Bill Gates is willing to pay a lot for engineering talent.
Asked what makes Yahoo worth more than $40 billion, Gates pointed not to the company's products, its huge base of advertisers, or its market share, but rather to the company's engineers. Those people, he said, are what Microsoft needs to go after Google.
In an interview after his speech at Stanford University, Gates said that it turns out it takes a lot of manpower to build tools for advertisers, mobile, and video products as well as improving its core search algorithm and building an infrastructure for cloud computing. "The amount of computer science it is taking to do that is phenomenal," he said. "As you get more scale of engineering you can just pursue that agenda more rapidly. Yes, the advertisers and the number of end users is good, but we'd put the people and the engineering as the key thing."
Bill Gates, Microsoft, Yahoo!, Google