Bill Gates and The Guy Who Could Have Been Him (Part 6 of 10)

Appreciate more the story, read the previous post:

Part 1, Part 2, Part 3, Part 4 and Part 5.


Even though the Softcard was a slight diversion from Microsoft’s normal focus on computer language software, Gates embraced it because it represented yet another strategic opportunity to extend CP/M’s market domination while also binding Microsoft BASIC to CP/M. Microsoft eventually sold hundreds of thousands of Softcards, which told Sams that it was a popular and reliable product.

Sams started his software hunt by contacting Gates and proposing IBM license the Softcard, along with all other programming languages Microsoft offered.

What Sams didn’t understand was that although Softcard was a Microsoft product, its most valuable feature was the CP/M operating system, owned by Digital Research. Gates told Sams that IBM needed to license CP/M directly from Kildall and offered to help Sams make the deal happen.

At the time, Gates accepted his subordinate position in the software food chain. He had positioned Microsoft so that the company’s success was dependent on CP/M’s continued market domination. If CP/M were paired with Microsoft BASIC inside the new IBM PC, Gates saw how the two complementary programs might be inseparable as industry leaders for years to come.

Gates arranged the initial meeting with IBM and Kildall. With Sams in the room, Gates called Kildall and said he was sending an important client and that Kildall should, according to sources, “treat them right.”

Gates’ phone call, however didn’t do much good. Almost nothing went right when Sams and his team sat down with Kildall and his wife Dorothy, who managed the business side of Digital Research. At first, Dorothy absolutely refused to sign IBM’s strict, strongly worded confidentiality agreement. An entire day wasted discussing what, if anything, the two parties could discuss.


Continue reading Part 7Part 8Part 9 and Part 10.


Bill Gates and The Guy Who Could Have Been Him (Part 5 of 10)

To better appreciate the story, it is recommended to read these previous post first:

Part 1, Part 2, Part 3, and Part 4.


The contrast in the two men’s personalities came to a head in 1980 when IBM contacted them about the new secret project. Big Blue was the largest computer company in the world that time. It occupied a dominant position in the industry that even its seven main competitors were known collectively as the seven dwarfs.

By the late 1970s, IBM salespeople started seeing Apple II’s and other personal computers popping up in the offices of their big corporate customers. IBM Chairman Frank Carey, sensing a treat, decided if IBM didn’t move fast to produce a little machine of its own, personal computer business would soon get too big for even Big Blue to dominate it.

In early 1980, Carey signed off on a plan to rush an IBM PC to market by September 1981. The strategy was to cut out years of laborious development by using off-the-shelf hardware and by licensing existing software from other companies. Except for the logo glued to each unit, nothing about the new IBM PC would be unique to IBM.

An IBM engineer named Jack Sams was in charged with setting up licensing deals for the IBM PC’s software. Of all the personal computers in the market, Sams was not impressed with the Apple II, which is why the Microsoft called the Softguard caught his eye.

The one drawback to the Apple II was that its proprietary operating system prevented it from running popular CP/M-compatible software applications including Wordstar and and dBase. The Softcard was a little translator card, created by Paul Allen at Microsoft, that snapped into the back of the Apple II and turned it into a CP/M-compatible machine.


Continue reading Part 6Part 7Part 8, Part 9, and Part 10.


Bill Gates and The Guy Who Could Have Been Him (Part 3 of 10)

Do not miss out Part 1 and Part 2.


With virtually no competition, CP/M earned Digital Research $85cents of profit on every dollar of revenue that came in. Officials at Digital Research’s bank once called to double-check some figures because they didn’t think it was possible for every company to have such high profit margins.

By mid-1980s, Kildall and Digital Research were both on the road to oblivion and today Kildall ranks as a mere footnote in computer history. The reason lies with a few crucial miscalculations he made in 1980, part of a cautionary tale about how imitation often trumps innovation.

One of the first computer entrepreneurs to hitch his wagon to CP/M’s rising start in the late 1970’s was a precocious young programmer named Bill Gates.

In 1979, when Gates was just 24y/o, he was running a software company called Micro-Soft. The company had secured an early, profitable niche in the personal computer industry by creating popular versions of BASIC and other programming languages that communicate between a computer’s hardware and its operating system software.

Gates and his partner, a high school friend named Paul Allen, didn’t stumble into the software industry the way Kildall had with Digital Research. Since their teenage years, Gates and Allen had been looking for ways to turn their passion for code-writing into cash. They originally wrote the Microsoft version of BASIC in 1976 because they saw a chance to get into the ground floor with one of the earliest makers of homebuilt personal computer kits.

After that, Gates often sought licensing deals that would pair Microsoft’s BASIC with Kildall’s CP/M, to the hope that Microsoft BASIC could ride CP/M’s coattails and become an industry standard of its own.


Continue reading Part 4Part 5Part 6Part 7Part 8, Part 9, and Part 10.


Bill Gates and The Guy Who Could Have Been Him (Part 2 of 10)


Miss out the first part? Read it here.


However, patching together the computer’s software wasn’t Kildall’s greatest accomplishment. It was what he had done with writing new software code. Out of absolute necessity, and with no thought of the commercial possibilities, he developed a master program so that his unique little computer could adapt itself to run a useful software applications designed for much larger stand-alone machines. That’s how Kildall developed the first operating system software for personal computers.

After revising it further so it could run on the newer and faster Intel 8080 microchip, Kildall would call his operating system CP/M (Control Program for Microcomputers).

When hobbyist strated building their own 8080-based home computers, Kildall realized he had created something of value. He put a small ad in a computer trade magazine and began selling copies of CP/M for $70, first to hobbyist then to other small computer makers.

Within the next six years, hundreds of thousands of personal computers had been sold with CP/M running inside them. Kildall and his wife Dorothy made millions of dollars without essentially trying.

When the personal computer revolution took off in the late 1970’s. it launched on the wings of Kildall’s CP/M operating system. Prior to CP/M, every computer manufacturer had to deal with the headaches of writing machine-specific software for word processing, database management, and all the other things that people use computers for. But thanks to Kildall, these companies could now simply license copies of the CP/M operating system and their customers could buy whatever CP/M-compatible software they liked.

In 1980, there were an estimated 600,000 PCs in the entire United States and about 90% of them were running on CP/M and using CP/M compatible software. Popular software programs that time like dBase and Wordstar worked only with CP/M. Kildall created the bedrock and subsoil out of which the PC software industry would grow, according to Harold Evans.


Continue reading Part 3Part 4, Part 5Part 6, Part 7Part 8, Part 9, and Part 10.