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MICROSOFT

By: Joe McBride

Briarcliffe College

Microsoft Corporation, leading American computer software company. Microsoft develops and sells a wide variety of computer software products in more than fifty countries. Microsoft’s Windows operating systems for personal computers are the most widely use operating systems in the world. Microsoft had revenues of $14.4 billion for the fiscal year ending June 1998, and employs more than 27,000 people in 60 countries. Microsoft has it’s headquaters in Redmond Washington.

Microsoft’s other well known products include, Word, a word processor; Excel, a spreadsheet program; Access, a database program; and PowerPoint, a program used for making business presentations. These products are sold separately from Windows as a part of Microsoft Office. Microsoft also makes Back Office, an integrated set of server products for businesses. Microsoft’s Internet Explorer allows users to browse the World Wide Web. Among Microsoft’s other products are reference applications; games; finical software; programming languages for software developers (eg; Visual Basic) ; input devices, such as pointing devices and keyboards; and computer related books.

Microsoft operates The Microsoft Network (MSN), a collection of news, travel, financial, entertainment, and information Web sites. Microsoft and the National Broadcasting Company (NBC) jointly operate MSNBC, a twenty four hour news, talk, and information cable television channel and companion Web site.

Microsoft was founded in 1975 by William H. Gates III and Paul Allen. The pair had teamed up in high school via their hobby of programming on the original PDP-10 computer from the Digital Equipment Corporation. In 1975 Popular Electronics magazine featured a cover story about the Altiar 8800, the first personal computer. The article inspired Gates and Allen to develop the first version of the BASIC programming language for the Altiar. They licensed the software to Micro Instrumentation and Telemetry Systems (MITS), the Altiar’s manufacturer, and formed Microsoft (originally Micro-soft) in Albuquerque, New Mexico, to develop versions of BASIC for other computer companies. Microsoft’s early customers included fledgling hardware firms such as Apple Computer, maker of the Apple II computer; Commodore, maker of the PET computer; and Tandy Corporation; maker of the Radio Shack TRS-80 computer. In 1977 Microsoft shipped it’s second language product, Microsoft FORTRAN, and it soon released versions of BASIC for the 8080 and the 8086 microprocessors.

In 1979 Gates and Allen moved the company to Bellevue, Washington, a suburb of their hometown Seattle. ( Microsoft moved to it’s current headquaters in Redmond in 1986.) In 1980 International Business Machines Corporation (IBM) chose Microsoft to write the operating system for the IBM PC personal computer, to be introduced the following year. Under time and pressure, Microsoft purchased QDOS (Quick and Dirty Operating System) from Seattle programmer Tim Paterson for $50.000 and renamed it MS-DOS (Microsoft Disk Operating System). As part of it’s contract with IBM, Microsoft was permitted to license the operating system to other companies. By 1984 Microsoft had licensed MS-DOS to 200 personal computer manufacturers, making MS-DOS the standard operating system for personal computers and driving Microsoft’s enormous growth in the 1980’s.

As sales of MS-DOS took off, Microsoft began to develop business applications for personal computers. In 1982 Microsoft released Multiplan, a spreadsheet program, and the following year, it released a word processing program, Microsoft Word. In 1984 Microsoft was one of the few established software companies that to develop application software for the Macintosh, a personal computer developed by Apple Computer. Microsoft’s early support for the Macintosh resulted in tremendous success for it’s Macintosh Application software, including Word, Excel, and Works (an integrated software suite). Multiplan for MS-DOS, however, faltered against the popular Lotus Development Corporation.

In 1985 Microsoft released Windows, an operating system that extended the features of MS-DOS and employed a graphical user interface. Windows 2.0 released in 1987, improved performance and offered a new visual appearance, In 1990 Microsoft released a more powerful version, Windows 3.0, which was followed by Windows 3.1 and 3.11. These versions which came preinstalled on most personal computers, rapidly became the most widely used operating systems. In 1990 Microsoft became the first personal computer software company to record $1 billion in annual sales.

As Microsoft’s dominance grew in the market for personal computer operating systems, the company was accused of monopolistic business practices. In 1990 the Federal Trade Commission (FTC) began investigating Microsoft for alleged anticompetitive practices, but was un able to reach a decision and dropped the case. The United States Department of Justice continued the probe.

In 1991 Microsoft and IBM ended a decade of collaboration when they went separate ways on the next generation of operating systems. IBM chose to pursue the OS/2 operating system (first released in 1987), which until then had been a joint venture with Microsoft. Microsoft chose to evolve it’s Windows operating system into increasingly powerful systems. In 1993 Apple lost a copyright infringement lawsuit against Microsoft that claimed Windows illegally copied the design of Macintosh’s graphical interface. The ruling was later upheld by an appellate court.

In 1993 Microsoft released Windows NT, an operating system for business environments. The following year Microsoft and the Justice Department reached an agreement that called for Microsoft to change the way it’s operating system was sold and licensed to computer manufacturers. In 1995, Microsoft released Windows 95, which featured a simplified interface, multitasking, and other improvements. An estimated 7 million copies of Windows 95 were sold world wide within seven weeks of it’s release.

In the mid 1990’s Microsoft began to expand into the media, entertainment, and communications industries, launching the Microsoft Network in 1995 and MSNBC in 1996. Also in 1996 Microsoft introduced Windows CE, an operating system for hand held personal computers. In 1997 Microsoft paid $425 million to acquire Web TV Networks, a manufacturer of low cost devices to connect the televisions to the Internet. That same year Microsoft invested $1 billion in Comcast Corporation, a United States cable-television operator, as a part of an effort to expand the availability of high speed connections to the Internet.

]In late 1997 the Justice Department accused Microsoft of violating it’s 1994 agreement by requiring computer manufactures that installed Windows 95 to also include Internet Explorer, Microsoft’s Software for browsing the Internet. The government contended that Microsoft was illegally taking advantage of it’s power in the market for computer operating systems to gain control of the market for Internet browsers. In response, Microsoft argued that it should have the right to enhance the functionality of Windows by integrating the Internet related features into the operating system. Also in late 1997, computer company Sun Microsystems sued Microsoft, alleging that Microsoft had breached a contract for use of Sun’s Java universal programming language by introducing Windows only enhancements.

Microsoft temporarily settled with the Justice Department in it’s anti trust case in early 1988 by agreeing to allow personal computer manufactures to offer a version of Windows 95 that did not include access to the Internet Explorer. However in May 1988 the Justice Department and 20 states filed broad anti trust suits charging Microsoft with engaging in anticompetitive conduct. The suits sought to force Microsoft to offer Windows without the Internet Explorer or to include Navigator a competing browser made by Netscape Communication Corporation. The suits also challenged some of the companies contract’s and pricing strategies.

In June 1998 Microsoft released Windows 98, which featured integrated Internet capabilities. in the following month Gates appointed Steve Ballamer, executive vice President of Microsoft, to become it’s president and take over most of day to day business operations for he company.

The federal antitrust trial against Microsoft began in October 1998. Executives from Sun, Netscape and several other computer software companies testified regarding their business deals with Microsoft. In November 1998, in the separate case brought by Sun Microsystems, a federal district court ruled against Microsoft on an injunction filed by Sun earlier that year. The injunction forced Microsoft to revise it’s software to meet Sun’s Java compatibility standards. Microsoft appealed the ruling. In 1999 Microsoft paid $5 billion to telecommunications company AT&T Corporation to use Microsoft’s Windows CE operating system in devices designed to provide consumers with integrated cable -television, telephone, and high-speed Internet services.

In my opinion, Microsoft will continue to take it’s place as the dominant figure in the computer software market for years to come. No other company in the world has such a tight grip on it’s industry or target market like Microsoft dose. By either squashing or consuming it’s competition Microsoft continues to grow and grow. Microsoft has such an outstanding lead on all competition that it will be virtually impossible for any of it’s competitors to catch up. Microsoft has invested money in every single corner of the computer software, communications and Internet industry. With revenues of over $14 billion just last year and prospects of over $20 billion for the year to come, the possibilities for the growth and success of Microsoft are virtually inconceivable. We can only sit back and wonder what new tricks or ideas Bill Gates and Microsoft have stashed up their sleeve. The forecast for the future of Microsoft appears to be bright and sunny with clear sky’s providing a smooth ride into the next millennium.

Source #1

Jones-Yang,Dori. ” The Empire Strikes Out ” U.S. News & World Report 15 November 1999: 46-54.

Source #2

” Bill Gates Web Site- Microsoft Timeline ” Nov. 1999: Microsoft.com. On-line. 10 Nov.1999. [http://www.Microsoft.com/billgates/bio]

Source #3

Microsoft 1999 Annual Report

[www.Microsoft.com/msft/ar99/hs.htm]


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