History of Microsoft and Its Major Milestones

Inspired by an article in an electronics magazine, Microsoft would grow exponentially to dominate the tech market today.

Microsoft is one of the most successful tech companies in history, with a market capitalization of just over $1 trillion. Its products and acquisitions are used by hundreds of millions of people every day, and its logo is one of the most recognized around the world

We explore Microsoft's earliest days and answer some of the most commonly asked questions about them on the net. Still, the article is not intended to be a comprehensive history of the company.


When and where did Microsoft start?

The company that would eventually become Microsoft was first founded by Bill Gates and Paul Allen in Albuquerque, New Mexico, in 1975.

The pair were avid programming enthusiasts from a young age. Building on their existing skills, the pair were inspired to produce their own programming language based on the existing language BASIC — Microsoft BASIC.

Taking around eight weeks to compile, the pair of plucky would-be entrepreneurs showed BASIC to Micro Instrumentation and Telemetry Systems (MITS). 

MITS was the company that built the Altair 8800 microcomputer

MITS liked what they saw and agreed to distribute and market the product under the name of Altair BASIC. This deal inspired Gates and Allen to found their own software company, and in April of 1975, Microsoft was born. 

"When we signed that first contract with MITS, we referred to ourselves as 'Paul Allen and Bill Gates doing business as Micro-Soft.' I don't remember why we spelled it with a hyphen and a capital 'S.' We put a credit line in the source code of our first product that said, 'Micro-Soft BASIC: Bill Gates wrote a lot of stuff; Paul Allen wrote some other stuff.'" - Bill Gates.

History of Microsoft and Its Major Milestones
Source: Microsoft

From that moment on, Microsoft would continue to grow until it eventually became the tech giant we all know (or love and hate in equal measures) today. 

What are some key dates in Microsoft's history?

Providing a comprehensive history of Microsoft is out of the scope of this article, but according to Microsoft, here are some of the key early dates in their rise to world domination.

The following events were between 1975 and 2005 when the Xbox 360 was launched. At this point, Microsoft was already a market leader. 

For a fuller summary of Microsoft's history, we recommend checking out their official page

1975 Microsoft founded
Jan. 1, 1979 Microsoft moves from Albuquerque, New Mexico to Bellevue, Washington
June 25, 1981 Microsoft incorporates
Aug. 12, 1981 IBM introduces its personal computer with Microsoft’s 16-bit operating system, MS-DOS 1.0
Feb. 26, 1986 Microsoft moves to corporate campus in Redmond, Washington
March 13, 1986 Microsoft stock goes public
Aug. 1, 1989 Microsoft introduces the earliest version of Office suite of productivity applications
May 22, 1990 Microsoft launches Windows 3.0
Aug. 24, 1995 Microsoft launches Windows 95
Dec. 7, 1995 Bill Gates outlines Microsoft’s commitment to supporting and enhancing the Internet
June 25, 1998 Microsoft launches Windows 98
Jan. 13, 2000 Steve Ballmer named the president and chief executive officer for Microsoft
Feb. 17, 2000 Microsoft launches Windows 2000
June 22, 2000 Bill Gates and Steve Ballmer outlined Microsoft’s .NET strategy for Web services
May 31, 2001 Microsoft launches Office XP
Oct. 25, 2001 Microsoft launches Windows XP
Nov. 15, 2001 Microsoft launches Xbox
Jan. 15, 2002 Bill Gates outlines Microsoft’s commitment to Trustworthy Computing
April 24, 2003 Microsoft launches Windows Server 2003
Oct. 21, 2003 Microsoft launches Microsoft Office System
July 20, 2004 Microsoft announces plans to return up to $75 billion to shareholders in dividends and stock buybacks
Nov. 22, 2005 Microsoft launches Xbox 360

How did Bill Gates come up with Microsoft?

In short, he didn't — at least not on his own. The basic (pun intended) idea was mainly Paul Allen's idea. 

In what is now something of a legend, the idea for Microsoft came as a moment of inspiration for Paul Allen. Back in 1975, at the time, Bill was an undergraduate at Harvard University, and Paul worked for Honeywell Inc. as a computer programmer. 

Allen, at the time, a 22-year old, purchased a copy of the January edition of Popular Electronics. On the front cover was an image of the World’s First Minicomputer Kit to Rival Commercial Models — the Altair 8800 microcomputer.

history of microsoft popular electronics
Source: Computer Museum

Paul read the related article and struck on an idea. Allen, with his copy of Popular Electronics in hand, decided to pay his school-friend Bill Gates a visit. 

The two had been friends since their early days at Lakeside School (a private preparatory school in Seattle) and shared a passion for computers and programming. In fact, they had both become accomplished programmers and had been hired in 1971 to write a payroll program for the company Information Sciences, Inc. on behalf of COBOL. 

Paul made his pitch to Gates. His idea was to adapt the Beginner’s All-purpose Symbolic Instruction Code (BASIC) for the Altair 8800.

Gates was impressed and liked the idea. He was also successfully persuaded by Allen to leave Harvard to pursue their business idea. 

At that time, microcomputers, like the Altair 8800, executed source code provided by the machine's compiler but lacked an interpreter. Paul Allen proposed using BASIC to develop such an interpreter. 

If successful, this BASIC-based interpreter would make machines like the 8800 very appealing to hobbyists and professional programmers around the world. It should, Allen believed, also enable the cost of microcomputers to fall dramatically, making software development a viable business for many in the future.

With their pitch and interpreter prototype completed, the pair approached MITS for an in-person demonstration. Ed Roberts, the founder of MITS, agreed to the meeting, loved what he saw, and agreed to distribute a new machine with their software. - Altair BASIC.

In February of 1975, Allen and Gates sold their code to MITS for $3,000 (just over $14,000 today), plus a percentage of royalty payments (worth around $840,000 today).

The same year "Micro-Soft" was officially registered, and by 1976, it was formally incorporated in New Mexico in 1981. The rest, as they say, is history. 

Where did the Name Microsoft come from?

Back in 1975, Gates and Allen had mused over a few names for their new venture. 

"We had talked about a lot of different names back in Boston, and at some point, I said, 'Well, the totally obvious name would be [Micro-Soft].'" - Paul Allen

But there were other options on the table. 

"We also had mentioned names like Outcorporated Inc. and Unlimited Ltd., but we were, you know, joking around. We talked a lot about whether we should call it Allen & Gates, but decided that was not a good idea." - Bill Gates.

But the name "Micro-Soft" stuck. It was created by Allen as a portmanteau of "microcomputer" and "software."

After officially forming the same year, they would later open their first international office in Japan, called ASCII Microsoft, in 1977.

Two years later, in 1979, the company relocated to Bellevue, Washington, and eventually incorporated as Microsoft Inc. in 1981.

Bill Gates would take on the role of President of the company and Chairman of the Board, and Paul Allen became the company's Executive Vice President.

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