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asp The short, tormented life of computer genius Phil Katz By Lee Hawkins Jr. of the Journal Sentinel staff Last Updated: May 20, 2000 Then he was found dead April 14, Phil Katz was slumped against a nightstand in a south side hotel, cradling an empty bottle of peppermint schnapps. The genius who built a multimillion-dollar software company known worldwide for its pioneering "zip" files had died of acute pancreatic bleeding caused by chronic alcoholism. He was alone, estranged long ago from his family and a virtual stranger to employees of his own company, PKWare Inc. It was an ignominious end for a man who created one of the most influential pieces of software in the world - PKZip - and it attracted the attention not only of the techno-faithful but of the mainstream press across the nation. Katz's inventions shrink computer files 50% to 70% to conserve precious space on hard disks. His compression software helped set a standard so widespread that "zipping" - compressing a file - became a part of the lexicon of PC users worldwide. But the riches his genius produced were no balm for what had become a hellish life of paranoia, booze and strip clubs. Toward the end, Katz worked only sporadically, firing up his computer late at night, while filling his days with prodigious bouts of drinking and trysts with exotic dancers. Katz owned a condominium in Mequon but rarely stayed there. Desperate to avoid warrants for his arrest, he bounced between cheap hotels near the airport. I mean, a true friend," says Chastity Fischer, an exotic dancer who often spent time with Katz and was one of the last people to see him alive. High School Outcast Phil Katz was a quiet, asthmatic child whose athletic pursuits as a kid went no further than riding dirt bikes in his Glendale neighborhood. A 1980 graduate of Nicolet High School, Katz was a "geek" long before that term was linked with dot-com companies and piles of money. "He was an outcast, definitely someone who was picked on," says Rick Mayer, who graduated with Katz. He was short, and, well I don't want to say homely, so I'll say he was plain looking." After hearing of Katz's death, Ray Fedderly, a Milwaukee cardiologist who sat next to Katz in high school honors math and physics classes, opened his high school yearbook and found an angst-ridden message. "I enjoyed working with you in mathematics and physics classes through the four terrible, long, unbearable, tortuous, but wonderful years at Nicolet," Katz wrote. "I hope your future is bright and your life is happy (if possible). "If I were a physician as I am now when I was 18, I would have known what to do with that note," Fedderly says. A loner by nature, Katz gravitated to analytical pursuits. Katz and his father, Walter, spent weekend afternoons playing chess and evenings writing code for programmable calculators in the days before PCs forever changed computing. Since programmable calculators had very little memory, Phil and Walter had to work very efficiently. "The earliest program I remember him writing was a game program that dealt with landing on the moon," says Brian Kiehnau, Katz's former brother-in-law who met him in 1977. "It was very crude and simple, but it was complex for what he had in terms of hardware. He got real good at optimizing programs, and he learned to get the job done with the least amount of instructions and running times." In 1980, Katz entered the computer science program at the University of Wisconsin-Milwaukee. Around the same time, Walter and Hildegard Katz bought Phil his first computer, an original IBM PC. It had two floppy drives, a monochrome monitor and 64K of memory, an astoundingly small amount compared with today's machines. Once he got the PC, Katz started writing programs, spending most of his free time on electronic bulletin board services, the precursors of the Internet. The services quickly became Katz's social circle, a place where he hooked up with others who understood his sophisticated programming techniques and shared his passion for computers. Gradually, Katz developed a fondness for sharing information on the services, since interacting with others helped make his programs better. Those experiences would influence Katz to embrace the "shareware" approach to distributing PKWare's software. With shareware, users try a product, and if they find it valuable, pay the person who created it. In the case of PKWare, users paid $47 and received a manual and free upgrades. "He spent many, many hours talking to people and helping people. He would go to computer user groups and spend hours with them," Hildegard Katz says. But in the spring of 1981, tragedy overtook the family, and things would never be the same for Phil Katz. Walter, 55, plagued by recurring chest pains, underwent open heart surgery. Years later, in the haze of his drinking binges, Katz told Fischer how the loss had affected him. "He'd always say that when his father was alive they'd go fishing and do man things." Walter's death drove his son further into solitude and deeper into a one-on-one relationship with his computer, say friends and family members. Writing Programs at Night Katz graduated with a computer science degree in 1984 and was hired as a programmer for Allen-Bradley Co. He wrote code to run "programmable logic controllers," which operate manufacturing equipment on shop floors worldwide for Allen-Bradley's customers. Katz left Allen-Bradley in 1986 to work for Graysoft, a Milwaukee-based software company. He spent evenings holed up in his bedroom writing his own programs. His project: An alternative to Arc, the then-common program for compressing files. Using algorithms, Katz wrote programs that imploded information by telling it, for example, to take every "a-n-d" out of text. A good program takes out these and thousands of other combinations of letters and restores them when needed. Katz bounced early versions of the software, called PKArc, off his buddies on the bulletin boards and spent countless hours refining it. By 1987, the software had created such a buzz online that PKArc started to steal market share from Arc's creator, System Enhancement Associates of New Jersey. "Then over the next few months, I got more checks in the mail." "People kept calling him saying, 'We would like to use your software, and we want to pay you money for it,' " Hildegard says. PKArc's sales dwarfed his Graysoft salary, which was in the low-$30,000 range, says Steve Burg, a former Graysoft programmer who joined PKWare in 1988. In the beginning, Katz did most of his work at Hildegard's kitchen table. They hired an answering service to handle the flood of phone calls, and offered Burg a job as a developer. "He was extremely intelligent," says Doug Hay, who joined the company in 1988 and stayed until June of last year. "He had all the equations from exams memorized from 10 years earlier, things you generally forget 20 minutes after the test." System Enhancement sued PKWare in 1988 for copyright and trademark infringement. In 1989, as his legal costs mounted, Katz agreed to settle. Full terms of the settlement were not disclosed, but representatives of the New Jersey company may have been surprised when they finally met their nemesis. "The lawyer for System Enhancement showed up at Hildegard's house expecting a big company," Kiehnau says. "He had an address from the bulletin boards, so he thought there would be a big glass building or something. arc as PKWare introduced new, incompatible archival tools with better compression algorithms. "Phil became a very wealthy man in a very short period of time," Burg says. While Hildegard worked to keep business matters in check, Katz devoted nearly all his time to programming. He didn't come to work until late afternoon and worked well into the night, so he could have complete silence and not have to interact with anybody, early PKWare employees say. "If the business would have went belly up two years after it started, I don't think he would have cared." But Katz's unpredictable schedule frustrated his family. During his frequent absences, Katz kept in touch with Hildegard and PKWare executives through electron...
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