"Software is the place where the action is ... it is an area that will continue to generate jobs. This is the golden age of software." With declarations like these, it is no wonder that Bill Gates yesterday held an audience of students spellbound at the University of Waterloo.

He was addressing just a few hundred students from the math, computer, and engineering faculties at the southern Ontario university, and they watched rapt as Gates, who was on a three-day tour of six university campuses in North America, foretold of a shortage of great software engineers in the coming decade. (Microsoft hires up to 50 students a year from the University of Waterloo alone, of the 1,000 new hires a year that it makes.)

"Microsoft has had a long relationship with the University of Waterloo going back to the very early years of the company," said University President David Johnston. "They are particularly attracted to the very high quality of computer science, math, computer and electrical engineering students that come from the university."

Among the things Gates said he doesn't expect to see in the future were "physical media" like CDs and DVDs. Music and movies would all be delivered on-line before long, he said.

According to Canadian TV reports, Gates calls this "the golden age of software," and predicts that there will be "more advancements in the next 10 years than there have been in the last 30."