A Brief History of Microsoft


Microsoft Corporation, founded on 4th April 1975, is an American multinational computer technology company. It develops, produces, and sells a wide range of consumer and enterprise software systems, hardware, and services. Its best-known software products are the Windows line of operating systems and the Office suite of productivity applications, and its flagship hardware products are the Xbox video game consoles and the Surface series of hybrid tablet computers. Its extensive product portfolio also includes search (with Bing), digital services, operating system mobile apps, mixed reality (HoloLens), and cloud computing.

It was founded by Harvard College dropout Bill Gates and childhood friend Paul Allen. By the time of its IPO in 1986, it was one of America’s most profitable corporations and the world’s largest software maker. It commanded a dominant share of the IBM PC compatible operating system market and the office software market, outclassing longtime competitors Lotus and WordPerfect. In addition, it had a growing presence in the electronic gaming industry with the Xbox system and was an early leader in web browsers and mobile platforms.

In the mid-1990s, Microsoft expanded into hardware with a series of mouse and keyboard peripherals designed to work with its flagship products. It also diversified into the Internet, selling its own e-mail service and connecting millions of users to the World Wide Web for the first time with its Internet Explorer browser.

By the late 2000s, it had shifted its focus to the fast-growing markets of cloud computing, smartphones, and social networking. It had a strong presence in the smartphone operating system market with its Windows Phone, and it had become one of the world’s leading cloud service providers through its Azure platform. Its growth in these areas helped it to outpace its traditional software rivals, including Oracle and Salesforce.

Microsoft’s success also came with some baggage. For decades, it resisted partnerships, preferring to rely on its enormous cash and engineering resources instead. That stance had yielded enormous profits and helped it to dominate the PC market, but it was becoming obsolete in a rapidly changing industry.

With Nadella at the helm, Microsoft began to embrace the ideas that made startups successful. For example, it sponsored hackathons for engineers, where they worked on projects outside their day-to-day responsibilities. It also began to focus on customer usage data rather than sales, which can be a lagging indicator in fast-moving markets.

During the tax scandal, the IRS discovered that Microsoft had shifted $39 billion in profits to Puerto Rico, where it had employed KPMG to help it take advantage of loopholes. The agency concluded that the numbers the company had used to justify the transfer were laughable. Nevertheless, the company continued to employ KPMG until 2019.

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