- The Washington Times - Tuesday, February 1, 2000

DAVOS, Switzerland Bill Gates told world business leaders yesterday that Microsoft would refrain from the trend of media mergers and stick to creating software.

Steve Case, chief executive of America Online, said his company's blockbuster merger with Time Warner would enable the two companies to use new technologies to create "compelling" consumer services they would have been unable to develop as separate companies.

Mr. Gates and Mr. Case spoke at a panel discussion as the six-day World Economic Forum shifted its focus to the future of the Internet.

Mr. Case said AOL and Time Warner wanted to continue building bridges to make telephones, televisions and computers work better together.

"The next step is trying to think through from a consumer standpoint what is the best way to use these new devices to take advantage of new networks," Mr. Case said. Then, the company could build services that "really can improve people's lives."

Mr. Gates congratulated Mr. Case on the merger announced last month, but said Microsoft wasn't planning any media takeovers of its own.

"The strategy that my company is pursuing has really been the same for the last 25 years," Mr. Gates said. "It would be fun to own a movie studio, but I don't have any expertise, so we're going to stay away from that.

"Instead, I think there's room for a company who's main goal is to create software and allow that software to be a very empowering tool," he said.

The resort town of Davos was calm yesterday under a new blanket of snow. A violent demonstration against big-business interests Saturday caused an estimated $62,500 in damage, police said.

Russia faced renewed criticism over its economic and political situation, this time from U.S. financier George Soros. He said that "with the political developments moving in the wrong direction, the International Monetary Fund should pull out of Russia."

Foreign institutions and investors "have lost the ability to influence the direction of events" in Russia, said Mr. Soros, chairman of Soros Fund Management.

For 10 years, "we had the ability to influence things in Russia and move them in the right direction, and we flubbed it," Mr. Soros said. He pointed to the conflict in Chechnya as a worrying sign of political trends there.

On Saturday, the IMF's No. 2 official, Stanley Fischer, said the fund might delay paying Russia the second installment of a $4.5 billion loan until after presidential elections in March.

Russian Finance Minister Mikhail Kasyanov cautioned Western governments yesterday against stepping away from helping get the country's economy back on track after its 1998 financial crisis. He said the West would be risking its chance to further democracy in Russia.

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