June 25, 1981
Microsoft incorporated. Founded six years earlier by Bill Gates and Paul Allen, Microsoft grew out of the friends’ development of BASIC for the MITS Altair home computer kit. With later successes in its Windows operating system and software such as Word and Excel, Microsoft has grown to dominance in the personal computer software industry and billions of dollars of revenue.
Microsoft made a name for itself in 1981, when IBM unveiled the first PC to run MS-DOS. Perhaps the company’s most famous product, Windows, was introduced in 1985.
Windows replaced the daunting command-line interface of MS-DOS — essentially a blank screen with a blinking cursor that waited for you to type commands in the form of words and symbols — with a much friendlier interface.
But it was the first version of Office software in 1989 and the release of Windows 3.0 in 1990 that started Microsoft’s climb to the top of the software industry.
In 2000, Gates named Steve Ballmer CEO and continued his bigger-picture role at Microsoft as chief software architect. Microsoft’s market position surged during the 2000s, as the company released Windows XP and aligned itself as a premier business-to-business vendor.
Microsoft got into video gaming with the release of the Xbox in 2001. First considered a questionable decision, Xbox and the subsequent Xbox 360 have turned into one of the company’s billion-dollar businesses. After trailing Nintendo’s Wii for years, Microsoft secured a lead in gaming with the release of the Kinect motion sensor in 2010.
Gates stepped down from day-to-day responsibilities in 2008, leaving Ballmer and his other deputies in charge. While he is still chairman of the board, Gates works mainly with Seattle’s Bill & Melinda Gates Foundation, which he built into the largest charity in the world.
After Windows Vista failed to take hold and since the release of the Apple iPhone in 2007, Microsoft’s image as an influential consumer company has faded. Once a powerful player the early game of smartphones, Microsoft is now trying to claw back into the mobile-devices race. Despite numerous attempts, the software giant has found it difficult to make waves in hot markets such as smartphones, tablets, music players, cloud computing and search engines.
However, its consumer cash cows — Windows and Office — continue to dominate their markets. Windows 7, released in 2009, was the fastest-selling operating system on record, and Microsoft is hard at work on a major refresh with Windows 8.
After its acquisition of Skype in 2011, the company now includes six business units and operates more than 100 international subsidiaries. As of Sept. 30, 2011, Microsoft had about 90,800 employees.