In 1975, two young computer enthusiasts, Bill Gates and Paul Allen formed a partnership called Microsoft. Like most start-ups, Microsoft began small, but had a huge vision—a computer on every desktop and in every home. In June 1980, they hired Gates’ former Harvard classmate Steve Ballmer to help run the company. The next month, IBM approached Microsoft about a project code-named “Chess.” In response, Microsoft focused on a new operating system—the software that manages, or runs, the computer hardware and also serves to bridge the gap between the computer hardware and programs, such as a word processor. They named their new operating system “MS‑DOS (Microsoft Disk Operating System).” When the IBM PC running MS‑DOS shiped in 1981, it introduced a whole new language to the general public. Typing “C:” and various cryptic commands gradually became part of daily work. People discovered the backslash (\) key.

MS‑DOS was effective, but also proved difficult to understand for many people. Microsoft worked on the first version of a new operating system. Interface Manager was the code name and was considered as the final name, but Windows prevailed because it best described the boxes or computing “windows” that were fundamental to the new system. Windows was announced in 1983, but it took a while to develop. On November 20, 1985, two years after the initial announcement, Microsoft shiped Windows 1.0. Now, rather than typing MS‑DOS commands, one just moved a mouse to point and clicked your way through screens, or “windows.” Bill Gates said, “It is unique software designed for the serious PC user.” There were drop-down menus, scroll bars, icons, and dialog boxes that made programs easier to learn and use. One was able to switch among several programs without having to quit and restart each one. Windows 1.0 shiped with several programs, including MS‑DOS file management, Paint, Windows Writer, Notepad, Calculator, and a calendar, card file, and clock to  manage day-to-day activities. There was even a game—Reversi.

Windows 1.0 was a flop comapred to Macintosh, as described by many critics. But it also was the embodiment of a technology vision which created a tech empire.

Reference:

http://windows.microsoft.com/en-IN/windows/history#T1=era0

http://windows.microsoft.com/en-IN/windows/history#T1=era1

http://www.cnet.com/news/windows-1-0-the-flop-that-created-an-empire/