Living on Big Brother's Allowance

William H. Gates III, Class of 1977, is a nice man.

Although the founder of Microsoft undoubtedly spends most of his time "innovating" and exercising his monopoly power in the software industry, the famed Harvard dropout is also responsible for offering $400 to every man, woman and child in California.

Microsoft has for some time offered a $400 rebate at stores including Best Buy, Office Depot and Staples to customers signing up for three years of Microsoft Network Internet service. But through a quirk of commercial law, California residents can cancel the service at any time—and keep the rebate. In essence, Microsoft will pay them $400 to buy computer equipment.

After the story was published Wednesday morning in the San Jose Mercury News, mobs of Silicon Valleyites left their monitors and lined up to receive $400 of Microsoft's money. At one Best Buy store in Milpitas, Calif., more than 125 customers lined up to get the rebate, and some had to be turned away.

Microsoft, surprisingly, did not immediately cancel the deal. Spokesperson Tom Pilla said that he expected few customers to cancel the $21.95-a-month Internet service "because we think the value that we're offering customers, as we've seen from the many sign-ups, is tremendous." However, one ungrateful shopper told the Mercury News, "I really don't like Bill Gates." He bought a $407 set of two-way radios for $7.

Microsoft stock fell 3 13/16 in average trading yesterday.

The cause of the free-for-all was a five-year-old California law prohibiting companies from requiring customers to purchase anything when they take out a loan. Initially designed to shield consumers financing a car or home purchase, the law applies because Microsoft's rebate agreement is structured as a loan to the consumer. A similar law also protects Oregon residents. Other companies that offer rebates, including CompuServe, have differently structured rebate agreements. They are still reviewing their compliance with those laws, but for now, only Microsoft is feeling the holiday spirit.

Regardless of the outcome, Dartboard wishes to commend Microsoft for its generosity and encourage the residents of California and Oregon to profit by it. Giving $400 to every person in California would cost Microsoft more than $12 billion; but then again, with a $500 billion market value, Microsoft can afford it. In the meantime, let's all thank Bill Gates, and then go out and buy a computer with his money.

—Stephen E. Sachs