Lot of people understood it was going to be massive. But they understood it as “doing X on the internet”. Just like everyone was making “Uber for X” three years ago.
Yahoo was yellow pages on the web.
Viaweb was shopping. Broadcast was radio. All X on the web.

At the time, most web sites were official company sites (basically HTML ads). A few news sites (Bloomberg was an early one). Some research labs and universities.

When we started IIS, there were maybe 3 million internet-connected users worldwide, and the web server we were running couldn’t handle the traffic coming to Microsoft’s web site - that would be single digit QPS.

Bill not only comes in and says “video calling”. But also free, worldwide, and on a PDA. Making a video ad showcasing the concept back then would have cost more than building the product itself today. Everyone can predict the future, very few can predict the future with an error of +/- 5 years. Nobody will bet a company richer than god on it.

Some of my ex-Apple colleagues used to “joke” that Bill’s gift was to see a piece of technology, and hit the fast forward button, and Steve (Jobs)’s gift was to see the future and hit rewind to the present day. Both hit the button too hard at times (Apple Newton, Lisa, IIS, WebTV).

Bill saw the internet, and knew it was the platform of the future a week later. The OS didn’t matter, the chipmaker didn’t matter, the form factor didn’t matter. It was all about content and services at the edge.

Unfortunately for Microsoft - and fortunately for other companies - cannibalizing Windows wasn’t on the menu. It didn’t matter what Bill thought. There was the board, shareholders, Steve, Dave. Even rank and file employees would not be receptive - someone on every team was vesting enough stock to become a millionaire each week, why would you talk about changing course? It’s really true that after a certain size, your maneuverability is severely restricted. So they doubled down into trying to make Windows + IE the internet, and nearly succeeded.

Two things had to happen before others saw the same things Bill did. Javascript running in the browser (1997), and Google figuring out hardware didn’t matter on the server side (2000). Java was a token threat. Bill knew it would not be performant enough on clients for Applets to succeed. They had to rebuild their language to put every fixed-size object on the stack because sorting an array<int> on a typical machine took forever. That’s why Java still doesn’t have operator overloading. That Java battle would be on the server, and we didn’t have a good language to bring to the battle there. Wired and co loved to paint a picture of Microsoft v Java as Goliath v David. Not true - Java was a speedbump.

The real threat was dumb terminals (aka web browsers). Even today, the world could run on Mac OS / iOS and Safari. If Microsoft was okay with sacrificing Windows market share and instead controlled content and services, they would be much more valuable. OS wars ended in 1995 - I think we had prototype of Excel running inside IE by 1999. It wasn’t very usable, but was maybe 3 years of clock speed improvements away. Wait for 3 years and you have an incredible product. Nope - some people decided to pour more resources to tying IE to Windows. Idiotic strategy when a web browser at the time would be a two-week project since every OS kernel shipped networking primitives by now. Rendering HTML/XML was trivial.

Once the DOJ walked into Microsoft, it was all walking on eggshells from then on. More people saw the vision, but were too scared to act.