The free service will enable users to find all of the material stored on their home computers using any internet link. "We have an aggressive plan to roll this out," Gates said.

On Tuesday, the search and navigation service Netscape Communications Corp announced another step into E-commerce with the expansion of the Netscape Store to offer a broad range of software in addition to its own brand. Another online shopping announcement came from the search engine Inktomi Corp, which said it had entered agreements with 300 online merchants to work with it on its new Shopping Engine, which is being launchedlater this year.

Gates also said the next version of its Windows NT operating system, for use on corporate networks, would automatically replicate PC files on a network server and make it easier to distribute software updates to all the PCs linked to the network.

The Microsoft chairman declined to comment on the anti-trust suit brought against the company by the Department of Justice but said the success of its Windows operating system was in part due to the company's vigilance in tracking competition.

Netscape says it believes it too can leverage its popular content and navigation services to build a major shopping destination on the Internet. "Netscape was among the Internet's first online retailers and a pioneer in the distribution of software online, so expanding our software Store is a clear next step," said Maria Wilhelm, senior vice president of consumer programming for Netcenter.

"We have to redefine the way people think about computer operating systems so they don't even consider Windows tobe in the same category as competitors," Gates said. "That is our job."

Gates also said he was convinced competitors would gain a critical advantage over Microsoft if the Redmond, Washington-based company did not move fast enough. "The culture of our company is never to dismiss these things that are coming along," he said. "We were one of those things that came along."