RESEARCH

ON

PRESENTED BY
BHUPENDRA KUMAR
ONKAR PRASAD
SANDEEP KUMAR SINGH
 introduction

Microsoft began using its current logo in Windows splash screens

with Windows 95.

Microsoft is a multinational computer technology corporation. The

history of Microsoft began on April 4, 1975, when it was founded by
Bill Gates and Paul Allen in Albuquerque.[1] Its current best-selling
products are the Microsoft Windows operating system and the
Microsoft Office suite of productivity software.

Starting in 1980, Microsoft formed an important partnership with

IBM that allowed them to bundle Microsoft's operating system with
computers that they sold, paying Microsoft a royalty for every sale. In
1985, IBM requested that Microsoft write a new operating system for
their computers called OS/2; Microsoft wrote the operating system,
but also continued to sell their own alternative, which proved to be in
direct competition with OS/2. Microsoft Windows eventually
overshadowed OS/2 in terms of sales. When Microsoft launched
several versions of Microsoft Windows in the 1990s, they had
captured over 90% market share of the world's personal computers.

The company has now become largely successful. As of 2008,

Microsoft has a global annual revenue of US$ 60.42 billion and
nearly 90,000 employees in 105 countries. It develops, manufactures,
licenses, and supports a wide range of software products for
computing devices.[2][3][4]
 Contents
 1 1975–1985: The founding of Microsoft
 2 1985–1991: The rise and fall of OS/2
 3 1992–1995: Domination of the corporate
market
 4 1995–1999: Foray into the Web and
other ventures
 5 2000–2005: Legal issues, XP, and .NET
 6 2005–present: Vista and other transitions
 7 See also
 8 References
1975–1985: The founding of Microsoft

Microsoft staff photo from December 7, 1978. From left to right:

Top: Steve Wood, Bob Wallace, Jim Lane.
Middle: Bob O'Rear, Bob Greenberg, Marc McDonald, Gordon Letwin.
Bottom: Bill Gates, Andrea Lewis, Marla Wood, Paul Allen.

After reading the January 1, 1975 issue of Popular Electronics that

demonstrated the Altair 8800, Bill Gates called the creators of a new
microcomputer, MITS (Micro Instrumentation and Telemetry Systems),
offering to demonstrate an implementation of the BASIC programming
language for the system.[5] Gates had neither an interpreter nor an Altair system,
yet in the eight weeks before the demo he and Allen developed the interpreter.
The interpreter worked at the demo and MITS agreed to distribute Altair
BASIC.[6] Gates left Harvard University, moved to Albuquerque, New Mexico,
where MITS was located, and founded Microsoft there. The name Microsoft (a
portmanteau of microcomputer and software), hyphenated in its early
incarnations, was first used in a letter from Gates to Allen on November 29,
1975,[6] and on November 26, 1976 the company was registered under that name
with the Secretary of State of New Mexico.[5] The company's first international
office was founded on November 1, 1978, in Japan, entitled "ASCII Microsoft"
(now called "Microsoft Japan"), and on November 29, 1979, the term,
"Microsoft" was first used by Bill Gates.[5] On January 1, 1979, the company
moved from Albuquerque to a new home in Bellevue, Washington.[5] Steve
Ballmer joined the company on June 11, 1980, and would later succeed Bill
Gates as CEO.[5] The company restructured on June 25, 1981, to become an
incorporated business in its home state of Washington (with a further change of
its name to "Microsoft, Inc."). As part of the restructuring, Bill Gates became
president of the company and Chairman of the Board, and Paul Allen became
Executive Vice President.[5]

The first operating system the company publicly released was a variant of Unix
in 1980. Acquired from AT&T through a distribution license, Microsoft dubbed
it Xenix, and hired Santa Cruz Operation in order to port/adapt the operating
system to several platforms.[7][8] This Unix variant would become home to the
first version of Microsoft's word processor, Microsoft Word. Originally titled
"Multi-Tool Word", Microsoft Word became notable for its concept of "What
You See Is What You Get", or WYSIWYG.

Word was also the first application with such features as the ability to display
bold text. It was first released in the spring of 1983, and free demonstration
copies of the application were bundled with the November 1983 issue of PC
World, making it the first program to be distributed on-disk with a magazine.[9]
However, Xenix was never sold to end users directly although it was licensed to
many software OEMs for resale. It grew to become the most popular version of
Unix, measured by the number of machines running it[10] (note that Unix is a
multi-user operating system, allowing simultaneous access to a machine by
several users). By the mid-1980s Microsoft had gotten out of the Unix business,
except for an interest in SCO.[7]

DOS (Disk Operating System) was the operating system that brought the
company its real success. On August 12, 1981, after negotiations with Digital
Research failed, IBM awarded a contract to Microsoft to provide a version of
the CP/M operating system, which was set to be used in the upcoming IBM
Personal Computer (PC). For this deal, Microsoft purchased a CP/M clone
called 86-DOS from Tim Paterson of Seattle Computer Products for less than
US$100,000, which IBM renamed to PC-DOS. Microsoft did not have an
operating system when they closed the deal with IBM and IBM hadn't done
their homework. Due to potential copyright infringement problems with CP/M,
IBM marketed both CP/M and PC-DOS for US$240 and US$40, respectively,
with PC-DOS eventually becoming the standard because of its lower price.[11][12]
Around 1983, in collaboration with numerous companies, Microsoft created a
home computer system, MSX, which contained its own version of the DOS
operating system, entitled MSX-DOS; this became relatively popular in Japan,
Europe and South America.[6][13][14] Later, the market saw a flood of IBM PC
clones after Columbia Data Products successfully cloned the IBM BIOS,
quickly followed by Eagle Computer and Compaq.[15][16][17][18] The deal with IBM
allowed Microsoft to have control of its own QDOS derivative, MS-DOS, and
through aggressive marketing of the operating system to manufacturers of IBM-
PC clones Microsoft rose from a small player to one of the major software
vendors in the home computer industry.[19] With the release of the Microsoft
Mouse on May 2, 1983, Microsoft continued to expand its product line in other
markets. This expansion included Microsoft Press, a book publishing division,
on July 11 the same year.

1985–1991: The rise and fall of OS/2

The sign at a main entrance to the Microsoft corporate campus. The Redmond
Microsoft campus today includes more than 8 million square feet (approx.
750,000 m²) and 28,000 employees.[20]

Ireland became home to one of Microsoft's international production facility in

1985, and on November 20 Microsoft released its first retail version of
Microsoft Windows (Windows 1.0), originally a graphical extension for its MS-
DOS operating system.[5] In August, Microsoft and IBM partnered in the
development of a different operating system called OS/2. OS/2 was marketed in
connection with a new hardware design proprietary to IBM, the PS/2.[21] On
February 16, 1986, Microsoft relocated to Redmond, Washington. Around one
month later, on March 13, the company went public with an IPO, raising US$61
million at US$21.00 per share. By the end of the trading day, the price had risen
to US$28.00. In 1987, Microsoft eventually released their first version of OS/2
to OEMs.[22]

Meanwhile, Microsoft began introducing its most prominent office products.

Microsoft Works, an integrated office program which combined features
typically found in a word processor, spreadsheet, database and other office
applications, saw its first release as an application for the Apple Macintosh
towards the end of 1986.[6] Microsoft Works would later be sold with other
Microsoft products including Microsoft Word and Microsoft Bookshelf, a
reference collection introduced in 1987 that was the company's first CD-ROM
product.[5][23] Later, on August 8, 1989, Microsoft would introduce its most
successful office product, Microsoft Office. Unlike the model of Microsoft
Works, Microsoft Office was a bundle of separate office productivity
applications, such as Microsoft Word, Microsoft Excel and so forth. While
Microsoft Word and Microsoft Office were mostly developed internally,
Microsoft also continued its trend of rebranding products from other companies,
such as Microsoft SQL Server on January 13, 1988, a relational database
management system for companies that was based on technology licensed from
Sybase.[5]

On May 22, 1990 Microsoft launched Windows 3.0.[6] The new version of
Microsoft's operating system boasted such new features as streamlined graphic
user interface GUI and improved protected mode capability for the Intel 386
processor; it sold over 100,000 copies in two weeks.[6][24] Windows at the time
generated more revenue for Microsoft than OS/2, and the company decided to
move more resources from OS/2 to Windows.[25] In an internal memo to
Microsoft employees on May 16, 1991, Bill Gates announced that the OS/2
partnership was over, and that Microsoft would henceforth focus its platform
efforts on Windows and the Windows NT kernel.[26] Some people, especially
developers who had ignored Windows and committed most of their resources to
OS/2, were taken by surprise, and accused Microsoft of deception. This
changeover from OS/2 was frequently referred to in the industry as "the head-
fake".[27][28] In the ensuing years, the popularity of OS/2 declined, and Windows
quickly became the favored PC platform. 1991 also marked the founding of
Microsoft Research, an organization in Microsoft for researching computer
science subjects, and Microsoft Visual Basic, a popular development product
for companies and individuals.[5]

1992–1995: Domination of the corporate market

The Microsoft sign at the entrance of the German Microsoft campus, Konrad-
Zuse-Str. 1, Unterschleißheim, Germany. Microsoft became an international
company with headquarters in many countries.

During the transition from MS-DOS to Windows, the success of Microsoft's

product Microsoft Office allowed the company to gain ground on application-
software competitors, such as WordPerfect and Lotus 1-2-3.[6][29] Novell, an
owner of WordPerfect for a time, alleged that Microsoft used its inside
knowledge of the DOS and Windows kernels and of undocumented Application
Programming Interface features to make Office perform better than its
competitors.[30] Eventually, Microsoft Office became the dominant business
suite, with a market share far exceeding that of its competitors.[31] In March
1992, Microsoft released Windows 3.1 along with its first promotional
campaign on TV; the software sold over three million copies in its first two
months on the market.[5][6] In October, Windows for Workgroups 3.1 was
released with integrated networking capabilities such as peer-to-peer file and
printing sharing.[6] In November, Microsoft released the first version of their
popular database software Microsoft Access.[6]

The Microsoft sign at the entrance of the Dubai Microsoft campus, Dubai
Internet City. Microsoft has developed Arabic versions for most of its products.

By 1993, Windows had become the most widely used GUI operating system in
the world.[6] Fortune Magazine named Microsoft as the "1993 Most Innovative
Company Operating in the U.S."[32] The year also marked the end of a five-year
copyright infringement legal case brought by Apple Computer, dubbed Apple
Computer, Inc. v. Microsoft Corp., in which the ruling was in Microsoft's favor,
the release of Windows for Workgroups 3.11, a new version of the consumer
line of Windows, and Windows NT 3.1, a server-based operating system with a
similar user interface to consumer versions of the operating system, but with an
entirely different kernel.[6] As part of its strategy to broaden its business,
Microsoft released Microsoft Encarta on March 22, 1993, the first encyclopedia
designed to run on a computer.[5] Shortly after, the Microsoft Home brand was
introduced - encompassing Microsoft's new multimedia applications for
Windows 3.x., Microsoft changed its slogan to "Where do you want to go
today?" in 1994 as part of an attempt to appeal to nontechnical audiences in a
US$100 million advertising campaign.[6]

Microsoft continued to make strategic decisions directed at consumers. The

company released Microsoft Bob, a graphical user interface designed for novice
computer users, in March 1995. The interface was discontinued in 1996 due to
poor sales; Bill Gates later attributed its failure to hardware requirements that
were too high for typical computers; Microsoft Bob is widely regarded as
Microsoft's most unsuccessful product.[33][34] DreamWorks SKG and Microsoft
formed a new company, DreamWorks Interactive (in 2000 acquired by
Electronic Arts which named it EA Los Angeles), to produce interactive and
multimedia entertainment properties.[5] On August 24, 1995, Microsoft released
Microsoft Windows 95, a new version of the company's flagship operating
system which featured a completely new user interface, including a novel start
button; more than a million copies of Microsoft Windows 95 were sold in the
first four days after its release.[6]

Windows 95 was released without a web browser as Microsoft had not yet
developed one. The success of the Internet caught them by surprise and they
subsequently approached Spyglass to license their browser as Internet Explorer.
Spyglass went on to later dispute the terms of the agreement, as Microsoft was
to pay a royalty for every copy sold. However, Microsoft sold no copies of
Internet Explorer, choosing instead to bundle it for free with the operating
system.

Internet Explorer was first included in the Windows 95 Plus! Pack that was
released in August 1995.[35] In September, the Chinese government chose
Windows to be the operating system of choice in that country, and entered into
an agreement with the Company to standardize a Chinese version of the
operating system.[6] Microsoft also released the Microsoft Sidewinder 3D Pro
joystick in an attempt to further expand its profile in the computer hardware
market.[6]

1995–1999: Foray into the Web and other ventures

On, May 26, 1995, Bill Gates sent the "Internet Tidal Wave" memorandum to
Microsoft executives. The memo described Netscape with their Netscape
Navigator as a "new competitor 'born' on the Internet." The memo outlines
Microsoft's failure to grasp the Internet's importance, and in it Gates assigns
"the Internet this highest level of importance" from then on.[36] Microsoft began
to expand its product line into computer networking and the World Wide Web.
On August 24, 1995, it launched a major online service, MSN (Microsoft
Network), as a direct competitor to AOL. MSN became an umbrella service for
Microsoft's online services, using Microsoft Passport (now called Windows
Live ID) as a universal login system for all of its web sites.[5][6][37] The company
continued to branch out into new markets in 1996, starting with a joint venture
with NBC to create a new 24/7 cable news station, MSNBC. The station was
launched on July 15, 1996 to compete with similar news outlets such as CNN.[6]
[38]
Microsoft also launched Slate, an online magazine edited by Michael
Kinsley, which offered political and social commentary along with the cartoon
Doonesbury.[5] In an attempt to extend its reach in the consumer market, the
company acquired WebTV, which enabled consumers to access the Web from
their televisions.[5] Microsoft entered the personal digital assistant (PDA) market
in November with Windows CE 1.0, a new built-from-scratch version of their
flagship operating system, specifically designed to run on low-memory, low-
performance machines, such as handhelds and other small computers.[39] 1996
saw the release of Windows NT 4.0, which brought the Windows 95 GUI and
Windows NT kernel together.[40]

While Microsoft largely failed to participate in the rise of the Internet in the
early 1990s, some of the key technologies in which the company had invested to
enter the Internet market started to pay off by the mid-90s. One of the most
prominent of these was ActiveX, an application programming interface built on
the Microsoft Component Object Model (COM); this enabled Microsoft and
others to embed controls in many programming languages, including the
company's own scripting languages, such as JScript and VBScript. ActiveX
included frameworks for documents and server solutions.[6] The company also
released the Microsoft SQL Server 6.5, which had built-in support for internet
applications.[6] Later in 1997, Microsoft Office 97 as well as Internet Explorer
4.0 were released, marking the beginning of the takeover of the browser market
from rival Netscape, and by agreement with Apple Computer, Internet Explorer
was bundled with the Apple Macintosh operating system as well as with
Windows.[6] Windows CE 2.0, the handheld version of Windows, was released
this year, including a host of bug fixes and new features designed to make it
more appealing to corporate customers.[39] In October, the Justice Department
filed a motion in the federal district court in which they stated that Microsoft
had violated an agreement signed in 1994, and asked the court to stop the
bundling of Internet Explorer with Windows.[5]

A Windows 98 desktop

The year 1998 was significant in Microsoft's history, with Bill Gates appointing
Steve Ballmer as president of Microsoft but remaining as Chair and CEO
himself.[5] The company released an update to the consumer version of
Windows, Windows 98.[5] Windows 98 came with Internet Explorer 4.0 SP1
(which had Windows Desktop Update bundled), and included new features
from Windows 95 OSR 2.x including the FAT32 file system, and new features
specifically for Windows 98, such as support for multiple displays.[41] Microsoft
launched its Indian headquarters as well, which would eventually become the
company's second largest after its U.S. headquarters.[6] Finally, a great deal of
controversy took place when a set of internal memos from the company were
leaked on the Internet. These documents, colloquially referred to as "The
Halloween Documents", were widely reported by the media and go into detail
of the threats that free software / open source software poses to Microsoft's own
software, previously voiced mainly by analysts and advocates of open source
software. The documents also allude to legal and other actions against Linux as
well as other open source software.[42][43] While Microsoft acknowledges the
documents, it claims that they are merely engineering studies. Despite this,
however, some believe that these studies were used in the real strategies of the
company.[44].

2000–2005: Legal issues, XP, and .NET

Bill Gates gives a presentation at IT-Forum in Copenhagen in 2004.

Microsoft, in 2000, released new products for all three lines of the company's
flagship operating system, and saw the beginning of the end of one its most
prominent legal cases. On February 17, 2000, Microsoft released an update to
its business line of software in Windows 2000, which some considered to be a
significant improvement over previous versions. It provided an OS stability
similar to that of its Unix counterparts due to its usage of the Windows NT
kernel, and matching features for several of those found in the home line of the
operating system including a DOS emulator that could run many legacy DOS
applications.[6] On April 3, 2000, a judgment was handed down in the case of
United States v. Microsoft,[45] calling the company an "abusive monopoly"[46]
and forcing the company to split into two separate units. Part of this ruling was
later overturned by a federal appeals court, and eventually settled with the U.S.
Department of Justice in 2001. On June 15, 2000 the company also released a
new version of its hand-held operating system, Windows CE 3.0.[39] The main
change was the new programming APIs of the software. Previous versions of
Windows CE supported only a small subset of the WinAPI, the main
development library for Windows, and with Version 3 of Windows CE, the
operating system now supported nearly all of the core functionality of the
WinAPI. The update to the consumer line, Windows Me (or Windows
Millennium Edition), was released on September 14, 2000.[5] It sported several
new features such as enhanced multimedia capabilities and consumer-oriented
PC maintenance options, but is often regarded as one of the worst versions of
Windows due to installation problems and other issues.[34][47]

Windows XP introduced a new interface, along with many other new features.
This screenshot shows Windows XP Professional.

Microsoft released Windows XP and Office XP in 2001, a version that aimed to

encompass the features of both its business and home product lines. The release
included an updated version of the Windows 2000 kernel, enhanced DOS
emulation capabilities, and many of the home-user features found in previous
consumer versions. XP introduced a new graphical user interface, the first such
change since Windows 95.[5][48] The operating system was the first to require
Microsoft Product Activation, an anti-piracy mechanism that requires users to
activate the software with Microsoft within 30 days. Later, Microsoft would
enter the multi-billion-dollar game console market dominated by Sony and
Nintendo, with the release of the Xbox.[5] The Xbox finished way behind the
dominant PlayStation 2 selling 24 million units compared to the PlayStation 2's
136 million however they managed to outsell the Nintendo Gamecube which
finished on 21 million units. Microsoft launched their second console the Xbox
360 in 2005 which has turned out to be a lot more successful then their first
console selling 40 million units as of 2010 and outselling Sony's PlayStation 3
which has so far sold 35 million. However despite beating them with their last
console Microsoft have so far been outsold by the Nintendo Wii which has
introduced motion control and has opened up a new market for video games.
Microsoft are hoping that their controller free experience Kinect which they will
release in November will help them take some of the Wii's 71 million
consumers so far as of 2010. [49]

In 2002, Microsoft launched the .NET initiative, along with new versions of
some of its development products, such as Microsoft Visual Studio.[5] The
initiative has been an entirely new development API for Windows
programming, and includes a new programming language, C#. Windows Server
2003 was launched, featuring enhanced administration capabilities, such as new
user interfaces to server tools.[6] In 2004, the company released Windows XP
Media Center Edition 2005, a version of Windows XP specifically designed for
multimedia capabilities, and Windows XP Starter Edition, a version of
Windows XP with a smaller feature set designed for entry-level consumers.[5]
However, Microsoft would encounter more turmoil in March 2004 when
antitrust legal action would be brought against it by the European Union for
allegedly abusing its market dominance (see European Union Microsoft
antitrust case). Eventually Microsoft was fined €497 million (US$613 million),
ordered to divulge certain protocols to competitors, and to produce a new
version of its Windows XP platform—called Windows XP Home Edition N—
that did not include its Windows Media Player.[50][51] Microsoft was also ordered
to produce separate packages of Windows after South Korea also landed a
settlement against the company in 2005. It had to pay out US$32 million and
produce more than one version of Windows for the country in the same vein as
the European Union-one with Windows Media Player and Windows Messenger
and one without the two programs.[52]

2005–present: Vista and other transitions

Windows Vista is one of Microsoft's latest client operating systems, which

features a new visual style, Windows Aero.

In guise of competing with other Internet companies such as the search service
Google, in 2005 Microsoft announced a new version of its MSN search service.
[53]
Later, in 2006, the company launched Microsoft adCenter, a service that
offers pay per click advertisements, in an effort to further develop their search
marketing revenue.[54] Shortly afterward, Microsoft created the CodePlex
collaborative development site for hosting open source projects. Activity grew
quickly as developers from around the world began to participate, and by early
2007 commercial open source companies, such as Aras Corp,.[55] began to offer
enterprise open source software exclusively on the Microsoft platform.

On June 15, 2006 Bill Gates announced his plans for a two year transition
period out of a day-to-day role with Microsoft until July 31, 2008. After that
date, Gates will continue in his role as the company's chairman, head of the
Board of Directors and act as an adviser on key projects. His role as Chief
Software Architect will be filled immediately by Ray Ozzie, the Chief
Technical Officer of the company as of June 15, 2006.[56] Bill Gates stated "My
announcement is not a retirement — it’s a reordering of my priorities."[57]

Formerly codenamed "Longhorn" in the early development stages, Windows

Vista was released to consumers on January 30, 2007.[58][59] Microsoft also
released a new version of its Office suite, called Microsoft Office 2007,
alongside Windows Vista. Windows Server 2008 and Visual Studio 2008, the
next versions of the company's server operating system and development suite,
respectively, have been released to manufacturing, and are scheduled to be
released on February 27, 2008.[60]

On December 19, 2007, Microsoft signed a five year, $500 million contract
with Viacom that included content sharing and advertisement. The deal allowed
Microsoft to license many shows from Viacom owned cable television and film
studios for use on Xbox Live and MSN. The deal also made Viacom a preferred
publisher partner for casual game development and distribution through MSN
and Windows. On the advertisement side of the deal, Microsoft's Atlas ad-
serving division became the exclusive provider of previously unsold advertising
inventory on Viacom owned web sites. Also, Microsoft also purchased a large
amount of advertising on Viacom owned broadcasts and online networks.
Finally, Microsoft will also collaborate on promotions and sponsorships for
MTV and BET award shows, two Viacom owned cable networks.[61]

In 2008, Microsoft wanted to purchase Yahoo (first completely, later partially)

in order to strengthen its position on the search engine market vis-à-vis Google.
[62][63]
The company rejected the offer, saying that it undervalued the company.
In response, Microsoft withdrew its offer.[citation needed]

In 2009, the opening show of the Consumer Electronics Show (CES) was
hosted by Steve Ballmer for the first time. In past years, it has been hosted by
Bill Gates. In the show, Ballmer announced the first public Beta Test of
Windows 7 for partners and developers on January 8, but also for general public
on January 10.
On June 26, 2009 Microsoft started taking pre-orders at a discounted price for
Windows 7 which was launched on October 22, 2009.