This Day in History (4-Apr-1975) – Microsoft is founded by Bill Gates and Paul Allen

Childhood friends, Paul Allen and Bill Gates were total computer geeks in an age when any access to computers was hard to come by. Allen and Gates skipped classes to live and breathe in their school’s computer room. Eventually, they hacked the school’s computer but instead of expulsion, the duo were offered unlimited computer time in exchange for helping to improve the computer’s performance. Bill Gates and Paul Allen even ran their own small company called Traf-O-Data and sold a computer to the city of Seattle for counting city traffic.

In 1973, Bill Gates left Seattle to attend Harvard University as a pre-law student. However, Gate’s first love never left him, as he spent most of his time in Harvard’s computer center where he kept improving his programming skills. Soon Paul Allen moved to Boston as well, pressuring Gates to quit Harvard so that the team could work full-time together on their projects. Bill Gates quit Harvard.

In January 1975, Paul Allen read an article about the Altair 8800 microcomputer in Popular Electronics magazine.  Bill Gates called MITS, the makers of the Altair, and offered his and Paul Allen’s services to write a version of the new BASIC programming language for the Altair. In eight weeks, Allen and Gates were able to demonstrate their program to MITS, who agreed to distribute and market the product under the name of Altair BASIC.

The Altair deal inspired Gates and Allen to form their own software company, and Microsoft was started on April 4, 1975, with Bill Gates as the first CEO. In July 1975, Bill Gates used the name “Micro-soft” (the combination of the words microprocessor and software) in a letter to Paul Allen to refer to their partnership. The name was registered. By 1978, Microsoft excced $1m sell. Microsoft rose to dominate the personal computer operating system market with MS-DOS in the mid-1980s, followed by Microsoft Windows. As of now, Microsoft is market dominant in both the PC-compatible operating system and office software suite markets. In November, 2014, Microsoft became the 2nd most valuable company by market capitalization, behind only Apple Inc. with total market value over $410B.