Encyclopedia of Computer Science and Technology

206 Gates, William, IIIGame consoles such as this Microsoft Xbox are now more powerfulthan many desktop computers. (Microsoft Corporation)Takahashi, Dean. The Xbox 360 Uncloaked: The Real Story BehindMicrosoft’s Next-Generation Video Game Console. Spiderworks,2006.Xbox (Microsoft). Available online. URL: http://www.microsoft.com/xbox/. Accessed September 21, 2007.Gates, William, III (Bill)(1955– )AmericanEntrepreneur, ProgrammerBill Gates built Microsoft, the dominant company in thecomputer software field and in doing so, became the world’swealthiest individual, with a net worth measured in thetens of billions. Born on October 28, 1955, to a successfulprofessional couple in Seattle, Gates’s teenage years coincidedwith the first microprocessors becoming available toelectronics hobbyists.Gates showed both technical and business talent as earlyas age 15, when he developed a computerized traffic-controlsystem. He sold his invention for $20,000, then droppedout of high school to work as a programmer for TRW forthe very respectable salary of $30,000. By age 20, Gateshad returned to his schooling and become a freshman atHarvard, but then he saw a cover article in Popular Electronics.The story introduced the Altair, the first commerciallyavailable microcomputer kit.Gates believed that microcomputing would soon becomea significant industry. To be useful, however, the newmachines would need software, and Gates and his friendPaul Allen began by creating an interpreter for the BASIClanguage that could run in only 4 KB of memory, makingit possible for people to write useful applications withouthaving to use assembly language. This first product wasquite successful, although to Gates’s annoyance it was illicitlycopied and distributed for free.In 1975, Gates and Allen formed the Microsoft Corporation.Most of the existing microcomputer companies,including Apple, Commodore, and Tandy (Radio Shack)signed agreements to include Microsoft software with theirmachines. However, the big breakthrough came in 1980,when IBM decided to market its own microcomputer. Whennegotiations for a version of CP/M (then the dominant operatingsystem) broke down, Gates agreed to supply IBM witha new operating system. Buying one from a small Seattlecompany, Microsoft polished it a bit and sold it as MS-DOS1.0. Sales of MS-DOS exploded as many other companiesrushed to create “clones” of IBM’s hardware, each of whichneeded a copy of the Microsoft product.In the early 1980s, Microsoft was only one of manythriving competitors in the office software market. Wordprocessing was dominated by such names as WordStarand WordPerfect, Lotus 1-2-3 ruled the spreadsheet roost,and dBase II dominated databases (see word processing,spreadsheet, and database management system). ButGates and Microsoft used the steady revenues from MS-DOS to undertake the creation of Windows, a much largeroperating system that offered a graphical user interface (seeuser interface). While the first versions of Windows wereclumsy and sold poorly, by 1990 Windows (with versions3.1 and later, 95 and 98) had become the new dominant OSand Microsoft’s annual revenues exceeded $1 billion (seeMicrosoft Windows). Gates relentlessly leveraged boththe company’s technical knowledge of its own OS and itsnear monopoly in the OS sector to gain a dominant marketshare for the Microsoft word processing, spreadsheet, anddatabase programs.By the end of the decade, however, Gates and Microsoftfaced formidable challenges. The growth of the Internet andthe use of the Java language with Web browsers offered anew way to develop and deliver software, potentially gettingaround Microsoft’s operating system dominance (see Java).That dominance, itself, was being challenged by Linux, aversion of LINUX created by Finnish programmer LinusTorvalds (see linux). Gates responded that Microsoft, too,would embrace the networked world and make all its softwarefully integrated with the Internet and distributable innew ways.However, antitrust lawyers for the U.S. Department ofJustice and a number of states began legal action in the late1990s, accusing Microsoft of abusing its monopoly status