Few people nowadays remember that
the IBM PC was not the first "personal computer" and that
MS-DOS was not the first industry standard operating system for microprocessors. In fact,
MS-DOS was but an imperfect copy of the operating system that really
has a claim to that title.
The first generation of personal computers (or microcomputers, as they were
known then) used chips like the Intel 8008, 8080, Zilog Z80, MOS Technology
6502 and Motorola 6800. While some early microcomputers (for example, the Apple II)
used proprietary operating systems, hundreds of different manufacturers licensed
a product called CP/M (as in Control Program / Monitor) made by a company
called Digital Research. Long before the IBM PC and its clones / compatibles, the
CP/M architecture provided for industry standard software that was portable across
hundreds of different brands and models. This was DRI founder Gary Kildall's main
contribution to the software industry. Microsoft simply followed in DRI's
footsteps. Much of the credit that people give to Bill Gates is really owed to
Gary Kildall and other visionaries, on whose ideas the Gates empire was founded.
Eventually, due to DRI's slow response to the challenge of new 16-bit processors
and due to superior marketing and smart, agressive and sometimes illegal business
decisions by Microsoft, DRI lost its dominant market position in the microcomputer market:
It should be remembered that the first version of MS-DOS was essentially a clone
of DRI's CP/M version 1.4 ported to the Intel 8086/88 (CP/M 2.2 was the more common
version by then already). SCP DOS (aka QDOS = "quick and dirty operating system")
as it was initially called was written by Tim Paterson of Seattle Computer Products,
a maker of an 8086 processor board for S-100 machines.
The new operating system was purchased by
Microsoft and licensed to IBM when DRI refused to sell all rights to CP/M-86 for
a song. Microsoft and IBM subsequently managed to get DRI to drop its threat of
a lawsuit about MS-DOS by agreeing to offer CP/M-86 as an alternative to IBM PC DOS
and leave the choice to the customers. What they didn't tell DRI was that they were
going to charge $240 for DRI's product but only $40 for Microsoft's.
DRI fought back by developing a multi-user version of its CP/M product called
MP/M, a multi-tasking version called Concurrent CP/M and a DOS compatible
multi-tasking version called Concurrent DOS. GEM, a Mac-look alike product
for Intel PCs, won significant market share long before Microsoft Windows
became a usable product and became the basis for the first DTP package for
PCs, Ventura Publisher (a 68K version of GEM survived for a number of years
on the Atari ST).
In 1987 DRI released the first version of DR DOS, a fully MS-DOS compatible
single-tasking operating system (of which I was one of the principal developers) that forced Microsoft to revise its
OEM pricing for MS-DOS, costing it hundreds of millions in lost revenue worldwide.
On August 6, 1989, Bill Gates wrote the following in an e-mail to Steve Ballmer:
"DOS being cloned has had a dramatic impact on our pricing for DOS.
I wonder if we would have it around 30-40% higher if it wasn't cloned.
I bet we would!"
It also forced the company to quickly develop and release versions 5 and 6
of MS-DOS after years of neglect, adding features provided earlier in DR-DOS
such as memory management, file transfer, a task switcher and disk compression.
The success of DR DOS led to Novell acquiring DRI. However, Novell founder
Ray Noorda soon changed his plans and decided not to compete in the desktop
OS market against Microsoft any more. Novell concentrated on networks and
never made full use of DRI's experience.
After Ray Noorda had to step down from the helm of Novell he set up a new
company, Caldera, which bought the rights to Novell's legacy operating
systems from its DRI acquisition. Caldera then filed a lawsuit against Microsoft
over its anti-competitive practices against DRI. Caldera's lawyers and their witness documented
ample evidence of the anti-competitive practices and dirty tricks that Microsoft
had used to drive its competitor out of the market. At the beginning of 2000
the lawsuit was settled out of court in return for Microsoft paying a reported
US$150-200 million to Caldera. Thus DR DOS, the product that I had helped develop,
cost Microsoft dearly, both while DR DOS was a healthy challenge to Microsoft's
virtual operating system monopoly and after Bill Gates had considered it dead
SCO pulps Caldera-MS trial archives