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Microsoft bought MS-DOS on July 27, 1981

On July 27, 1981, Gates fully licensed the "quick and dirty operating system" (QDOS) from a company called Seattle Computer Systems, according to The Register. That OS would later become known as MS-DOS.

Not that long before this historical purchase, IBM came a'knockin' at Microsoft's door, in search of a 16-bit OS to run on its early PCs. Microsoft apparently thought it wiser to buy an existing solution than to build its own, so at first it non-exclusively licensed what was then called 86-DOS, or QDOS, from Seattle Computer Systems. Shortly thereafter, on July 27, Microsoft dropped another $50,000 for the exclusive rights.

In about a month's time, the software shipped on an IBM PC, according to Gizmodo. Later, MS-DOS became a legendary early OS. Microsoft and IBM started cozying up to each other in a relationship that would span decades and shape the tech world. Gates (and Cofounder Paul Allen and lots of other Microsofters) got very rich.

The rest is history.

Al Sacco is content director of Future PLC's Mobile Technology Vertical, which includes AndroidCentral.com, iMore.com and WindowsCentral.com. He is a veteran reporter, writer, reviewer and editor who has professionally covered and evaluated IT and mobile technology, and countless associated gadgets and accessories, for more than a decade. You can keep up with Al on Twitter and Instagram.

26 Comments
  • I really loved it!! :)
  • Best $50,000 ever spent!!!!
  • It starts!
  • Breaking news
  • Wow.. Same as my birthday!
  • 🤓🤓🤓🤓
  • Happy Birthday man!!!
  • 🎂🎉🎆
  • Happy Birthday!
  • "Most"... "Made one of the most important purchases in the software giants storied history"
  • Loved the ending:') so touching😭
  • That was on my 1st birthday lol
  • I've read this story a few times over the years... Bill Gates was just very lucky. He was in the right place at the right time, at a time where the market really needed it. He was also very smart with good business skills and programming skills. If this other company got in touch with IBM (part of the story was that IBM tried to call them but, they never returned the call), Bill Gates would not of been the billionaire he is now. There is a book out about this whole story, I read it years ago, I forget the name... read it and know the real story.
  • The guy's name was Gary Kildall, the company was Digital Research, and the book was probably 'Accidental Empires' by 'Robert X. Cringely'. His operating system was called CP/M and it was the industry standard from the mid-70s to the early-80s. QDos was one of many CP/M clones.    Gary Kildall went on to become an alcoholic and died in a biker bar fight in 1994.
  • Thanks I think that was it.  I could see why Gary Kildall became a big alcoholic, could of been a billionare.
  • All I can think about is pirates of silicone valley.
  • Lol, silicone valley, where the valley girls go for implants...
  • "Pirates of Silicone Valley", it almost sounds like a movie title :) Maybe pitch it to WB :)
  • Bill Gates originally suggested to IBM that they go to Digital Research and get a license for CP/M to use in the IBM PC. Gary Kildall's wife Dorothy wouldn't sign a non-disclosure agreement so IBM went back to Gates, and the rest is history.
  • That's 100% correct.  I was a Microsoft employee then.  Gates arranged for IBM to visit DRI. IBM had the craziest NDA I ever saw.  A company had to sign the NDA before IBM would even tell them they were IBM. The company wasn't allowed to know who they were signing the agreement with until AFTER the agreement was signed.  Dorothy was not only Gary's wife she was also a lawyer and refused to sign.  IBM panicked and immediately flew back to Seattle.  No OS meant the IBM PC couldn't be built on time and the project would likely be cancelled.  Paul Allen - not Bill Gates - knew about QDOS so went and did a deal with SCP.  This is all well documented.  But here's something that's never been discussed in public before:  IBM had another, secret, Plan B, PC development project underway in Japan.  If the IBM Boca Raton group failed, IBM Japan would lead IBM's global PC effort with this second PC design.  This one used a Motorola 6809 CPU.  The IBM group in Boca were totally unaware of this.  In the end the Boca group succeeded, the PC was announced and the Japanese project was quietly killed off.
  • I have a box of Dos 3.0 still in the plastic...
  • Ah the good old days when you had to edit config.sys and autoexec.bat to free up literally 4-16kb of conventional RAM (yes, kilobytes!) so you could load the right combination of mouse/cd-rom/audio drivers. Dem' was the days, lol
  • Yeaah, everything seemed so much funnier in the 80's☺☺
  • Yeah, I like to say, if you don't know how to configure autoexec.bat and config.sys, and don't know how to assign ports, DMA, IRQ, so your devices can actually function, and do a low level HD format through DEBUG calls, then you cannot call yourself a true PC nerd. It's ridiculous how easy it is to slap together a PC nowadays. It's basically like putting Lego pieces together.
  • "Who would ever need more than 640K of RAM?" - Bill Gates, 1982
  • Good times!! Remeber spending days if not weeks, designing custom batch menu's. Money well spent MS!!