Vanity Fair has an article on Microsoft’s corporate culture, and some ways in which that culture crippled innovation at the company. One of those ways is responsible for Microsoft—and Bill Gates in particular—rejecting a prototype for a touchscreen e-reader—in 1998.
According to [writer Kurt] Eichenwald, Microsoft had a prototype e-reader ready to go in 1998, but when the technology group presented it to Bill Gates he promptly gave it a thumbs-down, saying it wasn’t right for Microsoft. “He didn’t like the user interface, because it didn’t look like Windows,” a programmer involved in the project recalls.
The biggest reason for rejection was that Gates didn’t like the touchscreen—he considered it un-Windows-like. So the group that came up with it was shuffled into other project groups and the prototype was shelved.
A lot of sites reporting the story seem to act as if it were the latest iteration of Gates’s famous line that “640 K is all the RAM anyone will ever need.” And the Telegraph even compares it to Decca’s decision to reject the Beatles. But let’s be fair—1998 was the era of the Rocketbook and other dedicated e-readers that fizzled. Even Microsoft’s Windows CE machines, which the article claims gave Microsoft “the lead” it “squandered,” were distinctly second fiddle to Palm and Handspring devices at the time as far as I can recall. There’s no reason to expect that a Microsoft touchscreen reader would have done any better than the Rocket.