On November 6, 1980, Bill Gates signed a contract on Microsoft’s behalf to build the operating system for IBM’s upcoming personal computer — even though Microsoft didn’t actually have an operating system to sell yet. IBM needed software fast for its secretive PC project and had been turned down elsewhere, so it turned to the small Seattle software company best known at the time for programming languages like BASIC. Gates and Microsoft said yes, then scrambled to deliver.
The fix came a month later: Microsoft bought the rights to an existing operating system called 86-DOS from Seattle Computer Products and brought on its creator, programmer Tim Paterson, to adapt it for IBM’s machine. Crucially, in the negotiations Microsoft had kept the right to license the resulting software to other computer makers, not just IBM — a detail IBM reportedly didn’t push back on at the time. That single clause turned out to be one of the most consequential business decisions of the 20th century. When the IBM PC shipped in August 1981 running PC-DOS 1.0, Microsoft was simultaneously free to sell the same software to every other PC manufacturer as MS-DOS, and the rest of the industry followed IBM’s lead into the “IBM-compatible” PC era.
That one contract effectively set Microsoft on the path to becoming the dominant force in personal computing for the next two decades, built on an operating system it didn’t even have in hand the day it promised to deliver one.
Source: The Centre for Computing History, I Programmer
Daily Tech History is a running series looking back at notable moments in technology on this date.
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