MENLO PARK — In the software business, fear and loathing of Microsoft Corp. is the order of the day.

Proprietor of the crucial DOS and Windows operating software, Microsoft is too big, too strong, too ruthless for anybody's good, critics say. Bill Gates and company, they prophesy, soon will wipe out competition in one of the world's fastest-growing and most influential industries.

Yet even Microsoft has its weaknesses, and nowhere are they more evident than in the burgeoning consumer software market. When business customers are looking for word processors or spreadsheets or database programs, they increasingly turn to Microsoft. But when they are looking for computer games or educational programs or personal finance packages, they turn elsewhere.

It is not for lack of effort on Microsoft's part. Powerful consumer software is a key element of Gates' ambitious long-term vision, which he has dubbed "information at your fingertips." Plummeting PC prices, moreover, are rapidly increasing the number of PCs in the home, making consumer software the biggest growth segment in the industry.

But a handful of nervy and capable upstarts have shown that they understand consumer software far better than the Redmond, Wash.-based behemoth. Two Bay Area companies in particular--Broderbund Software of Novato and Intuit Inc. of Menlo Park--have demonstrated that it's possible to take on the giant and prosper.

Both are small companies. Both recently went public. Both are consistent innovators who understand customer service far better than most software firms. And though both live in fear of Microsoft, they're rarely heard to complain.

Scott Cook, co-founder and chief executive of Intuit Inc., hardly ever talks about bits and bytes and bandwidth. He doesn't consider technical brilliance all that important. He doesn't even view his company, purveyor of Quicken--one of the biggest-selling software products of all time--as a software company.

He thinks it is more like his one-time employer, Procter & Gamble.

"In a consumer-driven company, the 'R' in R&D is lots of customer research," says Cook, a buoyant, personable 40-year-old who carries none of the pretensions of a computer industry mogul. "In order to meet the needs of customers, you have to be very good technically. . .but you get to the technology through up-close-and-personal contact with the consumer."