Bill Gates and The Guy Who Could Have Been Him (Part 7 of 10)

Appreciate more the story, read the previous post:

Part 1, Part 2, Part 3, Part 4, Part 5 and Part 6.


Once they got pass the hurdle, Kildall was cold to IBM’s insistence that Digital Research negotiate a flat licensing fee for CP/M and forgo Digital Research’s usual per unit royalty rate. It didn’t help matters that Kildall was generally disapproving of IBM because so many IBM products struck him as slow, unimaginative and clumsily designed.

But the biggest stumbling block preventing a deal was Kildall’s timing, or rather, his utter disregard for timing. IBM planned to build its personal computer around a new, faster Intel Chip called the 8086, but CP/M would need an upgrade in order to run on it.

Kildall already had such an upgrade in the works, called CP/M-86. But Kildall either wouldn’t guarantee to Sams that it would be delivered enough to meet IBM’s development deadlines.

Sams tried to explain that IBM needed a schedule and a commitment by October 1980, but Kildall resisted. Perhaps Kildall assumed that IBM would bend to his schedule, since it appeared that IBM needed him and CP/M’s 90% market share more than he needed IBM.

But what Sams gathered from Kildall’s attitude was that Kildall would never be a reliable partner and that the IBM PC project needed an alternative plan for an operating system.

Not long after, he stopped returning Kildall’s calls. Kildall’s fate was sealed forever as “the man who could have been Bill Gates.”

By giving up on Kildall and CP/M, Sams put himself in a tight spot. But Sams also knew that Gates, more than anyone, would be highly motivated to help him find a way out. During the time that Kildall was giving Sams a runaround over royalties and deadlines, Gates was back in Seattle bending over backward to accommodate IBM’s development schedule.

He had put almost Microsoft’s personnel to work on the IBM effort, shoving other projects to the side. Now Gates needed IBM PC project to succeed, if only out of a sense of survival of Microsoft.


Continue reading Part 8Part 9, and Part 10.


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.