Though roundly ridiculed when it debuted in 1995, Microsoft Bob, or something resembling the short-lived on-screen assistant, will ultimately return, vowed Bill Gates, co-founder and chairman of Microsoft.

"You always make mistakes on these things," Gates said at the Microsoft Research Virtual Faculty Summit on Monday in Redmond, Washington. "We were just a bit ahead of our time, like most of our mistakes."

Bob, one of Microsoft's most notorious commercial failures, came up during a question-and-answer session at the summit when a researcher asked how software can be made easier to use.

Gates admitted this remains an ongoing challenge for the computer industry. "It's a research issue, to make software better. The prize when you do these things is very large in a commercial sense," Gates said.

Observing how people use products such as Microsoft Office and Bing, it is clear that most people don't know about all the functionality in products and don't have the time to learn, he said. Therefore, it's up to software companies to devise ways of making advanced features intuitive.

Gates said he sees a path forward with personal software agents, which can tie together information from different sources to deliver services more attuned to what the user may need.

This was the mission of Microsoft Bob, which was an attempt to introduce the capabilities of Windows and other Microsoft programs to end-users who had little familiarity with how software worked. An overlay on the Windows interface, Bob organized software by using cartoon images of the inside of a home, such as clickable checkbooks and address books, and provided avatars to walk users through common tasks.

"We tried a little personality that was definitely premature. I think it will re-emerge, but perhaps with a bit more sophistication," Gates said.

The promise today is that personal agents will know more about the context of the task the user is trying to complete, making them more valuable than Bob. The agents now can use online calendars, geolocation tracking, e-mail and information from many other sources to build a greater context around the user.

"I think we'll be more connected. If someone want to do a task, like find a gift of a certain type, or organize a trip in a certain way, there will be a closer match [between] what the software can do for them and what most people end up doing," Gates said. "We can look at the text and look at the speech and try to be helpful to you in your activities."

Answering a question about intellectual property (IP), Gates addressed the value of open source and commercial software and the value of the patent system.

"Thank God for commercial software. It funds salaries, gives people jobs. And thank God for free software. Free software lets people get things out there, you can play around, build on them. The two work very well in a common ecosystem," Gates said.

Gates likened this ecosystem to how pharmaceutical companies protect their IP while allowing Bill & Melinda Gates Foundation to reuse their drugs and vaccine formulas at marginal costs in impoverished nations.

Having stepped away from working at Microsoft full time in 2006, Gates focuses most of his attention on the Foundation, which attacks global problems such as poverty and inadequate health care. The Foundation has saved 10 million lives, thanks in part to its partnerships with pharmaceutical companies, which rely on patent laws to make money, Gates said.

"Thank God for patent laws that allow them to sell drugs," Gates said. "It's essentially a transfer of people buying drugs in the rich world that allow these things to be done at marginal cost."

Because the most impoverished countries don't have patent laws, "we never run into IP problems," when reusing these formulas for medicine, he said.

"It's a complex system. Anybody who thinks getting rid of [patent laws] would make a better world, I can certainly tell you that is crazy," he said.

Gates also praised the emergence of massively open online courses, or MOOCs, which he said have provided immense value for education, though much more needs to be done to bring the full education experience to people online, he said.

"We're at the beginning of something really quite profound, even though the temptation to oversimplify it is really quite great," Gates said, adding that "Teaching has many different aspects."

Many MOOCs now focus on what Gates called "the big lecture," lectures given by notable and entertaining professors, such as Walter Lewin's physics courses at the Massachusetts Institute of Technology's OpenCourseWare.

"If we think of that as the only part that goes on in learning, then we'd be missing where kids are doing problems, where they are in labs, where they are in study groups, where they would be discussing topics -- many things don't fit that big lecture format," Gates said. Social networking software can help replicate these activities at comparatively little cost, according to Gates.

"At the end of the day, a lot of education is about getting the credential that helps with your employability," Gates said. Traditionally, this has been done at a university, with the diploma showing proof of competence. A diploma offers proof of what you know, coupled with how you learned it.

"I see those things decoupling," Gates said. "The way you prove you have certain skills can be very straightforward, and there can be a lot of people competing to help you gain that knowledge."

Gates was not so optimistic when asked if he though the art of software programming has improved over the past few decades.

"Is programming today much different than 10 years ago or 20 years ago? Not really," Gates said. the challenge "to take domain knowledge and encode that in a way that is transparent, understandable, easy to update," is about as difficult as it has ever been, he said.

"I know there is work [being done] along those lines, but you could have said that 20 years ago."

Joab Jackson covers enterprise software and general technology breaking news for The IDG News Service. Follow Joab on Twitter at @Joab_Jackson. Joab's e-mail address is [email protected]