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Launching A Revolution: The Start of Microsoft

Article Overview: When Gates and Allen saw a picture of the Altair 8080 on the cover of Popular Electronics, they knew their lives were going to be different. They recognized that the home computer market was about to explode and that they had the opportunity to be at the forefront of it all. Immediately, Gates called Micro Instrumentation and Telemetry Systems (MITS), the company that was manufacturing the Altair, and told them that he and Allen had developed a programming language for the computer.

Launching A Revolution: The Start of Microsoft

When Gates and Allen saw a picture of the Altair 8080 on the cover of Popular Electronics, they knew their lives were going to be different. They recognized that the home computer market was about to explode and that they had the opportunity to be at the forefront of it all. Immediately, Gates called Micro Instrumentation and Telemetry Systems (MITS), the company that was manufacturing the Altair, and told them that he and Allen had developed a programming language for the computer.

With not a single line of code written and no Altair to work on, Gates and Allen worked around the clock on Harvard computers to do what they said they had already done. Eight weeks later, Allen flew to MITS headquarters in New Mexico to present their code. Without even a test-run, their program was a success and MITS bought the rights, making it an industry standard. Within one year, Gates had dropped out of Harvard and the two high school friends established Microsoft Corporation.

Their new company’s vision was “a computer on every desk and Microsoft on every computer.” In 1979, Gates and Allen took their company to Seattle and it was here where their venture really began to take off. Gates had learned that IBM needed an operating system for its new PC and he set out to create it. Buying an existing system from a Seattle company for $50,000, Gates reformed it into MS-DOS, which he then licensed to IBM. Thanks to Gates’ good business sense, Microsoft retained the rights to the program and was able to license it out to the numerous clone companies that would come out in later years. MS-DOS became the industry standard and sales for Microsoft rose from $7 million in 1980 to $16 million the following year.

For the next three years, Microsoft continued to grow and dominate the industry. It wasn’t until Apple introduced its Macintosh computer in 1984 that Gates encountered his first serious competition. In response to Apple’s user-friendlier interface, Gates took Microsoft public to generate capital for the development of Windows. While Windows wasn’t the success that Gates had hoped for, taking the company public had instantly made him one of the wealthiest men in the world. Microsoft continued to work out the bugs in the program and by 1993, 85% of the world’s computers were said to be running Windows.

It was during the mid-1990s when Microsoft’s dominance became almost untouchable. The company had begun to package its Windows software with its other applications into ‘Suites’, which were then sold to leading computer manufacturers to be preloaded onto every computer before sale. The strategy was a success and by 1999, Microsoft had increased its to profits to almost $20 million.

Gates’ rise to success has not been without its hurdles. Microsoft has become a regular participant in court cases, having been sued both by Apple for copyright infringement and by the US government for sustaining a monopoly and hindering the development of new technology. Despite having to make some concessions, the company continues to expand and retains its leading presence in the industry. Microsoft currently has over 61,000 employees and earns revenues of over $40 billion and in 2004, Gates topped the Forbes List of Richest Americans, with a net worth of $48 billion.

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Article Tags: altair 8080, apples, business sense, existing system, forefront, gates, good business, harvard, high school friends, home computer market, macintosh computer, micro instrumentation and telemetry systems, microsoft corporation, ms dos, new mexico, operating system, popular electronics, programming language, seattle company, single line



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