing game. USB 1.0 was too weak, which gave them an opportunity."

"So what do we do now?" Grove asked directly. "What's your plan?"

Ballmer continued, "We have initially drafted four countermeasures: technological challenges, market FUD, ecosystem suppression, and alliance fragmentation."

"Explain in detail," Grove gestured.

"First, technical concerns." Ballmer opened his notebook. "Find a third-party lab to test the weaknesses of UHSB. Electromagnetic interference issues during high-speed transmission, heat dissipation issues during prolonged use, bandwidth allocation issues when multiple devices are connected simultaneously. You can always find technical flaws."

Barrett nodded: "We'll handle this. Intel's labs can do comprehensive testing. We'll have a preliminary report within a week."

"Second, market FUD," Ballmer continued, "spreading doubts about the new standards through the media and industry analysts. Stability, long-term support, compatibility—enterprise customers fear uncertainty the most."

"We need specific examples," Grove said. "We can't just talk about it."

"We can create case studies," Gates began. "For example, we can find a partner, pretend to encounter a UHSB compatibility issue during testing, amplify the problem, and get the media to report on it."

"That works," Grove noted. "And the third one?"

"Third, ecosystem suppression," Ballmer said. "UHSB requires peripheral support. There are currently no UHSB devices on the market. Microsoft can provide hardware partners with deep Windows optimization support, on the condition that they temporarily suspend support for UHSB and prioritize support for USB."

Barrett frowned: "This requires a trade-off. It might involve lowering the licensing fee."

"It's worth it," Gates said. "It's a matter of survival."

"Intel could do something similar," Grove thought. "Provide technical support to motherboard manufacturers, on the condition that they don't reserve a UHSB interface on the motherboard, or place the UHSB interface in a secondary position."

"Okay." Ballmer noted it down. "Fourth, divide the alliance. The four founding members have different demands. Dell wants cost, Compaq wants differentiation, HP wants stability, and StarCraft wants an ecosystem. Find the points of conflict and amplify them."

Grove scoffed. "That's simple. Dell and Compaq are bitter rivals. HP's enterprise customers hate risk. We can approach them separately and offer different promises."

"But be careful," Gates cautioned. "The alliance agreement has a veto clause. If a member withdraws, their founding member seat is permanently revoked and cannot be transferred. This means that buying them out is very costly, and once they withdraw, they can never get back in."

"Then let's create conflict, we don't necessarily have to force them to withdraw," Grove said. "Let them argue about the standards, and buy time. Time is in our favor."

Barrett flipped through the documents in his hand: "I'd like to add something. At the chip level, AMD is designing the UHSB controller chip, but manufacturing still relies on foundries. Intel can put pressure on the foundries."

"Specifically?" Ballmer asked.

"TSMC and UMC are AMD's main foundries," Barrett said. "Intel is their major customer. We can imply that if foundries prioritize UHSB chip production, it could affect the priority of Intel's orders."

"Will it work?" Gates asked.

"It works," Grove affirmed. "Foundries don't dare offend major clients. AMD's order volume is small, so its priority can be pushed back. Delays in chip manufacturing will delay the entire product launch."

"Okay." Ballmer quickly took notes. "The chip manufacturing delay can be reduced by at least three months."

There was a few seconds of silence on both ends of the video call as they processed the solution they had just discussed.

"There are also legal options," Gates began. "Patent litigation. UHSB may be infringing on our patents, or Intel's patents."

Grove shook his head: "The patent pool structure is designed to defend against lawsuits. Alliance members share patents, so suing one is equivalent to suing all of them. Moreover, the standards are open source, making infringement very difficult to prove."

"But you can threaten," Gates said. "It doesn't necessarily mean you'll actually sue, but you can send a lawyer's letter to create the impression of legal risk and make potential partners hesitate."

"Sure," Grove agreed. "Intel's legal department can prepare."

Barrett glanced at the time: "We need a timetable. When will the measures be implemented, and when will they take effect?"

Ballmer presented a draft: "Technical testing will begin within a week, with a preliminary report in two weeks. Market FUD can begin tomorrow, leaked through well-connected media. Ecosystem suppression will require two weeks of negotiations, with the first batch of agreements signed by the end of the month. Alliance fragmentation will begin this weekend. Chip manufacturing pressure will be applied next week."

"Intel is cooperating with the timeline." Grove nodded to Barrett. "We're leading the technical testing, starting this week. Chip pressure next week. Legal threats two weeks in advance."

Gates concluded: "What is the ultimate goal? We need to be clear about that."

"Two goals," Grove said, holding up two fingers. "First, delay the widespread adoption of UHSB, at least until the release of USB 2.0 in 1999. Second, if possible, make the UHSB standard fail, at least confining it to a specific niche market."

"Agreed," Gates said. "The key is delay. As long as we can hold out until USB 2.0 is released and the technological gap narrows, we'll have a chance to win."

"There's another issue," Ballmer cautioned, "the Star System. If UHSB succeeds, it will leverage the hardware advantages of the Star System. Users might choose computers pre-installed with the Star System specifically for using UHSB devices."

"Then let's suppress them on two fronts," Grove said. "We'll suppress both the interface standard and the operating system simultaneously. The Wintel alliance can't afford to lose either line."

The video conference moved into detailed discussions. Both teams confirmed the division of labor, timelines, and resource allocation item by item.

At 8:10, the main matters were finalized.

"Progress is synchronized monthly," Grove said, "with weekly briefings shared."

"Okay," Gates agreed. "First synchronization will be on January 15th."