50 years of Microsoft: people, products, events

Spring 1975, USA. In a Harvard dormitory, 19-year-old Bill Gates and his 22-year-old friend Paul Allen don't just believe in the future of computer technology - they want to be its architects. On April 4, 1975, they found a small company that was destined to change the world. The company we know as Microsoft.

As is often the case, at first few people took them seriously. But the guys were stubborn, cunning and purposeful. So they didn't just survive, they turned the world of technology upside down and became a legend that was created right in front of several generations of computer fans and ordinary users.

Let's recall the main milestones in the history of the legendary company. Well, let's start with the founders themselves. Because the history of companies is very often the story of the people behind them, and Microsoft is certainly no exception.

Who are you, Bill?

Bill Gates is a man so legendary that there are various rumors about him. He is a child prodigy who could not tear himself away from the computers of that time and had crazy mathematical abilities, and a nimble young businessman who skillfully manipulated his surroundings, in particular Paul Allen. And a "garage guy", and the heir to an influential family. And a genius who created revolutionary software, and a cunning man who "borrowed" other people's ideas. And a man who walks on heads, and the greatest philanthropist, whose donations are calculated in billions. And, of course, in combination - a seer, an Illuminati, a Freemason, the creator of COVID-19 and the secret ruler of the Universe.

And some of this is true. But to understand where is legend and where is reality, you need to look into the past.

Bill was born into a wealthy family. His father, William Henry Gates II, considered his family middle class, but he was a little poorer. In fact, the Gateses lived not just comfortably, but very comfortably. His grandfather, William Henry Gates I, was not distinguished by much public activity, although his father, Bill's great-grandfather, was a state legislator and even a mayor. And Bill's father became a successful corporate lawyer and headed the Washington State Bar.

Bill's mother was also far from a housewife. Mary Maxwell Gates came from a family of bankers - her grandfather founded National City Bank in Seattle. Despite her education as a teacher, she quickly plunged into the world of influential people: she was a member of the boards of directors of chambers of commerce, charitable foundations, children's hospitals, insurance companies and even a division of AT&T, and in 1980 she found herself on the board of directors of United Way, where her colleague was John Opel, then president of IBM. Actually, this fact is very fond of being associated with the fact that after some time IBM signed a fateful contract with a small company Microsoft, which was destined to become a monopolist in the operating systems market. But we will talk about this contract a little later. For now - let's go back to the late sixties and look at two very promising schoolchildren.

Paul Allen and the birth of Microsoft

Paul Allen was a little older than Gates, and looked more solid (Bill was perceived as a teenager until he was 30), but these two had a common passion - programming. Now we have the Internet, numerous online courses, and you can program even on a mobile phone. And a neural network will help in case of need. The end of the sixties was another matter! In those days, this hobby was quite exotic and required considerable effort. It was necessary not only to understand the algorithms more or less independently, but also to find something to implement the program on, agree on machine time, and look for options.

In 1968, the school where Bill and Paul studied got access to a PDP-10 computer. It was a mainframe that took up an entire room, and you wouldn't call it a computer in the modern sense - there was no screen, mouse or even a keyboard. Instead, it was a teletype, an electromechanical typewriter that printed everything on paper, received commands and read punched tapes. You programmed on paper, ran them through the tapes, and the result... was also on paper.

The guys got into programming and even found bugs in the system of the Computer Center Corporation (CCC). In return, they were given free time on the machine - almost a perfect deal. True, they somehow hacked into user accounts, and received a short-term ban. But that didn't stop them: they quickly moved on to more serious things.

The first business experiment was Traf-O-Data. Allen and Gates developed a system based on the Intel 8008 for analyzing road traffic. And everything would be fine, but the state offered a similar solution for free.

But the real breakthrough came in late 1974. Paul Allen came across an article in Popular Electronics magazine about the Altair 8800, the first affordable personal computer based on the Intel 8080 processor. If computers were to become widespread, they would need software, the young programmer reasoned. And what came first? Of course, BASIC, a popular programming language at the time.

The guys called Altair creator Ed Roberts (MITS) and got a little carried away – they said they had a BASIC interpreter for Altair almost ready. He was interested. There was only one problem – they didn’t have an interpreter, they didn’t even have access to Altair itself. And it couldn’t be: at the time of the conversation, almost no one had seen it alive.

But there was a trump card – the same PDP-10 mainframe on which they had machine time. So Paul quickly wrote an Altair 8800 emulator for it to test the code. And Gates, together with mathematician Monty Davidoff, wrote a BASIC interpreter from scratch in two months, which fit into a fantastic 4 kilobytes of memory (that's less than the weight of a modern application icon).

Paul Allen flew to Roberts with punched tape in hand, loaded BASIC onto a real Altair, and it worked the first time (if you've ever programmed and tried to run your code on another machine, you know that's an achievement in itself). Impressed, Roberts immediately offered Allen a job at MITS, and in July 1975, he and Gates officially founded Micro-Soft (the hyphen disappeared a little later).

It cannot be said that everything was exactly perfect. BASIC was stolen en masse – it was simply copied without payment. Gates even wrote an angry open letter to programmers, calling for them to pay for the software. However, this did not stop the young company. They adapted BASIC for dozens of platforms (including the Apple II) and gradually expanded the staff.

Then came the big event. Allen began developing software for the highly promising Intel 8086 processor even before it was officially released. Microsoft was also actively working on CP/M (Control Program for Microcomputers), the most popular operating system at the time for 8-bit microcomputers based on the Intel 8080 and Zilog Z80 processors.

And it was these projects that opened the door to a major contract with IBM, which would make Microsoft a technological empire.

Contract with IBM and MS-DOS

Everyone evaluates the history of the contract with IBM very differently, and there are about as many legends around it as there are around the person of Bill Gates himself.

So, IBM was preparing its first personal computer (remember the expression "IBM-compatible PC"?) and was in a big hurry. There were competitors all around, and also bureaucracy and antitrust laws. So they decided to take a risk: instead of internal developments, they used third-party components, open architecture, and software from someone who knows how to create it.

For programming languages, they turned to Microsoft, a company that had already formed a positive impression after the success of Altair BASIC. But for the development of the operating system, IBM initially went to Digital Research, the creators of the aforementioned CP/M operating system. But the negotiations broke down. Why - history is silent, but Microsoft took this chance.

Microsoft didn't have an operating system. But they did have Paul Allen, a high-level programmer with a good "nose" for useful connections. They knew that Seattle Computer Products had a semi-finished system called 86-DOS (aka QDOS), which their engineer Tim Patterson had written as a replacement for CP/M. Microsoft quickly licensed it and later bought it outright.

The deal with IBM looked pretty mundane: Microsoft sold them its operating system called PC-DOS and programming languages for $430,000. But the key point: Gates reserved the right to sell the same operating system to other manufacturers – as MS-DOS. IBM, which was more interested in hardware, did not object.

And then the machine started spinning: the IBM PC came out in August 1981 and became a megahit. Other companies started making compatible computers – clones. And each of them needed MS-DOS. And so Microsoft became the monster of the industry.

And in the video below you can see the game DONKEY.BAS. It was distributed with early versions of PC-DOS and the BASIC language interpreter. Bill Gates and Neil Konzen wrote it in one night to show off the capabilities of BASIC and the IBM PC.

In general, there is a legend about the IBM and Microsoft contract that it was Bill's mother - the influential Mary Gates - who "arranged a contract for her son" through an acquaintance with the top IBM executive in a charity organization. Who knows... but most likely it's just a legend. Connections may have helped a little, but let's not forget: we were no longer just guys who didn't finish their studies at university and hung out in the garage around the clock, but a promising company with a turnover of millions at that time. Plus connections. Plus smarts, courage, and a little luck. As always in the history of big deals.

Steve Ballmer – the loud voice of Microsoft

When talking about the people who were the face of early Microsoft, it is impossible not to mention Steve Ballmer – one of the company’s first employees and a close friend of Gates. He joined Microsoft as a business manager back in 1980, becoming the company’s thirtieth employee. Then he dropped out of Stanford Business School, believing in the prospects of the young company. And he was right.

Ballmer instantly became an integral part of Microsoft's culture. If Gates was the brains, Ballmer was the voice and the energy. When he went to a Windows presentation, it wasn't just a product presentation, it was a one-man show. He would jump around the stage, scream, sweat, and tear his shirt. His famous "Developers! Developers! Developers!" chant became legendary long before the era of viral videos.

In contrast to Gates' cold analytical mind, Ballmer was the living embodiment of passion for the product. As they said at Microsoft, "Bill comes to the kitchen to make sure the refrigerator is working properly. Steve comes to eat the whole cake and tell the chefs how good they are."

It was Ballmer who built Microsoft's sales force during its most important years, when the company was transforming from a small startup into a corporate giant. His charisma helped to close key deals that made Windows the de facto standard for millions of corporate computers. And later, in 2000, when Gates decided to step down from running the company, it was Ballmer who succeeded him as CEO.

And only over time, as the world took a sharp turn toward mobile devices, did it become clear that Ballmer's energy could not replace the visionary spirit needed for a new technological revolution. But that's another story altogether.

Windows

MS-DOS, of course, is a luxury. But not everyone likes to work with the command line. Everything had to be entered manually from the keyboard: C:\> and then some magic commands, such as dir, copy, format .

But in the same seventies, there were companies that thought about how to improve the user experience. It may sound strange to some, but the pioneer of the computer graphical interface was Xerox. It was in its laboratories that the computer with a mouse, windows, icons and a graphical interface was born. They literally created what we call today a "regular operating system". However, Xerox did not know what to do with it, but there were those who understood. And these were Apple, led by Steve Jobs. In principle, nothing surprising.

So Apple, inspired by Xerox, created the Apple Lisa - the first PC with a graphical user interface (GUI). It was like the Ferrari of scooters: beautiful, revolutionary, and... cost $10,000, which was a bit too much. Then came the Macintosh - cheaper, stylish, with a mouse and icons, Jobs showed everyone what the "computer of the future" should look like.

Gates also came to Xerox, looked... and decided to do something similar, but cheaper. That's how the idea of Windows came about. Not an operating system as such, but a graphical shell for MS-DOS.

In 1985, Windows 1.0 was released. It wasn't that the world immediately fell into a frenzy - you couldn't move windows around as you pleased, only in a mosaic: one next to the other, but without any freedom. There was a mouse, but many people didn't understand why they needed it at all. But there was Paint, and then there was Reversi - a game that probably made more people learn to click than any textbook.

In the video below, 30-year-old Steve Ballmer promotes the first Windows with a fervor that any modern blogger or face of "The Couch Shop" would envy.

Although the system looked clumsy, it gave the average user the chance for the first time to not have to dig into the manual to find out how to copy a file. Technically, it was a challenge: computers back then were like today's calculators - an Intel 8088 processor, 256 kilobytes of RAM, and this was considered a luxury. But Microsoft didn't stop - even though sales were, let's say, restrained and reviews were diplomatic.

Two years later, Windows 2.0 appeared: windows could now overlap each other, there were minimize and maximize buttons - that is, now you could make a window small, large or small again. There was support for new processors, more colors (up to sixteen!), hot keys and more lively work in general. The Control Panel received a couple more sliders and checkmarks.

And then came 1990. Windows 3.0. And it was already a boom. It looked nicer, worked more stably, supported normal memory, launched more programs simultaneously, and most importantly – it really looked like a system that you wanted to use, not just endure. There was already a Program Manager, a File Manager, games, antivirus, the ability to listen to sounds from a CD – it felt like we were confidently stepping into the future. Solitaire "Kosinka" and "Sapper" became icons of office leisure: whoever did not spread out cards while working either really worked, or did not know how to use a mouse.

And with 3.1, things got even more serious – at first, they planned just cosmetic changes, but the product turned out to be a standard for a long time. Windows was no longer just catching up with others – it was taking first place. And then there were the hit Windows 95, the decent Windows 98, the slightly dubious Millenium, the super-successful Windows XP again, the failed Vista, the convenient Windows 7… And of course, modern versions. And then there were server versions, which firmly occupy their niche.

Office, Explorer and Business

Gates realized in time that the Internet is not a fad, but the future, although he walked on thin ice and almost missed this revolution: in the book The Road Ahead (1985) there was not a word about the global network. But then - a 180° turn and the famous letter "The Rise of the Internet". Microsoft urgently restructured, and Gates admitted: this was the moment of the greatest fear in his career - the fear of not being in time.

So Windows brought Internet tools and, of course, Internet Explorer. Netscape once ruled the browser kingdom, but Microsoft bundled its Internet Explorer for free with Windows, killing the competition. IE6 became the de facto platform for the web: clunky, unstable, but ubiquitous. But that king didn't last long either: Firefox and Chrome came along.

Of course, it is also worth mentioning Microsoft Office. Without an army and guns, but with Word, Excel and PowerPoint, Microsoft conquered the offices of the planet. Excel destroyed accounting books, Word – typewriters, Outlook – paper letters. Office became the standard, and the .doc format – its weapon.

But the main thing is the corporate segment. Microsoft sold not just Windows, but an entire ecosystem: Active Directory for user management, Exchange for mail, SharePoint for document management. This helped IT directors avoid a "technology zoo", when changing one thing often meant changing everything. So specialists took Microsoft - because it works. Microsoft knew: business does not like surprises, business loves stability. And it sold this stability - for very good money.

Windows 95, games and…

1995. Gates plays DOOM on Windows 95 in a promotional video. And it's no longer just an MS-DOS shell. Unlike Windows 3.x, which was installed on top of MS-DOS, Windows 95 integrated MS-DOS 7.0 into itself. It loaded DOS, but then intercepted most of the system management functions using its own 32-bit components. Here appeared a convenient "Start" button, a taskbar, file drag-and-drop, multitasking - it seemed that computers had finally become "for people". People stood in lines - not for an iPhone, but for the operating system. Windows 95 became an icon. Microsoft shot like never before. Most computers on the planet were launched from it.

This was the moment when Microsoft truly became the most powerful company and monopoly. They were able to impose their OS as a standard, sell it with PCs, and leave no chance to competitors. Mac "retired" into a niche. Linux was a wild field for geeks. And Windows became a home for everyone. Both for offices and for gamers. By the way, the latter did not immediately want to switch from the usual MS-DOS, but "Window 95" convinced them and Microsoft became the main platform for PC gamers. The DirectX tools helped a lot, allowing developers to create games that looked and worked better on Windows.

By the way, about gamers. At first, Microsoft was not very good at games. Yes, they had a great Flight Simulator. The product with this name appeared back in 1982 on the basis of previous developments of the company subLOGIC. This is a really serious flight simulator, which becomes more and more sophisticated with each version. The sim has a fan base, but it is not and never will be a mass game.

And then he appeared...

Xbox

By 2001, everyone was already used to the fact that game consoles are about the Japanese. There were two titans in this market – Nintendo and Sony, as well as the legendary Sega and a little Panasonic. PlayStation has been considered the embodiment of style since the 1990s: CDs, Final Fantasy, Metal Gear Solid, Gran Turismo – even the console’s start-up screen saver was a separate fetish. Nintendo is a separate religion in general. There were (and are) Mario, Zelda, Pokemon – and all this is about childhood or a break from adulthood, bright colors from the geniuses of game design.

And here is Microsoft. An American company associated with Word and the blue screen of death, and in general with software, not hardware, suddenly starts selling its own "box" for games. It looked like a VCR mixed with a plastic transformer, but it was really powerful. Xbox had better graphics, could play music from a hard drive, and had online support from the very beginning.

But most importantly, Halo. This shooter did what Mario did for Nintendo: create a reason to buy a console. Master Chief became the new idol, the game mechanics - the benchmark. Sony at that time also had its masterpieces, but Microsoft managed to make one game that built the platform.

Sure, the Xbox never really took off in Japan, but it took off in the US and Europe. And the next generation, the Xbox 360, showed that Microsoft could be even more popular than the PlayStation 3. Well, for a while at least. The Xbox Live online service was revolutionary. Where Sony was still figuring out how to connect players, Microsoft was already amassing armies of Halo 3 fans.

Nintendo, on the other hand, stood apart. They always played their own game. GameCube, Wii, Switch – each console is unconventional, a little strange, but with a deep understanding of the “fan”. Microsoft didn’t try to beat them. It did something different: it built a platform for “adult” gamers – with serious graphics, with Call of Duty, with large open worlds.

Today, the difference is even more pronounced. Nintendo is fun. Sony is beautiful. And Microsoft is a service. With Game Pass, you don’t buy a game – you subscribe to a gaming world. It’s Netflix for gamers. And what’s interesting is that almost everyone else eventually followed suit. As always with Microsoft: they rarely get first, but they set the standard. Just like with Windows.

Failures and setbacks

But even giants fall. Microsoft has its own list of blunders – long, loud, and, in places, funny.

Windows Phone was Microsoft's late arrival to the smartphone party. The interface was cool, but without apps, it was a dead platform. The Nokia acquisition only underscored the scale of the defeat. Ballmer himself admitted: "We missed the mobile revolution."

Zune is an attempt to kill the iPod, born too late. Not a bad player, bad timing, strange design, very cool software. Unfortunately, Apple was already selling the lifestyle.

Microsoft Bob – an OS interface with a virtual house, dog and furniture. The idea is futuristic, the execution is not. Even "Clippy" seemed brilliant by comparison.

Kin – a phone for teenagers that lasted 48 days. Billion dollars – less than 10,000 units sold. A classic anti-example in marketing.

Windows Vista is an operating system with a bigger appetite than RAM users. Slow, buggy, and perfect for making you fall in love with XP.

Surface RT – a Windows tablet that didn't run familiar Windows apps. Confusion, failure, $900 million in losses.

But despite everything, Microsoft was not afraid to experiment – and quickly closed down what didn’t work. Sometimes, over the horizon, there was not an opportunity, but a wall. But the giant moved on.

Microsoft's best purchases

The game of buying and selling is Microsoft's special art. And in this game, it is the champion of the money triathlon.

Bungie was the first big hit. The small studio was making a Halo game for the Mac, but Microsoft decided it would be an Xbox exclusive. $30 million – and console shooters were no longer seen as a joke.

Mojang – $2.5 billion for the pixel sandbox Minecraft. This digital Lego is good entertainment, especially for the younger generation, and also serves as a worthy educational tool. Microsoft didn’t buy a game – it bought a generation of players.

Bethesda – $7.5 billion for Fallout, Elder Scrolls, DOOM and a bunch of other worlds. A deal that made Microsoft the master of fantasy franchises. And at the same time, it was a wake-up call for Sony: "Look, we can make all of this exclusive."

Activision Blizzard is no longer a bell, but a siren. $69 billion is the largest deal in the history of the gaming industry. Call of Duty, World of Warcraft, Diablo, Overwatch, Candy Crush — Microsoft has gathered the entire gaming palette under one roof. This is not just a purchase - it is an entrance to every gaming house. But also courts, regulators, headlines like "Monopoly is coming." The acquisition was blocked for a long time, but eventually allowed. But a warning was sounded: next time everything may be more difficult.

LinkedIn – $26.2 billion for the social network for office people. Boring? Not at all. It’s a database of the entire business world: who works where, what they do, what they’re looking for. The perfect tool for promoting Teams, Office 365, and Azure.

GitHub – $7.5 billion for the largest code repository. Microsoft and open source used to be from different universes. Now Microsoft is a top contributor to open source projects. GitHub gives it live analytics from the heart of the IT world. Brilliant.

And, of course, it's all about the money. Since Satya Nadella became CEO in 2014, Microsoft shares have skyrocketed 5-fold. Every billion in investment comes back with bonuses.

But there’s another side to the coin: scale. Microsoft is getting too big. Its acquisitions are no longer just a strategy; they’re grounds for antitrust investigations and lawsuits. Blizzard was a big win, but the company’s next acquisition may not be forgiven. Because when you buy the world, the world starts to worry.

Technoromance with lawsuits and betrayals: Microsoft, Apple and Google

Unfortunately, not everything in the IT world is decided by innovation. Sometimes lawyers do. Microsoft is a true champion in the "who filed against whom" competition. And, of course, a virtuoso in getting the most out of ideas that are not their own.

In 1988, Apple sued Microsoft over Windows 2.0, claiming that the interface was borrowed. Microsoft did not deny the similarities, but noted the common ancestor of the Xerox Alto. Microsoft almost got out of the water - because between the lines of the contracts with Apple it turned out that the cunning Gates had already signed a license to use some of the "borrowings".

In general, Microsoft's relationship with Apple is like a drama series "Everything is complicated." They quarreled, reconciled, fought again, and then suddenly Gates invested $150 million in Apple in 1997, when it was teetering on the brink of bankruptcy. Steve Jobs then declared from the Apple stage: "We are no longer enemies." Microsoft received a block of shares without voting rights, and Apple - a chance at a second life. The irony is that thanks to this money, it later triumphantly overtook Microsoft in terms of capitalization.

But the real bitter plot unfolded in the new millennium. Microsoft sincerely believed in Windows Mobile: the Start button, the stylus, mobile Word. And Google – supposedly an ally – quietly developed Android. And when the time came, it simply gave it away for free to manufacturers. Microsoft remained on the sidelines.

But losing gracefully is also an art. Because of patents, Microsoft began to receive licensing payments from Android. In fact, it earned billions on someone else's platform, while its own Windows Phone quietly disappeared.

Over time, Microsoft became more open: more services for everyone, less toxicity. But it learned the lessons of the past. And it entered the new race – for artificial intelligence – in an adult way: with an investment in OpenAI and a clear understanding that the winner is not the one who dreams, but the one who acts first.

Satya Nadella and the present

Satya Nadella, the one who replaced Steve Ballmer as CEO, is nothing like his predecessor. He didn't thunder at conferences, didn't bang his fist on the table, didn't predict the future in cyberpunk style. He just came in and... restarted Microsoft.

Under his leadership, Microsoft began to abandon its obsession with Windows as the sole source of profit and influence. A new religion emerged at the company: “the cloud.” Or rather, Azure. Although Azure had been around since 2008, before the new CEO, Nadella didn’t just invest in cloud services—he made them the core of the business. And it worked. Once Microsoft was associated with Start and PowerPoint. Now it’s associated with neural networks, giant data centers, and artificial intelligence.

Another thing – Nadella changed the very atmosphere of the company. Instead of “bite your throat to survive” something new appeared – growth mindset. A culture of learning, adaptation, openness to mistakes and to other technologies (even to Linux!). Microsoft has become friendlier. Both for developers and for users.

It was under Nadella that Microsoft partnered with OpenAI, the same company that created ChatGPT. Microsoft invested billions in it, and not only in money, but also in computing power. And as a result - Copilot in Word and Excel, AI assistant in Bing, smart functions in Teams, speech synthesis, code, documents - all this is now built into them. Nadella says: artificial intelligence today is like the Internet in the 90s. We are moving from "autopilot" to "copilot": when the machine does not just advise you something, but works next to you, literally in the same room.

Of course, not everything is so rosy. Nadella says honestly: yes, AI will change the labor market. Some professions will disappear, others will become more complex. Salaries will rise in some sectors and fall in others. But Microsoft is not just throwing this challenge to the world - they want to control exactly how these changes will happen. With ethics. With public discussions. With transparency. At least, that's what they promise.

And here's what's interesting: under Nadella, Microsoft has become "fashionable" again. A company that doesn't try to buy up everything (well, except for Activision Blizzard — but that's a separate topic), but creates something that is really needed. A company that no longer seems like a dinosaur from the past. But rather, a quiet giant sneaking into the future... with a co-pilot by its side.

The financial results of the fourth quarter of 2024 made it clear that this path was successful. The company's main income now comes from the Azure cloud. It is no longer just data centers, but a powerful ecosystem that embeds artificial intelligence into all aspects of working with Microsoft - from Word to Teams, from Bing to Copilot. This change in approach to business has allowed Microsoft to become not only a technological leader, but also to remain relevant in a world where virtual assistants and clouds are becoming the norm.

This is Microsoft in its 50th anniversary year. Instead of fighting for a monopoly, it has become the architect of an era where machines are partners, not competitors. Microsoft's anniversary is not about "wow, they're 50." It's about "wow, they're ahead again." And maybe this time, for good.