(Applause.)

BILL GATES: Good morning. It’s great to be here. I was hoping to be here a year ago, but I got a call from the Senate, and so I had to get a note as an excuse, and we got Robert Reich to come down and talk to you. I can say with great sincerity I wish I had been here instead of the place I went to. But one of the great things that has come out of that is that I get to be here today, and there are some exciting advances that have just been made recently that I get a chance to share with you.

I was looking at the program, and it said at the front, "Shouldn’t You Be There," and I thought, "Yeah, this time I’d better be there." And it said inside, "This time Bill Gates will be there." So this was a command performance, and I’m glad that it worked out.

We talk about this being the Digital Age, and you really can’t pick up any newspaper or magazine today without reading about all the amazing things taking place. The underlying technology is increasing in power so rapidly, it’s very different from anything we’ve seen before. And the impact of getting everybody hooked up, getting them the power of these improving PCs, getting information on the Internet - it really is creating a new age, the Digital Age. And the opportunity to use this for business, entertainment, but perhaps most importantly for education is really very, very exciting.

I can see that schools in the Digital Age will be very different. I had a chance to meet someone who was really quite incredible, the late John Stanford, who was superintendent of the public schools in Seattle. I met with him several times, including at a regular roundtable we have with school superintendents. And I thought he put the importance of your work in the most succinct way when he said, "I am the CEO of children’s destiny." Now, that’s really an incredible job to have.

And there is the chance to do that in a better and better way. Whenever I look at the statistics on schools, I’m always amazed at the size of the organizations you have to manage. Your job is more demanding than that of most businesses: the complexities, the regulations, the different constituencies. And yet, with all those complexities, the importance of what you do is really hard to overstate.

So in this Digital Age, how will things work in a different way? Well, information will be available for everyone. And when I say information, I mean it very broadly: information about what’s going on at the schools, information about subjects that you might want to learn, kids wanting to find other kids learning a similar thing and to collaborate on that. The difficulty of finding those things will be reduced almost to zero as people become comfortable using a PC connected to the Internet.

This will allow us to gather more information, and allow us to tailor things in a better way. It will allow things to be more student-centered. All the different groups-students, teachers, parents - will be able to share their thoughts. Teachers will be able to share with each other in a better way, putting a lesson plan onto the Internet and making it easy to search so that somebody in a very different location can find it, add to it, put it back and start a virtual cycle of sharing with each other.

Students also need to be prepared for a new workplace. Unlike previous advances, like the telephone or the car, where there were several generations before the use of the new technology became mainstream, here we have something that’s happening in a single generation. In a 20-year period, the use of the PC will go from something that no one did as part of their job to being a critical part of the vast majority of all jobs. And that means that tools need to come into play and help prepare people for those jobs.

The ideal here is to give students a sense that there’s a way of reaching out for knowledge whenever they want it, so they find it easy to be lifelong learners.

Now, all this talk about the Digital Age is quite amazing. You know, I live in an environment where I’m using this stuff every day, and so from time to time we go out and we like to survey to see, you know, how is it really being used, you know, where are people finding it frustrating. And we’ve put together a video that captures some of this, gives us a good guideline of where we are on achieving our potentials here. So let’s take a look at that.

(Video shown.)

BILL GATES: So technology is going to do some wonderful things, but we’ve got a long way to go to make it easy to use and to achieve that full potential.

One of the concepts that we think is important is the idea of how information moves around. And there’s a concept here of doing that in a new digital way, which we refer to as "digital nervous system." The idea is that any organization ought to be able to call up the data about its basic operation, collaborate about its planning, make it easy to interact with customers, suppliers (in the case of schools that would be the students and the parents), and really have better organizational reflexes than it’s possible to have when things are simply done on paper.

And so the digital nervous system requires people to step back and think about how they use the Internet, and where it can fit in. And it’s interesting to think about schools, because in this case you have the ultimate knowledge workers - students. Their whole job is to acquire information, to have the flexibility to look at the new developments, to see how those things fit together. So the Internet is perfectly matched to what it is they want to do.

What does a digital nervous system really comprise? Well, in fact, the building blocks are already in place. People are buying PCs, and they’re connecting them up. They’ve got productivity software. They are building databases and buying education-specific applications. The big difference here in what’s being achieved today versus what’s possible is really a question of managing information in a new way, deciding that paper forms really don’t have to be used, that you can start out with the information being digital from the very beginning, and having standards that let the information flow between these various systems.

Well, so where are we in using all of this? Well, a survey was done last year, and it showed that electronic mail is starting to catch on. This pie breaks down the regularity of e-mail use in different schools. And the good news here is 32 percent of schools have 90 percent of the teachers using e-mail, so they’re able to communicate with each other, have parents make - find out what’s going on, make suggestions, be more involved there. That’s a really good thing.

We also see that even a greater percentage, 41 percent of teachers are not connected up to e-mail.

Clearly a lot has to be put in place to make this part of the common sense of how things are done, in the same way that fax machines six or seven years ago were a novelty, but then caught on and became almost a standard thing. I think that in the next three or four years everyone will have e-mail addresses, including teachers. They’ll be reading their e-mail every day, and they’ll encourage people to reach out to them through the simple act of sending them a piece of e-mail.

We look at using the Internet as part of instruction. Again here we see a lot of progress, but a lot still to be done. At 14 percent of the schools, the teachers said that they’re using the Internet as an integral part of instruction, where they encourage the students to go out and find new information there, where they bring that back to the classroom and share and talk about the things that the kids found that were fascinating, or that the kids found that they felt were confusing. At 23 percent of schools, no teachers are doing it.

Now, obviously to get to this point there’s a lot of pieces that have to fall into place, the machines, the connections, the training, and just simply having the ideas of how you involve the Internet, having the best practices there be shared. I think it’s fantastic to see that sites are really getting the critical mass on the Internet that have these case studies and have this information. We manage our site to be a place where people can go to learn about that, but there are several others as well that people are contributing too. And there’s a lot of great award programs from Microsoft and others that recognize people for making these contributions, and really encourage them to be doing more and more of that, and so that it’s not just one teacher making a breakthrough, but those breakthroughs are shared with all the schools and available to them very easily.

We’re involved in a lot of different programs. One of the most ambitious is called the "Laptop Program," and "Anytime, Anywhere Learning." And this is rolled out today in 500 schools here in the United States, with over 60,000 students. We have a special conference that talks about the progress here, and the results have been fantastic. Obviously this is a challenging program to put in place, because it requires a lot of parental involvement, being willing to finance the $30 or $40 a month that it costs to lease an excellent portable computer that can run all of this software.

The benefits though have been really quite amazing. You know, students, because they own that machine, because they can use it as much as they want, it becomes a lot more integral than just being able to visit the computer lab and spend 30 or 40 minutes on the machine.

We had Superintendent Amato from New York District 6 come in and give the keynote at our recent Anytime, Anywhere Conference, and he talked about a study that he’d had a third party come in and do that showed that the students who are involved in this were writing more, watching less TV, checking out three times as many library books. So that’s kind of a fascinating thing for people who thought that this might take away from traditional use of the library as a resource, and spending time with their parents, both working together looking at sites and doing work on the PC.

One of the quotes that came out of this that I think is very powerful is: "I don’t know" has become "I don’t know yet."

He also shared some of the feedback he’s gotten from the parents, and this is one of the letters that he read from. It says, "This laptop program has proven to be the one thing to put my daughter in a position to compete with any student of a superior educational background."

And so here we have a program that obviously can’t be spread to all schools in any near-term time frame, but it is one approach that is working very, very well. And I think this is a period of experimentation. This is a period where we should let people try lots of different things with the technology - how do you involve the students, how do you get the students to be the ones that often manage and help maintain the systems so that there’s no personnel costs or very little personnel costs in setting these things up?

We’re getting a lot of feedback from our education customers about how to improve our software, making it easy to manage and network the computers, so you don’t have to have the expertise in each school, but rather you can just have it centrally and they can reach across the network to make sure that things are running in the best possible fashion.

And there’s also some issues that we’ve found having to do with people, many people using the same computer, making sure there’s nothing that somebody can do that can mess that computer up, so that the next person who comes along definitely has access to all the capabilities of the machine. So in a sense you could call that "bullet-proofing." And the school environment has really been a great one to test out our bullet-proofing technology.

Does the technology plan include training in curriculum integration? A lot of schools are putting up Web sites now where they talk about how they’re doing this, bringing the computer into math, bringing it into physics. I think the old view that computers were effective at quizzes or that learning computer technology was a subject on its own to be isolated from the other subjects, those approaches have proven to have very limited benefits. It’s only when you get the interaction with the computer to be rich enough that it’s part of learning, not just of testing, and when you get the computer to be part of the normal subject, and simply a tool, that you get the potential that is there.

Can you find information on all students? Is it easy to look up and see the trends in terms of attendance and grades? Is it easy to look at your seniors, what colleges are they going to, how does that correlate to the different programs that they’ve gone through?

There’s a lot of very rich data here that can let us identify which approaches are working the best. But as long as the data’s on paper and different isolated systems, it’s very tough to do this analysis. And yet the tools we have, in digital form, are really quite incredible to look at patterns and to be very analytical about, say, what warrants investment, and what doesn’t.

Are you eliminating paper forms? This is a challenge I make to businesses and schools alike, because if they are a source of error, you enter redundant information, you can’t get the advice on what the different options are, because you’re just sitting there with that paper form. And even if it means putting in a PC with a browser for people to enter the data as they’re applying for different things, that’s very easy to do.

At Microsoft we’ve completely eliminated all the paper forms we used to use internally. We still have a few left that we have to file with the government, and we’re working with them to be able to accept digital forms as well. In some cases the paper form system and the digital system will coexist for a while, but eventually the digital will take over.

Another question is: do you use technology to streamline routine tasks for administrators? And when it comes to something like placing an order to buy something, can you get all the information about the necessary criteria and how that’s going to be tracked, how it relates to the budget? Well, it’s very straightforward through some of these Internet applications that can be built.

The best practices here really come out of the commercial world, but the effort required to build these applications has now been brought down to where it makes sense for everybody to get involved with it.

There’s probably a metric related to use of e-mail that’s worth keeping track of. In a business it’s very typical for people to send and receive 40 or 50 messages a day. That really says that e-mail is the center of the things that they’re doing. I’m talking about e-mail between teachers, not only in the same school, not only in the same state, but teachers anywhere who have common interests. The ability to sign up to a discussion group and see what the new ideas are allows you to join more communities, to be more involved in things that you’re interested in, and care about. And e-mail is really the starting point of all of that.

E-mail is one system that has to be done, or is most efficient if done, at the district or state level. If every school has to build up its own e-mail system, it’s own directory and to manage that, it tends to be very inefficient. And so unlike a lot of things, such as curriculum or experimentation where you can say during this phase it’s great for it to be very bottom-up, with e-mail you really do have to take the leadership initiative and drive that top down, you know, picking an e-mail system and saying to people that, yes, the infrastructure is there, and it’s available for them to use.

This has been a huge effort for us, working with districts to implement our mail system, which is called Exchange, because now it can be set up so that you can have any type of computer connected up to it; you don’t have to use just Windows machines. Any machine can interact with it.

Part of this is, of course, getting teachers involved. And you can look at your Website and really rate it, say, does it let the teacher or let the parent come in and see what’s being taught in any period, or does it give the parents an opportunity to know how they might volunteer to come into the classroom or help out with different activities.

It’s another case where I think that having awards for the schools that do this best will really spread the best practices very, very rapidly here.

So there are some wonderful activities taking place. It was pretty hard when we were sitting down to pick what examples we wanted to highlight to just simply pick two or three, but I thought it would be worth showing you some that we are very excited about, and so let’s take a look at some of the activities in three different school areas.

(Video shown.)

I thought it was important to include an international example, because there are a lot of countries that are doing very exciting things with technology in the classroom, countries like Australia, Israel, Costa Rica. They’ve allocated a lot of resources, and because they see how the U.S. is using technology to create a strong economy, they’ve made it a priority.

Well, Microsoft’s role here is to keep providing the software building-blocks that make these systems inexpensive, but increasingly powerful. The standards we’ve created around the PC have created that competition that’s constantly bringing the prices of that hardware down, and creating machines that are more effective in the learning environment.

We do have a very special focus on education. We built a group we call our Educational Customer Unit, which is dedicated to how software can help out in the education environment. We have a lot of partnerships where we’re getting feedback on how to evolve the product. We’re very involved in professional development with some institutes. And the impact of those we think has been great. We’re just at the beginning. We want to do a lot more, but already indirectly over a million teachers have been trained, and are gaining a comfort level with getting aggressive to bring technology into their classrooms.

Again, I’d highlight the information that’s out on the Web that can really track for you good examples of people who are in the same situation you’re in and what they’ve been able to do. We’ve got over 400,000 people coming to our educational pages every month, which makes it one of the more popular parts of our Website. And we also have the ability to get feedback there on things that people would like to see more of, and so we’re constantly refining it to fit in with the interests that you have.

Our products, I think, are well-known, and I don’t want to dwell on those. I just want to make clear that these are the building blocks that go into these systems. Microsoft Office, which is a tool that kids will be using in the work force to build documents and manage information; the fact that they can get some familiarity with that at a young age, they just take it for granted, and they do things with it that we wouldn’t have expected.

When it comes to building large networks and getting all these systems to work together, that’s been a big challenge. And fortunately the corporate environment is trying to do exactly the same thing, and so the priorities that we have in terms of reducing cost of ownership, making it easy to keep the software up to date, your school networks will benefit from all those activities in parallel.

Across all these products we have a number of key initiatives: reducing the complexity, having fewer commands, making it so that if there’s an error that comes up, the system can do self-diagnosis instead of forcing the user to be so knowledgeable about the inner workings. That’s really the most exciting area for us right now, and the progress we’re going to be able to make is amazing.

In scalability we’ve now got it so that these very inexpensive PC servers have the power that the mainframe used to have, and so even your most demanding applications can run on very low-cost hardware.

The initiative I want to focus on today though is interoperability, because we’ve made a breakthrough in terms of how school information will be handled in the future. Interoperability is very important. You don’t want all the different systems to be islands. You can end up with inconsistent information, the inability to really track what’s going on, and reporting becomes almost impossible. And in the school environment you can pick a lot of places where you get islands: food systems, administration, library, instruction. And the firms that build the applications are different firms. I think that’s great, you know, that people are specializing in those different areas. So you don’t want to turn to a single vendor for all those software applications. But you’d like the data to flow automatically between these things.

Well, that’s exactly the problem that we’ve set out to solve. And so we’ve created a schools interoperability framework. This is the first time that anybody has tried to do this, and the reception we’ve had from the software developers has been really fantastic. What the schools interoperability framework does is define a standard way of describing the student, describing the classes they’re enrolled in or results they’re achieving, any financial aid data. All of that is kept in a standard way so the various applications can see that data and work together to update it. There will be compliance tests to make sure that people who say they support this framework really do, so that people get the full benefit.

We’ve set up a Website for all the people interested in this to join in the meetings and join in the definition. The specification is nearly complete. In fact, all the key pieces have been put together and we’ve actually got software developers who have built their applications to support it already.

We’re getting really unanimous support from the vendors. When we’ve gone out to them to talk about this, they’re saying, "Gee, somebody needed to do this." You know, it’s something that will make a huge difference. And so you’ll see all the key vendors signed up here, and they’ll be committing to very concrete plans over the next year to get this support into their software. And so you won’t have to change the software package, you may have to get an update to it, but the benefits will come without any real dislocation.

The framework not only ties together various applications, it also makes it possible at the district, state or any other level to take the information and bring it together so you can do measurements and analysis. So it doesn’t matter that within, say, a state you may have many different instructional systems or many different grading systems or many different attendance management systems; as long as those systems support this framework, you can gather all the information and see it in one place and do immediate analysis.

And so it really is a fundamental change in terms of how you’re going to think about your access to data. You won’t think of those applications as just holding their data, and that you have to learn some special method to navigate that data. Rather, the views that you want will be available to you up to date through something like an Excel spreadsheet, where you can navigate around and anything you find that’s of interest you can create a little piece of e-mail, include that rich view and send it off to your colleague. And so understanding will be far, far easier than it is today.

Well, the way to really see how concrete this is, is to see it in action. I’d like to ask Toby Richards from our Educational Customer Unit to come on out and give us a look at this. Toby has worked with some of the key software vendors, and they’re here to show us how the framework’s working in their software.

Hi, Toby.

TOBY RICHARDS: Hi, how’s it going? Thanks for inviting us.

We’re really excited about the Schools Interoperability Framework Initiative. It’s going to solve a lot of the interoperability initiatives that you talk about. In addition, we’re going to demonstrate some capabilities that the framework actually offers once these applications are starting to share data amongst one another.

Let me set up the scenario. This is our proof of concept demonstration for everybody here. We’ve got four vendors here today who represent different types of applications, that today in a school or a district sit alone as isolated types of applications, and we’re going to use the technologies around the schools’ interoperability framework to show how data can pass back and forth between each of these applications.

We are going to start with our student information systems, and that is represented by National Computer Systems. And this is the application where student records would be held: name, address, grade information, that sort of thing. And the scenario is it’s a day - maybe the first day of school - and we’ve entered in 50 students into the school today. And so now what’s going to happen is the student information system that’s connected up to the school’s interoperability framework is going to basically tell all the other applications "We’ve got new information in here; it’s time to update."

And so we’re then going to then go to the food services application, represented by Snap Systems, and you’ll see here on the screen some students that are already entered into that application, and you’ll see the 50 new students actually entered into the food services application.

So within probably less than 30 seconds those 50 students were actually entered into this application. Today, it probably would have been done in two ways: One is the paper form that you talked about, where the registrar entered in the information and maybe that paper form was actually copied, handed off to a cafeteria manager or somebody who actually physically entered in that data, and you know what type of inaccuracies that could potentially cause. That could also be done in maybe a laborious batch process type of way that may not be in real time like we’ve just demonstrated here.

One of the things we’re going to do is we are going to select a student, Andrew Jackson, and we are actually going to print out a meal card for Andrew. We actually have the meal card right here, and this is just printed out using just a color printer.

And we’re now going to go to the library. We’ve been enrolled and we’ve had a meal. We’re going to go to the library and we’re actually going to check out a book. Well, the first thing that has to happen is the library system actually has to connect to the school’s interoperability framework and make sure that its information is current. The library application is represented by Follett Software today, and so what you can see here is the same ten students that were originally enrolled in that system, and we update that, and again the 50 students appear right there.

Okay, so automatically they’re all entered in, up to date in those three applications.

So now we’ve got a card. On the card we’ve got a bar code, we’ve got a student ID number, which is the same number in the NCS system, in the Snap System, the cafeteria management system and in the Follett Software library system, and we’re going to use this card to check out a book.

So we’ve got a library scanner here and I’ll let you go ahead and scan this card. And so you can see that Andrew’s name has now appeared on the software. And we also have the book that Andrew’s going to check out, "The Hitchhiker’s Guide to the Galaxy." Key for homework. And you can see that the book is automatically entered into the Follett Software library automation package.

So we have enrolled students, we have followed one student through the food services application, we’ve gone to the library, we’ve checked out a book, all in less than about two, maybe three minutes, and I think it’s pretty safe to say that is a great improvement on today’s typical scenario.

We’ve laid the foundation of our digital nervous system here. And so let’s do a little bit more with it. We’ve got data and information flowing between these applications. We’re actually now going to do something with that information. And so we are going to switch to our reporting computer. And we’ve got two types of reports. The first one I’m going to show you is using a Web browser. And the scenario here is I am an administrator within a school office, maybe a district office, and I want to see some basic overview information on a particular student. So I’m going to double click on Andrew Jackson’s name, and what is happening here is that the Web page is actually pulling in information in real time from the NCS application, the Follett Software application and the Snap Systems information into one consolidated view on the Web page. This can be secure so there’s no issues there in terms of privacy and that sort of thing, but again we’re seeing just an overview of the different applications.

And again, these are just the scenarios we’ve picked for today. This could be a transportation system that says what bus route a student is on. This could be a finance application, an instruction application, any type of application that is conforming to the specifications around the school’s interoperability framework.

Now that’s just a static view of information. Let’s also go in and actually do something with this. This is using Microsoft Excel, which is a data analysis tool, that would put the power of the information into the hands of some decision-makers who actually want to do some analysis. What we’re seeing here is just a small overview of some student activity. I could go in again using Excel and actually show that in a chart or table format and compare student activity graphically.

And again this is real-time data pulling in to the Excel spreadsheet. I can also maybe go in and actually filter out some names so that I can actually do some comparison of particular students, you know, a smaller group. And again, you can do any type of analysis you want to do, if you know how to use these simple tools.

BILL GATES: Now, would that be information from just one application you see there?

TOBY RICHARDS: No, we had pulled in some grade information and some discipline, demerit type information from the student information system. We can pull in the food service report. An example we’ve shown in the past is how meal activity actually affects grade activity in the school, which certainly is a big issue today with subsidies and how funding happens today in schools. So the application’s pulling in information from a variety of systems all into one place, all in real time.

Okay. So we’ve made the information available to our decision-makers within schools. Let’s now get the parents involved. We are represented by PhoneMaster, which has a package of interactive voice response technology that will allow parents to take advantage of the information that the school’s interoperability framework is actually providing to us and actually get overview information just using technology that we’re used to today, and that’s the telephone.

And so what I’m going to do is dial in to our school network, and you should be able to hear that.

(Phone dialing.)

COMPUTER VOICE: Please enter the selected student. Student status report: Test information: The selected student took the Iowa Standard Test and scored 87 on February 9, 1999. Meals information: The selected student’s cash balance is three dollars and twenty-five cents.

TOBY RICHARDS: So, again, this shows how these applications are sharing information with each other, and actually extending that out into the community. And, again, these are just examples. The idea around the framework is to be flexible, for schools and districts to actually customize the functionality to meet the interests of their communities.

So we’ve done three things: We’ve saved a lot of time in terms of entering data into a variety of systems. We’ve added a level of integrity to our information system. Data is accurate. Data is being sent to other applications in real time. It’s all up to date. And the last thing is we are extending our investments in information technology out to the decision-makers within the schools and also to the community. We’re really excited about the schools interoperability framework, we have a lot of support, as we’ve showed. We’ve made a lot of progress. We still have a lot of progress to make, but we’re very excited to solve some key issues in education today.

BILL GATES: That’s a real breakthrough, and it’s great to see it working. I think that’s a great demonstration of the power of standards. Bringing all the vendors together and having one common approach really can have fantastic benefits.

Well, let’s look a little further out into the future and think about what will these systems be like. The rate of innovation is not slowing down. The cost of computers will continue to go down, but the very way that we interact with them will be changing. They won’t just be cheaper and faster. There’ll be things like a tablet device. We’ve made a breakthrough that allows you to have text on a flat screen, an LCD type device, actually be readable. Today you wouldn’t want to read a book off of the screen, because the text just isn’t good enough. But with this improvement we’ve made, called ClearType, we’ll have a form factor that you just carry around with you, will connect up to a wireless network, and always have the latest information. So you can take it into the classroom, take it to a meeting, read things, and it will recognize the handwriting that you do on it. And so that will let people use digital information more seamlessly than ever before.

We’ll also have pocket-sized devices that will connect up to the same wireless network, so seeing your messages and your schedule, all of that will get to be very inexpensive.

Now, Microsoft is spending about $3 billion a year on R&D to develop the software for speech recognition, better voice synthesis, and making the computer far more adaptable and less ponderous for people to use. And so these are ways of interacting in a natural fashion.

And this is going to help drive use of the PC from where it is today to even broader usage. Today about 50 percent of the households in America have a PC. That jumps up to about 65 percent if you just take households where there are kids present. So there is a positive correlation there, where parents are really making an effort to get the PC in there.

But we want to get it to even higher numbers, and I think ease of use is as much of a barrier there as is the cost that’s involved.

The opportunity with this kind of a natural interface is really pretty incredible. We’ve already seen this, as we’ve used it a little bit in our products. We’ve got speech synthesis in our encyclopedia. In Japan, where it’s very difficult to use the keyboard, because of the huge alphabet they have, handwriting recognition software is already built in and very, very popular. Likewise, in our Office product, we have grammar understanding that can parse a sentence, and that’s a key element in the speech recognition.

Even something you might not expect, such as having the computer see, will be a standard feature. As you walk up to a computer, it will be able to tell who’s there. It will be able to see whether they’re reacting positively or negatively to what’s going on. And you’ll be able to use gestures to command the computer to do various things. And so you get very natural interaction.

It’s all the magic of having that incredibly high-speed processor and rich software running on top of it, all running the standards that we’ve created around the PC. So the tools will get better and better, and they will provide some incredible things.

But even looking ahead, the computer won’t be anything more than a tool. It’s up to you to decide how you want to use it. It’s up to you to decide how you involve the teachers. It’s up to you to think through the administrative systems you have and have those be better at tracking what’s working and what’s not working. That’s being smart about your digital nervous system. And certainly we would like to work with you to see where we can help, where we can share examples and ensure that your implementation goes smoothly.

There are lots of opportunities to share best practices, and I hope you’ve gotten a sense of how enthusiastic I am about education, and how optimistic I am about these opportunities.

Thank you.

(Applause.)

MODERATOR: Ladies and Gentlemen, AASA has developed a brand-new, major award known as the Galaxy Award. The Galaxy Award recipients will be individuals whose vision of the future is such that it changes the way we live, and individuals who also lead us into that new future. It is with a great deal of pleasure that we announce that the first recipient of the AA Galaxy Award is the Chairman of Microsoft Corporation, Mr. Bill Gates.

(Applause.)

Not only is Mr. Gates a visionary who has obviously made a significant impact in our lives, the way we work, the way we learn, the way our children will learn into the future, but also his personal generosity and philanthropy have changed the way that many men, women and children live. So on that basis, again, we are very pleased to recognize you as our first award recipient. Thank you very much.

BILL GATES: Thank you.

(Applause.)

MODERATOR: Mr. Gates has been kind enough to agree to answer some very short, quick questions in the time frame that we have left. So, yes, why don’t we start with you, ma’am. Go ahead.

Q: First of all, a special thank you to you, Mr. Gates, for joining the public educators of the country today. You’re in a particularly unique position to be thinking about what skills our students of today will need in the technologically changing workplace. Could you talk to us a bit about what you see, based on your perception of how the workplace is changing, what skills are our students going to need?

BILL GATES: Well, the rate of change in business will continue to accelerate, and so the specific skills that people need are fundamentally to be able to use tools, to be able to think, to be able to work in groups. There are a few basic things like, you know, comfort with a computer and browsing the Internet, word processing and spreadsheets that will be a foundation. But the sort of collaboration and confidence and willingness to test ideas, that’s going to be more important than ever because the jobs of the future won’t be the simple jobs of the past. All the jobs that have been clerical in nature, where you just take information from one place and move it to another place, those will go away. Now, fortunately, they’ll be replaced by jobs where you get to really be involved in helping a customer, really helping to plan some activities, And so the general skill set, the problem-solving skill set that we’ve always talked about, that rises to the top even more than before.

MODERATOR: Thank you. Next question. Yes, sir?

Q: With the focus on the digital nervous system, is there thought towards linking with educational publishers to, number one, convince them that they should put all their curricular products at a Website or various Websites; number two, show them how to protect their products so that every time we hit that particular site we actually pay and hopefully much less than what we pay for textbooks today; and if one and two occur, number three, can you show them how to take the now rather staid text and turn it into an exciting hot-linked product that will just sweep off the pages or our systems?

BILL GATES: Well, I agree with all those points. We’ve created a standard for electronic books, drawing on Internet standards. The key extension that we’ve made in designing that is the intellectual property protection, where if somebody who publishes wants to track usage in different ways, then they’ll be able to do that.

One of the things that having this all in digital form will do is it will democratize the involvement in creating text materials. And in many cases it will be the students or teachers using tools like our Front Page to actually create some of that material themselves. And if you get it up there on Websites and make it easy for people to find and give the right rewards, part of the mix will be material that comes out of the educational community itself. I think that will have a positive effect on the textbook world, because they’ll see that they have to move up to a new level in terms of the enrichment and engagement that they create. And if they’re going to have something that people are willing to pay for, it will have to be beyond what individuals can create.

And so the ability to tailor that textbook, the ability to get it at lower cost, the ability to have it be very, very up to date; all of those things are greatly facilitated here. And I’d say the critical-path item is getting the inexpensive screen devices done so that we can drive this to critical mass. But within the next five to ten years all of that will come to pass.

MODERATOR: Thank you. Next question.

Q: Mr. Gates, I bring you greetings and thank you from a friend of mine, who was your sixth grade teacher at elementary school, Ms. Catty.

BILL GATES: Well, that’s very nice.

Q: She’s told me special stories about you. (Laughter.) And most recently when I was talking with her, she was complaining about all the money she was having to pay to the government, and the reason was she sold some of the stock that she bought, Microsoft stock. She thanks you. She’s now a millionaire. (Laughter.)

BILL GATES: Well, that’s great. (Applause.)

Q: Mr. Gates, we thank you again for being here. I have two quick questions. Number one, in terms of bringing equity, access to information through the computers, how can you help us influence a Congress that I don’t think is really aware of the potential and the need that we have to equalize the playing field across this nation for young people to have access to information? And the second question, a little less serious, when you get your membership to the Augusta National, could you include me in a foursome one day?

BILL GATES: Well, we’ll see. (Laughter.) In terms of the resources here, it’s a very tough problem, because there’s a lot of priority, you know, and technology is not the only priority. There has been good news in that a lot of special levies that have been focused on technology have gotten voter support. So if you package it up the right way, you can often get people saying, "Yes, this is a good investment in the future; this is something that we’d like to do." And so hopefully that will spread.

I doubt that the biggest change will come from the federal level. You know, I think a lot of this has got to be district by district, state by state, where it builds up and you can see the results that the people who have really made the investments are getting there.

I also think we’re in this period where we’re learning about how things are done, so the fact that it’s going to take a period of years to get all the machines and the connections out there, it’s not the end of the world, as long as we use this time period to really pry out the different approaches, and really highlight the people who are doing it well, and be willing to be a little more measurement oriented than maybe we have been in the past to see what really makes a difference.

So, certainly, I believe that additional resources should be provided. I’ve done a lot with libraries - it seems like a very simple thing to say that anybody who can get to a library can get to a state-of-the-art PC and the Internet. And, you know, I’m also looking at some things to help schools as well. So I think we can all pitch in and get the word out that the investments, if they’re handled right, are worth doing.

MODERATOR: One final question. Yes, sir?

Q: Like many districts, our district’s in the process of putting the infrastructure in to bring us into the digital community. Is Microsoft working on a package - I feel like we’re reinventing the wheel in all these districts - a package that would be just educational specific?

BILL GATES: Well, we actually provide at no cost on our Website a lot of templates, the templates that you’d want to use to put up Websites for a particular class, templates for the school itself, a template for your extracurricular activities, how you can set up the schedules and make them appear in a pretty rich way. And the basic software, the Windows NT and Exchange Mail software, we’ve configured those to fit the needs of schools; for example, where you have a mix of machines, including older machines, or you have unique administrative needs where you want to delegate to students the ability to do some things, but not all things. And so I think we are putting the right pieces together and we’d love to talk to you about how you’re doing that.

Q: Thank you.

MODERATOR: Well, ladies and gentlemen, recipients of our Galaxy Award, certainly a gentleman who has impacted our lives tremendously, Mr. Gates, thank you so much for joining us on behalf of AASA.

BILL GATES: Thank you.

(Applause.)