History of Microsoft - Research Paper Example

The cultural legend, Microsoft Corporation, is the biggest software developer in the world with yearly profits of over $32 billion. Focused on the development, manufacture, and licensing of software products, technologies and services, the company succeeded in its vision: a Microsoft product in every home, school, and office and practically on every computer in the world (“A History of Windows”). The Beginnings Born from a wealthy Seattle family in 1955, 14-year-old Bill Gates began testing and writing computer programs with high school friend, Paul Allen, a son of two Seattle librarians. In 1972, Gates and Allen founded their first company, Traf-O-Data, which marketed a basic computer for recording and analyzing data in traffic. Inspired by Altair 8000, an underdeveloped computer launched by MITS (Micro Instrumentation and Telemetry Systems), the two computer savvies developed BASIC, a simple programming language for the machine. Later they transferred to Albuquerque, New Mexico, near MITS Computer, to expand more languages for the Altair (“Microsoft Corporation – Company History”). Realizing the big potentials in software languages, Gates and Allen founded Microsoft on April 4, 1975 in Albuquerque. Microsoft was derived from “microcomputer“ and “software.” The company earned $16,000 in 1975. In 1976, Gates and Allen registered the company’s trade name. A year later, Microsoft’s FORTRAN, a second software language was launched, followed by a 1978 version, COBOL. Both languages were made for CP/M operating system. The CP/M which was used by big computer companies such as Sirius, Zenith, and Sharp, earned huge profits and fame for Microsoft. The company then became pioneer in microcomputer language distribution with revenues of $1 million, a workforce of 13 employees, and a sales branch in Japan. The company moved to Bellevue, Washington in 1979 (“Microsoft Corporation – Company History”). Associations with IBM and Apple in the Early Eighties Big success for Microsoft happened in 1980 when IBM hired Microsoft to develop an operating system for IBM’s Personal Computer or PC. At that time, because Microsoft still did not have its own operating system, the company bought the rights to Seattle Computer Products’ system for $75,000. The operating system was named MS-DOS ("Microsoft Disk Operating System") and personalized for IBM's use. Under an agreement, Microsoft managed to keep market rights to MS-DOS. Aside from its contract with IBM, Microsoft was able to sell the MS-DOS to other companies and consumers, raking big fortunes for Microsoft. In 1980, the company implemented a strict rule to always maintain funds in the bank sufficient for the company’s year-round operation supposing there were no profits for the year. In 1999, Microsoft had over $13 billion cash reserves and no long-term arrears (“Microsoft Corporation – Company History”). In 1981, the company restructured; became an incorporated business; and renamed Microsoft, Inc., with Gates and Allen as president/chairman and as executive vice-president, respectively. Before the end of the year, Microsoft had 128 workers and $16 million earnings. It was in 1983 when the company introduced Word 1.0, a word processing program, intended to replace the more expensive WordStar which was then the leading program. Word 1.0 came with the introduction of mouse-use, cursor and bold and italic display fonts. However, its complexity gave way to the invention of a simpler word processing program from a rival company, WordPerfect Corporation. Three years later, Microsoft released a better version Word 3.0 which became a best-seller (“Microsoft Corporation – Company History”). Microsoft partnered with Apple in the improvement of Macintosh computers. In 1984, the new Mac was launched with a more improved graphical user interface, better and simpler than the interface used by IBM PC. Microsoft designed BASIC, Word and Multiplan exclusively for Macintosh computers. The 1983 profits of $50 million doubled in the following year (“Microsoft Corporation – Company History”). In November 1985, Microsoft, with the support from hardware companies and software publishers such as Texas Instruments, Hewlett-Packard, Compaq, and Digital Equipment Corporation, launched Microsoft Windows, an interface manager for MS-DOS intended to win over IBM’s domination of the personal computer world. However, Windows failed to achieve adequate reception from costumers due to its limitations on applications access and system slowness, thus delaying purchase choice of costumers and eventually increasing their anticipation of IBM’s new interface manager called the TopView. Microsoft worked in partnership with IBM for the design of a more innovative operating system called OS/2. In the same year, Microsoft’s introduction of Excel 1.0 brought in $1 billion annual revenues for the company. Excel was an improvement of the company’s ineffective Multiplan and the rival’s Lotus 1-2-3 (“Microsoft Corporation – Company History”). Into a Corporate Society in the Late Eighties Microsoft transferred to a 40-acre business site in Washington in 1986. The company’s strategic decision to offer 2.5 million shares to the public earned Microsoft a total of $61 million. Stocks rose from $25 to $85 in the following year. In 1987, 31-year-old Gates was proclaimed a billionaire. Microsoft released Microsoft Bookshelf, Excel for Windows, PowerPoint, and OS/2. Before the end of 1987, an improved version of the operating system, Windows 2.0 was released. Over 1 million copies of Windows 2.0 were sold (“Microsoft Corporation – Company History”). Microsoft Office was launched in 1989. The Office came with standard and shared features, plus Word, Excel, PowerPoint, and an e-mail program Mail, with the Access database management program. In late 1989, Microsoft became a major distributor to a majority of hardware manufacturers. A year after, the company manned by more than 5000 employees, dominated the software market, making the company wealthier by $1 billion (“Microsoft Corporation – Company History”). More Innovations in the Nineties An operating system suitably made for corporate users, Windows NT was released on July 27, 1993. Later an upgraded version called Windows NT 3.1 was designed as a tactical business schema that supported high-end engineering and scientific programs (“A History of Windows”). That same year, Encarta, the primary multimedia encyclopedia on CD-ROM, was released (“Microsoft Corporation – Company History”). Two years after, Windows 95 was born, with record-breaking sales of 7 million copies in only five weeks. This operating system featured functions of fax/modems, emails, multimedia games and educational software, as well as integral internet support, dial-up network connection, and Plug and Play facility (“A History of Windows”). Particularly designed for consumers, Windows 98 featured internet capabilities, DVD reading device, USB (universal serial bus) and Quick Launch bar (“A History of Windows”). Following Windows 98 was Windows CE, a more expanded form of operating system with computer capacities made for use in mobile phones, digital televisions and cameras, point-of-sale terminals, pocket organizers, handheld computers, and auto multimedia systems. By the year 1999, Microsoft successfully made over 100 agreements of exclusive licensure with manufacturers of the mentioned digital devices (“Microsoft Corporation – Company History”). Unparalleled Growth in the New Millennium Windows 2000 was developed as replacement for Windows 95, Windows 98, and Windows NT Workstation 4.0. Windows 2000 was specifically intended for all business desktops and laptops and with major upgrades in dependability, user-friendliness, Internet compatibility, and mobile computing support. Likewise in the same year, Windows ME (Millennium Edition) was released. This operating system was intended for home use, enhanced with multimedia music and video; home networking options and capabilities; and dependability advancement (“A History of Windows”). Launched in 2001 was Windows XP, designed for both consumer and business lines. This was a combination of the consumer-designed Windows 2000 and improved DOS imitation of OS functions. Microsoft introduced the Microsoft Product Activation which would require legal registration with the company before gaining access to the system (“Microsoft Corporation – History”). Year 2000 marked Microsoft’s entrance into the PC gaming world. Being the prime gaming console system to enter the gaming market, Microsoft’s Xbox system sold 24 million units. Still, the company lost $4 billion due to stiff competition with PlayStation 2. In 2005, Microsoft made an improved version, the Xbox 360 which sold 28 million units worldwide in four years. At present the Xbox 360 is one of the best-sellers in the gaming system (“History of Microsoft”). Windows Vista was released in 2006, with the strongest network access security among all operating systems designed by Microsoft. Vista featured the Windows Media Player for digital media such as movies, television and photographs; and the User Account Control for protection against possible unsafe software (“A History of Windows”). At the same time Vista was released, Microsoft Office 2007 was likewise introduced to consumers in more than 39,000 retail outlets in 70 countries worldwide. The duo provided impressive graphic improvements to the interface for visual stimulation and easy use and accessibility. Online and offline games were made more accessible. Digital sharing and viewing of photos, documents, videos and music were likewise made possible (“Microsoft Launches Windows Vista and Microsoft Office 2007 to Consumers Worldwide”). The sales of laptops surpassed desktop markets in 2009. Windows 7 was released at the time when trends in wireless and seamless connections were dominating the computerized modern world. Windows Touch followed the trend, making possible the use of fingers in surfing the web, opening documents, files and folders, and flipping through pictures. Another attractive characteristic of Windows is its ability to access audio and video from the computer to the television. Today, seven copies of Windows 7 are being purchased every second – the fastest and biggest selling experience in operating systems (“A History of Windows”). The first Microsoft Store was opened in Scottsdale, Arizona on October 22, 2009, the very same day Windows 7 was released (Fried). Microsoft’s venture to launch a chain of Microsoft-branded retail outlets targeted a global improvement of the PC and buying experience of customers and assistance in PC information and software purchases (“Microsoft Appoints David Porter as Corporate Vice President of Retail Stores”). Confrontations with Legal Issues In 1998, two anti-trust cases were filed against Microsoft by the U.S Department of Justice and 20 state lawyers. The company was accused of violating the Sherman Act; monopolizing the operating systems market and preventing software and hardware companies from using or selling products of rivals. Two years after, a ruling was made prompting the company to divide into two smaller companies in order to break its monopoly over the market. However, in 2001, the Justice Department agreed on a settlement with Microsoft instead of a division. In 2004, legal actions by the European Union against Microsoft for antitrust violations and abusive monopoly of the computer operating systems obliged the company pay a settlement of EUR 497 million or $596 million (“Microsoft Corporation – History”). Works Cited “A History of Windows.” Microsoft Corporation. 2010. 8 December 2010. Fried, Ina. “Microsoft follows Apple into the retail business.” CBS Interactive. 2009. 8 December 2010. “History of Microsoft.” Web Hosting Report. 2010. 8 December 2010. “Microsoft Appoints David Porter as Corporate Vice President of Retail Stores.” Microsoft News Center. 2010. 8 December 2010. “Microsoft Corporation – Company History.” International Directory of Company Histories,“ Vol.63. St. James Press, 2004. “Microsoft Corporation – History.” Columbia Link. 2010. 8 December 2010. “Microsoft Launches Windows Vista and Microsoft Office 2007 to Consumers Worldwide.” Microsoft News Center. 2007. 8 December 2010. Read More