KE >> Gary Kildal messed up Digital Research's shot when IBM came to
KE >> discuss licensing CP/M as the OS for the IBM PC.
B.J. Smith > I know. He said he didn't do 8086, only 8080.
P. Foster> What about CP/M-86? Wasn't this available at the same time as
P. Foster> Gates was being courted by IBM? I got the impression that Kildal
P. Foster> simply didn't want to deal with IBM.
As I understand it, when IBM representitives handed Kildal a non-disclosure
agreement, he refused to sign it until his lawyer looked over. As his
lawyer studied the huge document, the IBM guys cooled their heels until it
was time to catch a plane. When they next met with Gate and Allen, they
mentioned the incident and asked who else might offer an x86 OS. Having
earlier realized that the OS vendor would have the opportunity of a
lifetime, and being aware of Seattle Microcomputer's DOS, Gates saw his
chance. He said that he might be able to come up with something for them.
He visited with Seattle Microcomputer, cut a deal for the source code for (I
heard) $60,000, changed the copyright to MS, and the name to MS-DOS, and
visited IBM in Boca Raton two weeks later. IBM, under the impression that
Gates/Allen wrote it in two week, and being offer a _non-exclusive_
royalty-free license for (I heard) $60,000, signed a contract quickly before
Gates could change his mind. IBM thought they had a OS far below their
budget. Cash-wise, it was a wash for MS. But (as we all know), the
non-exclusive part was the key. MS made money on everyone else but IBM.
Pretty smart move.
Oh, after he had IBM's cash, he signed the deal with Seattle Microcomputer
(as I understand it).
So, while Kildal slowly worked with details, Gates/Allen moved fast with an
inferior product that was (to some degree) a cheap copy. It worked.
Actually, I remember seeing both CP/M-86 AND PC-DOS on the IBM-PC price
list. I think CP/M-86 cost $350 or $450 and PC-DOS was $45. There were
more products for CP/M-86 (dBase, WordStar, Peachtree accounting, etc) but
Lotus 123 ran on DOS and that became the killer app. People were buying
Visicalc (the first spreadsheet) and any computer that would run it (mostly
Apple II's). Lotus 123 was a vastly superior product, requiring DOS and the
PC. Until then, PC sales were slow. 123 put the PC on the map. Once again,
right place, right time. Despite the cheaper price, if Lotus had written
123 for CP/M-86, I suspect history would have been quite different.
I just sent Mitchell Kapor an e-mail asking why he picked PC-DOS over
CP/M-86. Might be interesting to see what he says.
Ken Elliott
=====================
-----Original Message-----
From: slug@nks.net [mailto:slug@nks.net] On Behalf Of Paul M Foster
Sent: Sunday, September 26, 2004 9:46 AM
To: slug@nks.net
Subject: Re: [SLUG] Windows update
On Sat, Sep 25, 2004 at 08:04:32PM -0400, Bryan J. Smith wrote:
<snip>
> > Gary Kildal messed up Digital Research's shot when IBM came to
> > discuss licensing CP/M as the OS for the IBM PC.
>
> I know. He said he didn't do 8086, only 8080.
>
What about CP/M-86? Wasn't this available at the same time as Gates was
being courted by IBM? I got the impression that Kildall simply didn't want
to deal with IBM.
Paul
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