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Despite the similarities, Mr. Gates is approaching philanthropy in a fundamentally different way — call it Philanthropy 2.0. Just as Carnegie and Rockefeller were influenced by the vertically integrated, industrial economy they helped to create, Mr. Gates's philanthropic efforts are defined and affected by the less hierarchical, networked economy that he helped to create. With its small staff, strategy of creating partnerships and focus on research and development, the Bill and Melinda Gates Foundation more closely resembles a 21st-century software company than a 20th-century philanthropy.

"It's a conscious attempt to create a different style of foundation, a strategy of intervention and networks," said Lester M. Salamon, director of the Center for Civil Society Studies at Johns Hopkins University.

Carnegie and Rockefeller were pioneers in bricks-and-mortar philanthropy. After Carnegie sold his steel company to J. P. Morgan in 1901, he plowed his nine-figure fortune into limestone. He built the Carnegie Institute in Pittsburgh and the Carnegie Institution in Washington and seeded the nation with more than 2,800 libraries. "His focus was to uplift humanity, and libraries for him were the best way to reach the broadest spectrum of the people," said Peter Krass, author of "Carnegie."

Libraries have also been a centerpiece of the Gates Foundation's work. But instead of building them, Mr. Gates is wiring them. Working with private-sector partners like Microsoft and Gateway, the Gates Foundation has helped provide computers and technology to 11,000 libraries.

John D. Rockefeller created educational institutions from scratch, building both the University of Chicago and Rockefeller University in New York — the first major institution devoted purely to medical research. But Mr. Gates has a taken different approach to education reform. "The Gates Foundation isn't building schools," said Peter J. Frumkin, professor of public affairs of the Lyndon B. Johnson School of Public Affairs at the University of Texas and author of the forthcoming book "Strategic Giving: The Art and Science of Philanthropy."

"They're giving money to school systems and telling them to restructure, to reduce the size of their schools," Professor Frumkin said.

The Gates Foundation has given more than $100 million to New York City's public school system alone, to encourage the creation of smaller schools within existing school buildings. The foundation says its programs currently touch about 8 percent of the nation's public high schools.

THE networked approach to philanthropy recognizes that it's hard to make a huge impact on your own, no matter how much money you have. The Gates Foundation gave out $1.3 billion in 2005. With Mr. Buffett's pledges, it will be able to double its philanthropic output, to about $3 billion a year.

That sure sounds like a lot. But it represents only about 1 percent of annual charitable giving in the United States — which was $260.3 billion in 2005, according to Richard T. Jolly, chairman of Giving USA, based in Glenview, Ill. The Gates Foundation has $30 billion in total assets; the National Institutes of Health has an annual budget of $28.6 billion.

So philanthropists who want to make a difference today must find strategic partners. Thanks in part to the process that Carnegie and Rockefeller helped to institutionalize, there's a huge base of like-minded organizations for the Gates Foundation to tap into.
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Giving It Away, Then and Now - New York Times