Gates praises iPod, labels Zune a "modest" competitor

When we report on the sayings and sound bites of higher ups at technology companies, we tend to cover them from a negative angle because, as you well know, execs are pretty fond of belittling their opponent's products. The latest exception to this rule comes from none other than Bill Gates, who recently praised Apple's iPod, calling it "phenomenal, unbelievable, fantastic" in front of an audience at Stanford University, California. The timing of these words -- only a few days after the launch of Zune -- would be the most surprising aspect of his speech were it not for Gates' later musings on Microsoft's aim with the Zune. According to Gates, the plan with Zune is "more modest" than total domination of the portable media player market, with Gates elaborating that the company wants to "excite people about the concept" of sharing music and video wirelessly through Zune. Perhaps the company's "problems" in Europe and the lackluster reception towards the current iteration of Zune -- hence the focus on Zune's primary innovation, WiFi -- have calmed Gates, or maybe the iPod franchise has grown so huge that even its main competitors can't conceive of aiming for first place. Either way, we have a feeling that the words contained in emails exchanged between Zune HQ and Gates over the weekend won't be half as measured as those in this speech.