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CUPERTINO, CALIF. -- Bill Gates, Microsoft's chief software architect and co-founder, preached an upbeat vision of technology in a keynote speech here Friday evening.

Speaking at the Indian Institute of Technology's 50th Anniversary Celebration gathering, Gates said people within this decade will be doing more things digitally.

"The vision that we have is the digital decade," Gates said.

In the year 2000 the number of people who used digital approaches was quite small, with tasks such as dealing with photos, taking notes, and organizing music all being done without computer technology, Gates said.

"Most things were not done on a digital basis. Our belief is by the end of this decade, that will change," Gates said.

He showed a watch that can provide sports scores and weather reports in addition to telling time, as an example of where technology is headed. Handwriting and speech technologies will be taken for granted as well, Gates said.

Web services, featuring a set of standard system integration protocols, will boost intersystem communication, Gates said. "We see [Web services] not only as a foundation of e-commerce, but also solving the manageability [issue]," said Gates.

The digital infrastructure also will need more reliability and better ways to verify identities than the use of passwords, he said.

"It's simply not an adequate way to authenticate people," Gates said. "We'll need to move up to smart cards or biometrics."

Other problems, such as lack of broadband networking, also will need to be addressed, Gates said. Wireless advancements will assist with providing broadband, he said.

Gates reflected on his initial vision of an ideal PC, one he said has not yet been fulfilled.

"I think I am still dreaming of that PC that works very, very well someday, and I'll use a new Microsoft product and I won't be sending mail out to all the developers saying, 'Why did you do this?'"

The desire to fulfill his original vision for the PC is what keeps him from retiring, Gates said.

"If you take a big enough vision, you never run out of, in your lifetime, enough work to achieve that vision," said Gates.

Gates expressed surprise at the lack of optimism in the industry.

"I'm a little bit struck [by] how many companies' or organizations' optimism is not as strong today as it should be," Gates said. Technical developments such as hard disk advancements, for example, are still moving forward, he stressed.

Responding to an audience query about the struggles facing technology startups, Gates said the period of 1998 to 2001 distorted key values important to startups.

"A startup has to be an organization that's doing something unique, something that really isn't just another Web site," he said.

He advised startups to keep costs low and meet development milestones before raising the head count of those working on a project.

"VC's and Microsoft's own internal incubation [program] have to keep things at the lowest possible costs," he said.

Asked how to reconcile software quality issues with market pressures that may prompt releases of products that are not quite ready, Gates acknowledged there is room for improvement.

"Let me say, this is an area where I'm very proud of what we've done and we need to do more," said Gates.

Developers need to work in a free-form fashion, with freedom to add components, in order to produce better products, Gates said.

Gates said he expected stronger links between the computer science and biology fields

"I think the greatest advances in the next 30 years will be computer scientists looking at biological systems," Gates said.

"Overall, I'd say I'm quite optimistic," Gates said in response to a question about challenges facing technology.

India, for its part, needs to become more diverse by adding manufacturing to its strengths in computer science, he said.

China, he said, is "just in a league of its own [in manufacturing] and no one else is paying attention," he said.

"India's going to have to get into that game," he added. By Paul Krill