Microsoft

Microsoft Corporation

(NASDAQ:MSFT)

Contact Information

Microsoft Corporation
1 Microsoft Way
Redmond, WA 98052-6399
WA Tel. 425-882-8080
Toll Free 800-642-7676
Fax 425-936-7329

Type: Public
On the web: http://www.microsoft.com
Employees: 90,000
Employee growth: 1.1%

Microsoft's ambitions are anything but small. The world's #1 software company develops and sells a variety of products used by consumers and businesses. Its core products are the ubiquitous Windows PC operating system and the Office business productivity application suite that is sold in part through PC makers such as Acer, Dell, Hewlett-Packard, and Toshiba, who pre-install the software on their devices. Microsoft also sells directly online and through resellers. It also makes video game consoles (Xbox), enterprise applications (Microsoft Dynamics), server and storage software, and digital music players (Zune). Other activities include online advertising, mobile software, and consulting and support services.

Key numbers for fiscal year ending June, 2011:
Sales: $69,943.0M
One year growth: 11.9%
Net income: $23,150.0M
Income growth: 23.4%

Officers:
Chairman: William H. (Bill) Gates III
CEO and Director: Steven A. (Steve) Ballmer
COO: B. Kevin Turner

Competitors:
Apple Inc.
Google
Oracle

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TechEncyclopedia:

Microsoft

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(Microsoft Corporation, Redmond, WA, www.microsoft.com) The most successful software company in the industry. Microsoft's software and Intel's hardware pioneered the PC and revolutionized the computer industry. Founded in 1975 by Bill Gates and Paul Allen, its Windows operating systems are the de facto standards on the desktop and major contenders in the server arena. Microsoft Office is the most successful application suite in history. The company also has a thriving business in programming languages, which are its roots, as well as in numerous other software categories.

Gates and Allen were two college students when they wrote the first BASIC interpreter for the Intel 8080 microprocessor. MBASIC was licensed to Micro Instrumentation and Telemetry Systems to accompany its Altair 8800 kit. By the end of 1976, more than 10,000 Altairs were sold, and versions were licensed to Radio Shack, Apple and others. Although the company became a leader in microcomputer programming languages, its outstanding success was caused by fitting IBM PCs with DOS in 1981 and non-IBM PCs with MS-DOS. In 1990, Windows 3.0, its third version of Windows, was enormously popular. Later, Windows 95 and Windows NT cemented Microsoft's leadership.

After the explosion of the Web, Microsoft worked feverishly to gain a foothold. By giving away its Internet Explorer browser and then integrating it into Windows 98, Internet Explorer became the leading on-ramp to the Internet. The Microsoft Network (MSN) ISP division is also a growing part of the company, and although many do not think of it as such, Microsoft is a very large hardware company. Its 2003 revenues for mice, keyboards, Xboxes and other devices exceeded five billion dollars. See Microsoft trial, Microsoft and IBM, Windows, DOS, Microsoft Office, Internet Explorer, Microsoftie and Altair.

William H. Gates, III

Bill Gates has become the most widely known business entrepreneur in the world, regardless of industry. (Image courtesy of Microsoft Corporation.)

The Microsoft Campus

This is the main building of the sprawling Microsoft campus. (Image courtesy of Microsoft Corporation.)

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Gale Directory of Company Histories:

Microsoft Corporation

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Company Perspectives:
To enable people and businesses throughout the world to realize their full potential.
Key Dates:
1975: Microsoft is founded by Bill Gates and Paul Allen; they sell BASIC, the first PC computer language program to MITS Computer, Microsoft's first customer.
1981: Microsoft, Inc. is incorporated; IBM uses Microsoft's 16-bit operating system for its first personal computer.
1982: Microsoft, U.K., Ltd. is incorporated.
1983: Paul Allen resigns as executive vice-president but remains on the board; Jon Shirley is made president of Microsoft (he later becomes CEO); Microsoft introduces the Microsoft Mouse and Word for MS-DOS 1.00.
1985: Microsoft and IBM forge a joint development agreement.
1986: Microsoft stock goes public at $21 per share.
1987: The company's first CD-ROM application, Microsoft Bookshelf, is released.
1990: Jon Shirley retires as president and CEO; Michael R. Hallman is promoted in Shirley's place; the company becomes the first PC software firm to surpass $1 billion of sales in a single year.
1992: Bill Gates is awarded the National Medal of Technology for Technological Achievement.
1993: The company introduces Windows NT.
1995: Bill Gates publishes his first book, The Road Ahead.
1996: The company acquires Vermeer Technologies and its software application, FrontPage.
1997: The Justice Department alleges that Microsoft violated a 1994 consent decree concerning licensing the Windows operating system to computer manufacturers.
1998: The U.S. Department of Justice files two antitrust cases against Microsoft, alleging the company had violated the Sherman Act.
2000: The company acquires Visio Corporation, its largest acquisition to date.
2001: Microsoft Windows XP is released internationally.
2003: Microsoft launches Windows Server 2003.

Incorporated: 1981 as Microsoft, Inc.
NAIC: 511210 Software Publishers; 511130 Book Publishers; 334111 Electronic Computer Manufacturing; 334119 Other Computer Peripheral Equipment Manufacturing; 423990 All Other Durable Goods Merchant Wholesalers; 443120 Computer and Software Stores; 551112 Offices of Other Holding Companies; 541613 Marketing Consulting Services; 541618 Other Management Consulting Services

With annual revenues of more than $32 billion, Microsoft Corporation is more than the largest software company in the world: it is a cultural phenomenon. The company's core business is based on developing, manufacturing, and licensing software products, including operating systems, server applications, business and consumer applications, and software development tools, as well as Internet software, technologies, and services. Led by Bill Gates, the world's wealthiest individual and most famous businessman, Microsoft has succeeded in placing at least one of its products on virtually every personal computer in the world, setting industry standards and defining markets in the process.

Bill Gates was born in Seattle in 1955, the second of three children in a well-to-do family. His father, William H. Gates II, was a lawyer, while his mother, Mary Gates, was a teacher, a regent of the University of Washington, and member of several corporate boards. Gates was first exposed to computers at school in the late 1960s with his friend Paul Allen, the son of two Seattle librarians. By the time Gates was 14, the two friends were writing and testing computer programs for fun and profit.

In 1972 they established their first company, Traf-O-Data, which sold a rudimentary computer that recorded and analyzed traffic data. Allen went on to study computer science at the University of Washington and then dropped out to work at Honeywell, while Gates enrolled at Harvard. Inspired in 1975 by an issue of Popular Electronics that showed the new Altair microcomputer kit just released by MITS Computer, Gates and Allen wrote a version of BASIC for the machine. Later that year Gates left college to work full time developing programming languages for the Altair, and he and Allen relocated to Albuquerque, New Mexico, to be near MITS Computer, where Allen took a position as director of software development. Gates and Allen named their partnership Micro-soft. Their revenues for 1975 totaled $16,000.

A year later, Gates published "An Open Letter to Hobbyists" in the Altair newsletter, in which he enjoined users to avoid illegally copied software. Arguing that software piracy prevented "good software from being written," Gates wrote prophetically, "Nothing would please me more than being able to hire ten programmers and deluge the hobby market with good software." In November 1976 Allen left MITS to devote his full attention to Microsoft, and the company's tradename was registered. In 1977 Apple and Radio Shack licensed Microsoft BASIC for their Apple II and Tandy computers, with the Apple license going for a flat fee of $21,000. As Apple sold a million machines complete with BASIC, Microsoft's unit revenues dropped to two cents a copy.

That same year Microsoft released its second programming language, Microsoft FORTRAN, which was followed in 1978 by a version of COBOL. Both were written for the CP/M operating system, one of many available in the rapidly expanding but still unstandardized microcomputer market. As CP/M was adopted by computer manufacturers including Sirius, Zenith, and Sharp, Microsoft became the leading distributor for microcomputer languages. By the end of 1978 Microsoft had 13 employees, a sales subsidiary in Japan, and $1 million in revenues. The following year Gates and Allen moved the company to Bellevue, Washington.

Microsoft's big break came in 1980 as IBM began developing its Personal Computer, or PC. While IBM contracted Microsoft to develop languages for the PC, IBM's first choice to provide an operating system was the leader in the field, Digital Research; however, IBM and Digital Research were unable to agree on terms, so the contract for the operating system was awarded to Microsoft. As Microsoft was under a tight deadline and did not have an operating system of its own, the company purchased the rights to one from Seattle Computer Products for $75,000. Originally dubbed Q-DOS (for "Quick and Dirty Operating System"), the product was renamed MS-DOS (for "Microsoft Disk Operating System") and modified for IBM's purposes. Under the terms of the agreement, Microsoft retained the right to sell the operating system to other companies and to consumers, while IBM could not. Neither company could have foreseen the value of this arrangement: as other manufacturers developed hardware compatible with the IBM PC, and as personal computing became a multibillion-dollar business, the fast and powerful MS-DOS became the industry's leading operating system, and Microsoft's revenues skyrocketed.

The year 1980 also saw the arrival of Steve Ballmer, a close friend of Gates from Harvard, who was hired to organize the non-technical side of the business. Ballmer later recalled the company's stormy beginnings under Gates's leadership: "Our first major row came when I insisted it was time to hire 17 people. He claimed I was trying to bankrupt him." Conservative in his spending, Gates dictated that the company must always have enough money in the bank to operate for a year with no revenues. Nearly 20 years later that policy still stood--in 1999 Microsoft had cash reserves of more than $13 billion and no long-term debt--while Ballmer, who had by then become Microsoft president, remained Gates's closest friend and adviser.

In 1981 the company was incorporated as Microsoft, Inc., with Gates as president and chairman and Allen as executive vice-president. The company closed the year with 128 employees and revenues of $16 million. Two years later Allen left Microsoft after being diagnosed with Hodgkin's disease. He remained on the board of directors and continued to hold more than 10 percent of the company's stock. Also in 1983 Microsoft launched a word processing program, Word 1.0, in an effort to supplant the category leader, WordStar. Simpler to use and less expensive than WordStar, Word used a mouse to move the cursor and was able to display bold and italic type on the screen. Nevertheless, some users felt that the product was too complex--designed for software engineers rather than business users--and it was quickly surpassed in the market by WordPerfect, released by the WordPerfect Corporation. Word did not become a success until its greatly improved version 3.0 was released in 1986, whereupon the application became Microsoft's best-selling product.

Throughout its history, Microsoft has been known for releasing products that were initially unsuccessful but eventually grew to dominate their categories. Many reviewers have been harsh in their criticism: David Kirkpatrick, writing in Fortune, described the first release of one product as a "typically unreliable, bug-ridden Microsoft mess," while Brent Schlender noted in the same magazine that "from its beginnings, Microsoft has been notorious for producing inelegant products that are frequently inferior and bringing them to the market way behind schedule." These critics note that the success of Microsoft has been based not only--or even principally--on the company's technological prowess, but also on Bill Gates's business acumen, which combined dogged perseverance, strategic marketing, powerful alliances, and, increasingly as the years went on, highly aggressive competitive tactics.

Microsoft worked closely with Apple during the development of Apple's Macintosh computer, which was introduced in 1984. Revolutionary in its design, the Mac featured a graphical user interface based on icons rather than the typed commands used by the IBM PC, making its programs simple to use and easy to learn, even by computer novices. Microsoft introduced Mac versions of BASIC, Word, and the spreadsheet program Multiplan, and quickly became the leading supplier of applications for the Mac. Revenues jumped from $50 million in 1983 to nearly $100 million in 1984.

Convinced that the Mac's graphical user interface represented the future of end-user applications, Gates sought to develop an interface manager to work on top of MS-DOS that would convert the operating system to a graphical model that would be user-friendly and provide a single method for interacting with the many non-standardized programs designed to run on the system. Because other companies, including IBM, were working to develop similar interface managers for MS-DOS, Gates solicited support from hardware manufacturers and software publishers who were concerned about IBM's continued dominance of the PC market. Compaq, Hewlett-Packard, Texas Instruments, Digital Equipment Corporation, and others announced their support for the project, called Microsoft Windows, while IBM, in the face of this opposition, threw its weight behind VisiOn, a similar product already being marketed by VisiCalc, while working to develop its own program, called TopView. Plagued by delays in development, the release of Windows was repeatedly rescheduled throughout 1984 and 1985, causing tensions at Microsoft and with other software publishers who were forced to delay releases of the applications they were designing for the system. Finally released in November 1985, after some 110,000 hours of frantic work by programmers, Windows faced a disappointing reception. The system was slow, few applications were available to run on it, and customers delayed purchase decisions while waiting for the introduction of TopView.

In 1985 Microsoft also introduced Excel 1.0, a Mac spreadsheet product. Based on the earlier and less successful Multiplan, Excel gradually took hold against its principal competitor, Lotus 1-2-3, and eventually came to account for more than $1 billion of Microsoft's annual revenues. That same year Microsoft began collaborating with IBM on a next-generation operating system, called OS/2.

In early 1986 Microsoft moved to a new 40-acre corporate campus in Redmond, Washington, near Seattle. Designed to provide a refuge free of distractions for those whose job was, in Gates's words, to "sit and think," the campus was nestled in a quiet woodland setting and reflected huge expenditures for tools, space, and comfort. Buildings were designed in the shape of an X to maximize light, with each programmer given a private office rather than a cubicle. The buildings featured many small, subsidized cafeterias, as well as refrigerators stocked with juice and caffeinated beverages. The self-contained, collegiate surroundings were carefully designed to promote the company's distinctive culture, which one commentator described as a close approximation of "math camp." Like most software companies, Microsoft had no dress code (although company lore recounts that in 1988 senior management did express a preference that employees not go barefoot indoors). Employees were hired on the basis of sheer intelligence, with the company selecting only a small fraction of applicants from the more than 100,000 resumes it received each year, and were expected to work brutal schedules to bring products to market as quickly as possible. Microsoft paid salaries that were distinctly lower than elsewhere in the industry, even to their senior executives, but compensated with generous stock options that made thousands of Microsoft employees millionaires. At the same time, the company tried to maintain a small company mentality, in which executives traveled coach class, the necessity of additional staff positions was closely scrutinized, and other unnecessary expenditures were vigilantly avoided.

In March 1986 Microsoft held an initial public offering (IPO) of 2.5 million shares which raised $61 million. Within a year the stock had risen from $25 to $85, making Bill Gates a billionaire at the age of 31. The following year Microsoft released its first CD-ROM product, Microsoft Bookshelf, a collection of ten reference works, as well as Excel for Windows, its first application for the new operating system. Microsoft also purchased Forethought, Inc., for $12 million, thereby acquiring that company's PowerPoint presentation graphics program, and released OS/2 in collaboration with IBM. In November 1987 Microsoft introduced Windows 2.0, a greatly improved version of the operating system, and by the end of the year Windows had sold more than one million copies. As Windows began to take hold, more software companies were convinced to develop applications for the operating system, which brought it increased usefulness and further sales momentum. In 1988 Microsoft surpassed Lotus Development Corporation as the leading software vendor, with more than $500 million in sales. The company was accused of copyright infringement by Apple, which alleged that Microsoft had copied the "look and feel" of the Macintosh, in a lawsuit that was finally dismissed after five years of litigation. In 1989 the company introduced Microsoft Office, a "suite" of programs that eventually came to dominate the market and become Microsoft's best-selling application product. While the initial release of Office was a discount package, later versions incorporated standard, shared features and included Word, Excel, PowerPoint, and the e-mail program Mail, with the Access database management program included in the Office Professional version.

Before 1990 Microsoft was primarily a supplier to hardware manufacturers, but after 1990 the bulk of the company's revenues came from sales to consumers. That year Microsoft became the first software company to reach $1 billion in revenues, closing the year with 5,600 employees.

In 1993 Microsoft introduced Encarta, the first multimedia encyclopedia on CD-ROM, as well as the first version of Windows NT, an operating system for users on corporate networks. While the initial acceptance of Windows NT was disappointing, an upgrade shipped in September of the following year as NT 3.5 was a dramatic success: winning the PC Magazine award for technical excellence in system software and named the best operating system product of 1994, the upgrade boosted sales of NT to more than one million copies by the end of the year. Microsoft announced an agreement to purchase Intuit, the producer of the leading package of personal financial software, called Quicken; however, after the U.S. Department of Justice filed suit to prevent the takeover on the basis of antitrust concerns, Microsoft withdrew its offer. Revenues for 1994 exceeded $4 billion.

In August 1995 Microsoft launched its next version of Windows, called Windows 95, which sold more than one million copies in the first four days after its release. For the rest of the decade Microsoft expanded aggressively into new businesses associated with its core franchise. Its projects included two joint ventures with the National Broadcasting Company under the name MSNBC: an interactive online news service and a cable channel broadcasting news and information 24 hours a day. The company's web-based services included the Microsoft Network online service, a travel agency, local events listings, car buying information, a personal financial management site, and a joint venture with First Data that allowed consumers to pay their bills online. Microsoft purchased 11 percent of the cable television company Comcast for $1 billion and cut a licensing deal with the largest U.S. cable operator, TCI Communications, to put Windows into at least five million set-top boxes. The company also purchased WebTV, whose core technology allowed users to surf the Internet without a PC. Microsoft's latest generation of Windows, Windows CE, was designed to expand the franchise into computer-like devices including mobile phones, point-of-sale terminals, pocket organizers, digital televisions, digital cameras, handheld computers, automobile multimedia systems, and pagers. By early 1999 the company had secured more than 100 licensing agreements with manufacturers of these "intelligent appliances."

Microsoft's many critics believed that the company's goal in this widespread expansion was to control every delivery channel of information, thereby providing the means to control the content. According to Scott McNealy of rival company Sun Microsystems, "By owning the entry points to the Internet and electronic marketplace, Microsoft has the power to exercise predatory and exclusionary control over the very means for people to access the Internet and all it represents."

The U.S. government apparently agreed. After an intensive investigation of Microsoft's competitive practices that had gone on for much of the decade, in 1998 the U.S. Department of Justice and a group of 20 state attorneys general filed two antitrust cases against Microsoft alleging violations of the Sherman Act. The government sought to prove a broad pattern of anticompetitive behavior on Microsoft's part by demonstrating an array of claims, including the following: that Microsoft had a monopoly on the market for operating systems; that the company used that monopoly as a means of preventing other companies from selling its competitors' products (most notably Netscape's Internet browser); that it was illegal for Microsoft to bundle its own browser into the operating system Windows 98 as a means of precluding customers from purchasing Netscape's product; that the company sought to divide markets with competitors; that Microsoft sought to subvert the Java programming language, developed by Sun Microsystems, which it viewed as a threat to Windows; and, finally, that Microsoft's business practices were detrimental to consumers. The case was conducted under a flurry of media attention, with all parties agreeing that the stakes were extremely high: should Microsoft win, its brand of extremely aggressive capitalism would secure a legal blessing; should the company lose, the company could be forced to license the source code for Windows to competitors, thus destroying its monopoly, or could be broken up into smaller components, crippling its hold over the marketplace.

The fear and resentment that Microsoft and its founder Gates engendered were testament to the company's mythic status and Gates's role as the embodiment of the digital era. Gates's extreme wealth (in early 1999 he was worth $50 billion) made him the subject of constant scrutiny, while the Internet was rife with Bill Gates "hate pages," named, for example, "The Society for the Prevention of Bill Gates Getting Everything." Resentment and legal action notwithstanding, with more than $14 billion in sales in 1998, Microsoft showed no signs of slowing down.

Microsoft continued to grow rapidly, increasing its net revenue by 29 percent, to $19.7 billion, in 1999. Additionally, net income rose to $7.79 billion, a dramatic 73 percent increase over 1998. While the antitrust suit against Microsoft showed threats of a forced breakup of Microsoft, innovations in the company continued. Encarta Africana, the first complete encyclopedia of black history and culture, was launched, as well as Shop, Microsoft's first online store.

In 2000 Microsoft acquired Visio Corporation, the top supplier of business diagramming and technical drawing software. The transaction, at approximately $1.3 billion, became the largest acquisition in Microsoft history. Also in 2000, Microsoft invested $135 million in the software publisher Corel. Apparently, Corel negotiated the investment, offering to drop "certain legal actions" it had against the company, even as it had no legal claims filed against Microsoft. Another transaction--in Microsoft's desire to expand into the television market--involved a $56 million investment in Intertainer Inc, a provider of video-on-demand service. In the same year, Microsoft increased its employee base by nearly 9,000, from 39,170 to 48,030. The total expenditures took a temporary toll on Microsoft's net income, which dropped 22 percent, to $7.35 billion, in 2001. At the same time, net revenue continued to increase, up 10 percent from 2000.

The release of Windows 2000, while causing a stir, was overshadowed by the highly anticipated debut and worldwide release of Microsoft Windows XP. So confident was Microsoft in the product, and in its ability to boost worldwide sales of computers (which had declined 11.3 percent since the September 11 attacks just a month before), they launched a $250 million ad campaign for the product. The software did not represent a brand new development, as much of the technology came from that of its predecessor, Windows 2000. But as Paul Thurrott, writer for Network Windows magazine, wrote, "There's no doubt that we'll eventually look back on Windows XP as one of the key OS releases of all time."

Meanwhile, the Department of Justice ruled that they would not enforce a breakup of Microsoft. By the end of 2002, the U.S. District Court approved the settlement Microsoft reached with the Justice Department. The settlement included preventing Microsoft from benefiting from exclusive deals that could hinder competition; uniform contract terms for computer manufacturers; the required ability of customers to remove icons from certain Microsoft features; and a requirement that Microsoft release specific innovational technical information to its rivals, in order to enforce competition.

Microsoft's net revenue increased to $28.37 billion in 2002, while net income rebounded, gaining 6 percent from the previous year. In 2003, Microsoft saw an impressive 28 percent jump in net income, to reach just below $10 billion. The launching of Windows Server 2003, the largest software development project in the company's history to date, contributed to the growth. According to Microsoft, Windows Server 2003 would be a more reliable, more manageable, and more collaborative piece of software. Security would also be tighter, especially due to a newly built IIS (Internet Information Server) Web Server.

By 2004, with more than 56,000 employees and anticipated year-end revenues of up to $38 billion, Microsoft continued to hold a strong lead in the computer software industry. With an emphasis on continuous innovation--including such business products as the BizTalk Server 2004--further success seemed ensured. Still, resentment toward Microsoft was omnipresent. In April 2004, the company was fined by the European Union for abusing its monopoly on computer operating systems. The fine, at EUR 497 million ($596 million), was not likely to be the last for Microsoft.

Principal Subsidiaries

Microsoft Asia, Ltd. (Nevada); Microsoft Business Solutions Aps (Denmark); Microsoft Capital Group, L.P.; Microsoft E-Holdings, Inc.; Microsoft Finance Company Ltd. (Ireland); Microsoft Ireland Capital Ltd.; Microsoft Ireland Operations Ltd.; Microsoft Licensing, Inc.; Microsoft Manufacturing BV (Netherlands); Microsoft T-Holdings, Inc.; MSLI, GP; Round Island, LLC; Round Island One Ltd.

Principal Divisions

Client; Server & Tools; Information Worker; Business Solutions; MSN; Mobile and Embedded Devices; Home and Entertainment; Other.

Principal Competitors

Apple Computer, Inc.; Hewlett-Packard Company; International Business Machines Corporation; Logitech International SA; Novell, Inc.; Sony Corporation; Sun Microsystems, Inc.; Time Warner Inc.; Yahoo! Inc.

Microsoft

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The world’s leading software-producing company, headquartered in Redmond, Washington, and founded by William Gates and Paul Allen in 1975. Among its early products were BASIC and MS-DOS (marketed to IBM for use in its computers as PC-DOS). For further information see http://www.microsoft.com.

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The Jargon File's Guide to Hacker Slang:

Microsoft

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The new Evil Empire (the old one was IBM). The basic complaints are, as formerly with IBM, that (a) their system designs are horrible botches, (b) we can't get source to fix them, and (c) they throw their weight around a lot. See also Halloween Documents.

Gale Encyclopedia of US History:

Microsoft

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Founded in 1975, the Microsoft Corporation rose from having no assets to become one of the most valuable companies in the world, and in 2003 was the largest computer software company and one of the great success stories in American business.

The roots of the company go back to 1968, when the Lakeside Academy acquired access to a computer in downtown Seattle. Computer programming fired the imaginations of Bill Gates and Paul Allen, then thirteen and fifteen years old. At the time, access to computers was expensive. They took on local programming jobs to pay for more computer time. In 1971, they wrote a program called Traf-O-Data, analyzing patterns of traffic flow. This project earned them $20,000. The next opportunity to turn their skills into income was a major turning point. In 1974, Management Information Tools, Inc. (MITI), published an advertisement for the first mass-produced home computer, called the MITS Altair. The machine was primitive by today's standards. It took a soldering iron and hours of patience to assemble. Once assembled, it could only be programmed with the 1s and 0s of machine code, requiring the programmer to set toggle switches at the front of the machine.

Despite these limitations, Gates and Allen saw the potential of personal computing. But first, it had to be made practical for the non specialist. Their solution was to write a compact version of the BASIC language that could be loaded into the Altair's memory from tape. Once loaded, the program understood and responded to simple, quasi-English commands in BASIC, using a Teletype machine to communicate. To complete negotiations with MITI, Gates and Allen formed a partnership they called Micro Soft, for microcomputer software. They later dropped the hyphen. As other companies produced personal computers of their own, Gates persuaded them to use Microsoft's BASIC. Microsoft hired additional programmers as it produced other languages for the new machines.

Bill Gates attended Harvard while trying to run the fledgling company. He had planned to major in law. Shortly, however, he quit to focus on the company fulltime. While at Harvard, he met Steve Ballmer, a business major who would eventually join the company and later become its chief executive officer.

Microsoft's next triumphs came in the area of operating systems. An operating system is a resident program that enables a user to load, manage, and run other programs; it provides the computer's general look and feel.

In 1981, the International Business Machines Corporation (IBM) released its personal computer, or "PC." Microsoft grew tremendously after acquiring the MSDOS operating system and licensing it to IBM. (Gates paid a programmer named Tim Patterson $50,000 for the system, although Microsoft added refinements.) IBM did not insist on exclusive rights to the software. As a hardware company, it believed that more money was to be made selling machines. Microsoft was therefore able to license the system to all the IBM "clones" and so reap hundreds of millions of dollars. The de facto designer of the PC environment became Microsoft in conjunction with chipmaker Intel. The main competition remaining in the personal computer market was Apple—although Microsoft also wrote the most popular applications for the Apple Macintosh.

Along with Apple, Microsoft saw the value of graphical user interface (GUI), using pictures, menus, and icons, instead of typed-in commands. While continuing to expand into many areas, Microsoft worked for years on a GUI operating system for IBM PCs and clones (now just known as PCs). That system was Windows, released in 1985. At first a failure—clumsy and awkward compared to the Macintosh—Windows eventually succeeded. Windows 3.0 was easy to use and took advantage of improvements in PC hardware, such as superior graphics, that had occurred since Windows 1.0. Microsoft also released a new version of BASIC—Visual Basic—making it easy to write programs for Windows.

Eventually, 90 percent of all personal computers ran Windows, and the leading applications (including word processing, database, and spreadsheets) were also Microsoft products. In the mid-1990s, it seemed that the emerging Internet might give rivals a chance to supplant Microsoft, whose software had always been based on the single-user model. By the late 1990s, however, Microsoft's integration of Internet technology into its products helped secure its dominance. Meanwhile, the company continued to devote its large research budget to new areas, such as interactive television.

But on 7 June 2000, the confidence and persistence that had served Microsoft in the past threatened to damage it, as Judge Thomas Penfield Jackson ordered the breakup of the company in a suit brought by the U.S. Justice Department and a number of states. The suit charged that Microsoft had an operating-system monopoly in Windows, which it exploited to its advantage in other product lines. Jackson reasoned that if Microsoft was two companies, the applications division could not take advantage of close ties to the designers of Windows. In the summer of 2001, an appellate panel overturned this penalty as too severe (citing Jackson's bias, as revealed in published interviews) and sent the case back to a lower court for rehearing.

Bibliography

Andrews, Paul. How the Web Was Won: Microsoft from Windows to the Web: The Inside Story of How Bill Gates and His Band of Internet Idealists Transformed a Software Empire. New York: Random House, 1999.

Ichbiah, Daniel, and Susan L. Knepper. The Making of Microsoft: How Bill Gates and His Team Created the World's Most Successful Software Company. New York: St. Martin's, 1991.

Manes, Stephen, and Paul Andrews. Gates: How Microsoft's Mogul Reinvented an Industry—and Made Himself the Richest Man in America. New York: Doubleday, 1993.

Microsoft Corporation. Inside Out: Microsoft—In Our Own Words. New York: Warner Books, 2000.

Wallace, James, and Jim Erickson. Hard Drive: Bill Gates and the Making of the Microsoft Empire. New York: Wiley, 1992.

AMG AllGame Guide: Game Companies:

Microsoft Corporation

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Company Bio

Founded in 1975 by Bill Gates and Paul Allen, Microsoft's mission has been to create software for the personal computer that empowers and enriches people in the workplace, at school and at home. As the world's leading software provider, Microsoft strives to produce innovative products that meet customers' evolving needs.

Microsoft products include the MS-DOS and Windows operating systems for personal computers, server applications for client/server environments, business and consumer productivity applications, interactive media programs, and Internet platform and development tools. Microsoft also offers online services, sells personal computer books and input devices, and researches and develops advanced technology software products. Microsoft products, available in more than 30 languages and sold in more than 50 countries, are available for most PCs, including Intel microprocessor-based computers and Apple computers.

Microsoft's games group is responsible for the best-selling Microsoft Flight Simulator, Close Combat and Age of Empires series, and a variety of sports titles, including Microsoft Golf, NFL Fever 2000 and NBA Inside Drive 2000.

In March 2000, Microsoft announced their intention to enter the console market with the Xbox, a platform based on advanced PC architecture. The new system launched November 15, 2001.

~ All Game Guide

Developed/Manufactured

Wikipedia on Answers.com:

Microsoft

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Coordinates: 47°38′22.55″N 122°7′42.42″W / 47.6395972°N 122.12845°W / 47.6395972; -122.12845

Microsoft Corporation

Type	Public
Traded as	NASDAQ: MSFT SEHK: 4338 Dow Jones Industrial Average Component NASDAQ-100 Component S&P 500 Component
Industry	Computer software Consumer electronics Digital distribution Computer hardware Video games IT consulting Online advertising Retail stores Automotive software
Founded	Albuquerque, New Mexico, United States (April 4, 1975 (1975-04-04))
Founder(s)	Bill Gates, Paul Allen
Headquarters	One Microsoft Way, Redmond, Washington, U.S.
Area served	Worldwide
Key people	Steve Ballmer (CEO) Bill Gates (Chairman)
Products	See products listing
Services	See services listing
Revenue	US$ 69.94 billion (2011)
Operating income	US$ 27.16 billion (2011)
Profit	US$ 23.15 billion (2011)
Total assets	US$ 108.7 billion (2011)
Total equity	US$ 57.08 billion (2011)
Employees	92,000 (2011)
Subsidiaries	List of Microsoft subsidiaries
Website	Microsoft.com

Microsoft Corporation (NASDAQ: MSFT) is an American multinational corporation headquartered in Redmond, Washington, United States that develops, manufactures, licenses, and supports a wide range of products and services predominantly related to computing through its various product divisions. Established on April 4, 1975 to develop and sell BASIC interpreters for the Altair 8800, Microsoft rose to dominate the home computer operating system market with MS-DOS in the mid-1980s, followed by the Microsoft Windows line of operating systems.

Microsoft would also come to dominate the office suite market with Microsoft Office. The company has diversified in recent years into the video game industry with the Xbox and its successor, the Xbox 360 as well as into the consumer electronics and digital services market with Zune, MSN and the Windows Phone OS. The ensuing rise of stock in the company's 1986 initial public offering (IPO) made an estimated three billionaires and 12,000 millionaires from Microsoft employees (Forbes 400 list revealed that in March 2011 both Jon Shipley and Nathan Myhrvold lost their billionaire status). In May 2011, Microsoft Corporation acquired Skype Communications for $8.5 billion.^[1]

Primarily in the 1990s, critics^[who?] contend Microsoft used monopolistic business practices and anti-competitive strategies including refusal to deal and tying, put unreasonable restrictions in the use of its software, and used misrepresentative marketing tactics; both the U.S. Department of Justice and European Commission found the company in violation of antitrust laws.^{[citation needed]} Known for its interviewing process with obscure questions, various studies and ratings were generally favorable to Microsoft's diversity within the company as well as its overall environmental impact with the exception of the electronics portion of the business.^{[citation needed]}

Contents

1 History
2 Product divisions
3 Culture
4 Criticism
5 Corporate affairs
6 See also
7 References
8 External links

History

Main articles: History of Microsoft and History of Microsoft Windows

Paul Allen and Bill Gates (respectively) on October 19, 1981 in a sea of PCs after signing a pivotal contract. IBM called Microsoft in July 1980 inquiring about programming languages for its upcoming PC line;^[2] after failed negotiations with another company, IBM gave Microsoft a contract to develop the OS for the new line of PCs.^[3]

Early history

Paul Allen and Bill Gates, childhood friends with a passion in computer programming, were seeking to make a successful business utilizing their shared skills. The January 1975 issue of Popular Electronics featured Micro Instrumentation and Telemetry Systems's (MITS) Altair 8800 microcomputer. Allen noticed that they could program a BASIC interpreter for the device; after a call from Gates claiming to have a working interpreter, MITS requested a demonstration. Since they didn't actually have one, Allen worked on a simulator for the Altair while Gates developed the interpreter. Although they developed the interpreter on a simulator and not the actual device, the interpreter worked flawlessly when they demonstrated the interpreter to MITS in Albuquerque, New Mexico in March 1975; MITS agreed to distribute it, marketing it as Altair BASIC.^[4] They officially established Microsoft on April 4, 1975, with Gates as the CEO.^[5] Allen came up with the original name of "Micro-Soft," as recounted in a 1995 Fortune magazine article. In August 1977 the company formed an agreement with ASCII Magazine in Japan, resulting in its first international office, "ASCII Microsoft".^[6] The company moved to a new home in Bellevue, Washington in January 1979.^[5]

Microsoft Inc. logo history
Logo	Years

	Microsoft "blibbet" logo, filed August 26, 1982 at the USPTO and used until 1987.^[7]
	Microsoft "Pac-Man" logo, designed by Scott Baker and used since 1987, with the 1994–2002 slogan "Where do you want to go today?".^[8]^[9]
	Microsoft logo as of 2006–2011, with the slogan "Your potential. Our passion."^[9]
	Logo by Microsoft with the slogan"Be What's Next." 2011–present.^[10]

Microsoft entered the OS business in 1980 with its own version of Unix, called Xenix.^[11] However, it was DOS (Disk Operating System) that solidified the company's dominance. After negotiations with Digital Research failed, IBM awarded a contract to Microsoft in November 1980 to provide a version of the CP/M OS, which was set to be used in the upcoming IBM Personal Computer (IBM PC).^[12] For this deal, Microsoft purchased a CP/M clone called 86-DOS from Seattle Computer Products, branding it as MS-DOS, which IBM rebranded to PC-DOS. Following the release of the IBM PC in August 1981, Microsoft retained ownership of MS-DOS. Since IBM copyrighted the IBM PC BIOS, other companies had to reverse engineer it in order for non-IBM hardware to run as IBM PC compatibles, but no such restriction applied to the operating systems. Due to various factors, such as MS-DOS's available software selection^{[citation needed]}, Microsoft eventually became the leading PC OS vendor.^[3]^[13] The company expanded into new markets with the release of the Microsoft Mouse in 1983, as well as a publishing division named Microsoft Press.^[14] Paul Allen resigned from Microsoft in February after developing Hodgkin's disease.^[15]

1984–1994: Windows and Office

While jointly developing a new OS with IBM in 1984, OS/2, Microsoft released Microsoft Windows, a graphical extension for MS-DOS, on November 20.^[16] Microsoft moved its headquarters to Redmond on February 26, 1986, and on March 13 the company went public;^[17] the ensuing rise in the stock would make an estimated four billionaires and 12,000 millionaires from Microsoft employees.^[18] Due to the partnership with IBM, in 1990 the Federal Trade Commission set its eye on Microsoft for possible collusion; it marked the beginning of over a decade of legal clashes with the U.S. Government.^[19] Microsoft announced the release of its version of OS/2 to original equipment manufacturers (OEMs) on April 2, 1987;^[20] meanwhile, the company was at work on a 32-bit OS, Microsoft Windows NT, using ideas from OS/2; it shipped on July 21, 1993 with a new modular kernel and the Win32 application programming interface (API), making porting from 16-bit (MS-DOS-based) Windows easier. Once Microsoft informed IBM of NT, the OS/2 partnership deteriorated.^[21]

Microsoft introduced its office suite, Microsoft Office, in 1990. The software bundled separate office productivity applications, such as Microsoft Word and Microsoft Excel.^[22] On May 22 Microsoft launched Windows 3.0 with a streamlined user interface graphics and improved protected mode capability for the Intel 386 processor.^[23] Both Office and Windows became dominant in their respective areas.^[24]^[25] Novell, a Word competitor from 1984–1986, filed a lawsuit years later claiming that Microsoft left part of its APIs undocumented in order to gain a competitive advantage.^[26]

On July 27, 1994, the U.S. Department of Justice, Antitrust Division filed a Competitive Impact Statement that said, in part: "Beginning in 1988, and continuing until July 15, 1994, Microsoft induced many OEMs to execute anticompetitive "per processor" licenses. Under a per processor license, an OEM pays Microsoft a royalty for each computer it sells containing a particular microprocessor, whether the OEM sells the computer with a Microsoft operating system or a non-Microsoft operating system. In effect, the royalty payment to Microsoft when no Microsoft product is being used acts as a penalty, or tax, on the OEM's use of a competing PC operating system. Since 1988, Microsoft's use of per processor licenses has increased."^[27]

1995–2005: Internet and the 32-bit era

Bill Gates giving his deposition in 1998 for the United States v. Microsoft trial. Once the U.S. Department of Justice 1993 took over from the Federal Trade Commission, a protracted legal wrangling between Microsoft and the department ensued, resulting in various settlements and possible blocked mergers. Microsoft would point to companies such as AOL-Time Warner in its defense.^[19]

Following Bill Gates's internal "Internet Tidal Wave memo" on May 26, 1995 Microsoft began to redefine its offerings and expand its product line into computer networking and the World Wide Web.^[28] The company released Windows 95 on August 24, 1995, featuring pre-emptive multitasking, a completely new user interface with a novel start button, and 32-bit compatibility; similar to NT, it provided the Win32 API.^[29]^[30] Windows 95 came bundled with the online service MSN, and for OEMs Internet Explorer, a web browser. Internet Explorer was not bundled with the retail Windows 95 boxes because the boxes were printed before the team finished the web browser, and instead was included in the Windows 95 Plus! pack.^[31] Branching out into new markets in 1996, Microsoft and NBC Universal created a new 24/7 cable news station, MSNBC.^[32] Microsoft created Windows CE 1.0, a new OS designed for devices with low memory and other constraints, such as personal digital assistants.^[33] In October 1997, the Justice Department filed a motion in the Federal District Court, stating that Microsoft violated an agreement signed in 1994 and asked the court to stop the bundling of Internet Explorer with Windows.^[34]

Bill Gates handed over the CEO position on January 13, 2000 to Steve Ballmer, an old college friend of Gates and employee of the company since 1980, creating a new position for himself as Chief Software Architect.^[5]^[35] Various companies including Microsoft formed the Trusted Computing Platform Alliance in October 1999 to, among other things, increase security and protect intellectual property through identifying changes in hardware and software. Critics decry the alliance as a way to enforce indiscriminate restrictions over how consumers use software, and over how computers behave, a form of digital rights management; for example the scenario where a computer is not only secured for its owner, but also secured against its owner as well.^[36]^[37] On April 3, 2000, a judgment was handed down in the case of United States v. Microsoft,^[38] calling the company an "abusive monopoly";^[39] it settled with the U.S. Department of Justice in 2004.^[17] On October 25, 2001 Microsoft released Windows XP, unifying the mainstream and NT lines under the NT codebase.^[40] The company released the Xbox later that year, entering the game console market dominated by Sony and Nintendo.^[41] In March 2004 the European Union brought antitrust legal action against the company, citing it abused its dominance with the Windows OS, resulting in a judgment of €497 million ($613 million) and to produce new versions of Windows XP without Windows Media Player, Windows XP Home Edition N and Windows XP Professional N.^[42]^[43]

2006–present: Windows Vista, mobile, SaaS

CEO Steve Ballmer at the MIX event in 2008. In an interview about his management style in 2005, he mentioned that his first priority was to get the people he delegates to in order. Ballmer also emphasized the need to continue pursuing new technologies even if initial attempts fail, citing the original attempts with Windows as an example.^[44]

Released in January 2007, the next version of Windows, Windows Vista, focused on features, security, and a redesigned user interface dubbed Aero.^[45]^[46] Microsoft Office 2007, released at the same time, featured a "Ribbon" user interface which was a significant departure from its predecessors. Relatively strong sales of both titles helped to produce a record profit in 2007.^[47] The European Union imposed another fine of €899 million ($1.4 billion) for Microsoft's lack of compliance with the March 2004 judgment on February 27, 2008, saying that the company charged rivals unreasonable prices for key information about its workgroup and backoffice servers. Microsoft stated that it was in compliance and that "these fines are about the past issues that have been resolved".^[48]

Bill Gates retired from his role as Chief Software Architect on June 27, 2008 while retaining other positions related to the company in addition to being an advisor for the company on key projects.^[49] Azure Services Platform, the company's entry into the cloud computing market for Windows, launched on October 27, 2008.^[50] On February 12, 2009, Microsoft announced its intent to open a chain of Microsoft-branded retail stores, and on October 22, 2009 the first retail Microsoft Store opened in Scottsdale, Arizona; the same day the first store opened Windows 7 was officially released to the public. Windows 7's focus was on refining Vista with ease of use features and performance enhancements, rather than a large reworking of Windows.^[51]^[52]^[53]

As the smartphone industry boomed beginning in 2007, Microsoft struggled to keep up with its rivals Apple and Google in providing a modern smartphone operating system. As a result, in 2010, Microsoft revamped their aging flagship mobile operating system, Windows Mobile, replacing it with the new Windows Phone OS; along with a new strategy in the smartphone industry that has Microsoft working more closely with smartphone manufactures, such as Nokia, and to provide a consistent user experience across all smartphones using Microsoft's Windows Phone OS.

Microsoft is a founding member of the Open Networking Foundation started on March 23, 2011. Other founding companies include Google, HP Networking, Yahoo, Verizon, Deutsche Telekom and 17 other companies. The nonprofit organization is focused on providing support for a new cloud computing initiative called Software-Defined Networking.^[54] The initiative is meant to speed innovation through simple software changes in telecommunications networks, wireless networks, data centers and other networking areas.^[55]

Product divisions

Main article: Microsoft Product Divisions

For the 2010 fiscal year, Microsoft had five product divisions: Windows & Windows Live Division, Server and Tools, Online Services Division, Microsoft Business Division, and Entertainment and Devices Division.

Windows & Windows Live Division, Server and Tools, Online Services Division

The company's Client division produces the flagship Windows OS line such as Windows 7; it also produces the Windows Live family of products and services. Server and Tools produces the server versions of Windows, such as Windows Server 2008 R2 as well as a set of development tools called Microsoft Visual Studio, Microsoft Silverlight, a web application framework, and System Center Configuration Manager, a collection of tools providing remote-control abilities, patch management, software distribution and a hardware/software inventory. Other server products include: Microsoft SQL Server, a relational database management system, Microsoft Exchange Server, for certain business-oriented e-mail and scheduling features, Small Business Server, for messaging and other small business-oriented features; and Microsoft BizTalk Server, for business process management.

Microsoft provides IT consulting ("Microsoft Consulting Services") and produces a set of certification programs handled by the Server and Tools division designed to recognize individuals who have a minimal set of proficiencies in a specific role; this includes developers ("Microsoft Certified Solution Developer"), system/network analysts ("Microsoft Certified Systems Engineer"), trainers ("Microsoft Certified Trainers") and administrators ("Microsoft Certified Systems Administrator" and "Microsoft Certified Database Administrator"). Microsoft Press, which publishes books, is also managed by the division. The Online Services Business division handles the online service MSN and the search engine Bing. As of December 2009, the company also possesses an 18% ownership of the cable news channel MSNBC without any editorial control; however, the division develops the channel's website, msnbc.com, in a joint venture with the channel's co-owner, NBC Universal.^[56]

Business Division

The Commons, located on the campus of the company's headquarters in Redmond.

The Microsoft Business Division produces Microsoft Office including Microsoft Office 2010, the company's line of office software. The software product includes Word (a word processor), Access (a relational database program), Excel (a spreadsheet program), Outlook (Groupware, frequently used with Exchange Server), PowerPoint (presentation software), and Publisher (desktop publishing software). A number of other products were added later with the release of Office 2003 including Visio, Project, MapPoint, InfoPath and OneNote. The division also develops enterprise resource planning (ERP) software for companies under the Microsoft Dynamics brand. These include: Microsoft Dynamics AX, Microsoft Dynamics NAV, Microsoft Dynamics GP, and Microsoft Dynamics SL. They are targeted at varying company types and countries, and limited to organizations with under 7,500 employees.^[57] Also included under the Dynamics brand is the customer relationship management software Microsoft Dynamics CRM, part of the Azure Services Platform.

Entertainment and Devices Division

The Entertainment and Devices Division produces the Windows CE OS for embedded systems and Windows Phone for smartphones.^[58] Microsoft initially entered the mobile market through Windows CE for handheld devices, eventually developing into the Windows Mobile OS and now, Windows Phone. Windows CE is designed for devices where the OS may not directly be visible to the end user, in particular, appliances and cars. The division also produces computer games that run on Windows PCs and other systems including titles such as Age of Empires, Halo and the Microsoft Flight Simulator series, and houses the Macintosh Business Unit which produces Mac OS software including Microsoft Office 2011 for Mac. Microsoft's Entertainment and Devices Division designs, markets, and manufactures consumer electronics including the Xbox 360 game console, the handheld Zune media player, and the television-based Internet appliance MSN TV. Microsoft also markets personal computer hardware including mice, keyboards, and various game controllers such as joysticks and gamepads.

Culture

Technical reference for developers and articles for various Microsoft magazines such as Microsoft Systems Journal (or MSJ) are available through the Microsoft Developer Network (MSDN). MSDN also offers subscriptions for companies and individuals, and the more expensive subscriptions usually offer access to pre-release beta versions of Microsoft software.^[59]^[60] In April 2004 Microsoft launched a community site for developers and users, titled Channel9, that provides a wiki and an Internet forum.^[61] Another community site that provides daily videocasts and other services, On10.net, launched on March 3, 2006.^[62] Free technical support is traditionally provided through online Usenet newsgroups, and CompuServe in the past, monitored by Microsoft employees; there can be several newsgroups for a single product. Helpful people can be elected by peers or Microsoft employees for Microsoft Most Valuable Professional (MVP) status, which entitles them to a sort of special social status and possibilities for awards and other benefits.^[63]

Noted for its internal lexicon, the expression "eating our own dog food" is used to describe the policy of using prerelease and beta versions of products inside Microsoft in an effort to test them in "real-world" situations.^[64] This is usually shortened to just "dog food" and is used as noun, verb, and adjective. Another bit of jargon, FYIFV or FYIV ("F**k You, I'm [Fully] Vested"), is used by an employee to indicate they are financially independent and can avoid work anytime they wish.^[65] The company is also known for its hiring process, mimicked in other organizations and dubbed the "Microsoft interview", which is notorious for off-the-wall questions such as "Why is a manhole cover round?".^[66]

Microsoft is an outspoken opponent of the cap on H1B visas, which allow companies in the U.S. to employ certain foreign workers. Bill Gates claims the cap on H1B visas makes it difficult to hire employees for the company, stating "I'd certainly get rid of the H1B cap" in 2005.^[67] Critics of H1B visas argue that relaxing the limits would result in increased unemployment for U.S. citizens due to H1B workers working for lower salaries.^[68] The Human Rights Campaign Corporate Equality Index, a report of how progressive the organization deems company policies towards LGBT (lesbian, gay, bisexual and transsexual) employees, rated Microsoft as 87% from 2002 to 2004 and as 100% from 2005 to 2010 after they allowed gender expression.^[69]

In a 2012 news story, Sky News reported, "Microsoft is investigating working conditions at a Chinese factory producing the Xbox games system after more than 300 employees reportedly threatened to throw themselves off a building. Chinese news websites said aggrieved staff at the Foxconn factory in Wuhan had asked for a raise before the incident. The employees were apparently told they could keep their jobs with no pay increase or resign and receive a pay-off. But after most opted to leave and take the compensation, the offer was reportedly withdrawn and the workers did not receive their payments."^[70]

Criticism

Main article: Criticism of Microsoft

Criticism of Microsoft has followed the company's existence because of various aspects of its products and business practices. Ease of use, stability, and security of the company's software are common targets for critics. More recently, Trojan horses and other exploits have plagued numerous users due to faults in the security of Microsoft Windows and other programs. Microsoft is also accused of locking vendors into their products, and of not following and complying with existing standards in its software.^[71] Total cost of ownership comparisons of Linux as well as Mac OS X to Windows are a continuous point of debate.

The company has been in numerous lawsuits by several governments and other companies for unlawful monopolistic practices. In 2004, the European Union found Microsoft guilty in a highly publicized anti-trust case. Additionally, Microsoft's EULA for some of its programs is often criticized as being too restrictive as well as being against open source software.

Criticism of the company has resulted in it being deemed "the evil empire" by some.^[72] In a sci-fi allusion, Microsoft has also been called "The Borg" after the fictional race of aliens in the Star Trek universe. It reflects the perception that Microsoft often acquires technology from other companies rather than developing it in-house^[73], as well as to Microsoft's ability to adapt to and overwhelm its opponents' strategies. ^[74] ^[75] ^[76] ^[77] ^[78] ^[79]

Corporate affairs

The company is run by a board of directors made up of mostly company outsiders, as is customary for publicly traded companies. Members of the board of directors as of June 2010 are: Steve Ballmer, Dina Dublon, Bill Gates (chairman), Raymond Gilmartin, Reed Hastings, Maria Klawe, David Marquardt, Charles Noski, and Helmut Panke.^[80] Board members are elected every year at the annual shareholders' meeting using a majority vote system. There are five committees within the board which oversee more specific matters. These committees include the Audit Committee, which handles accounting issues with the company including auditing and reporting; the Compensation Committee, which approves compensation for the CEO and other employees of the company; the Finance Committee, which handles financial matters such as proposing mergers and acquisitions; the Governance and Nominating Committee, which handles various corporate matters including nomination of the board; and the Antitrust Compliance Committee, which attempts to prevent company practices from violating antitrust laws.^[81]

Five year history graph of (NASDAQ:MSFT) stock on September 29, 2009.^[82]

When Microsoft went public and launched its initial public offering (IPO) in 1986, the opening stock price was $21; after the trading day, the price closed at $27.75. As of July 2010, with the company's nine stock splits, any IPO shares would be multiplied by 288; if one was to buy the IPO today given the splits and other factors, it would cost about 9 cents.^[83]^[84]^[85] The stock price peaked in 1999 at around $119 ($60.928 adjusting for splits).^[86] The company began to offer a dividend on January 16, 2003, starting at eight cents per share for the fiscal year followed by a dividend of sixteen cents per share the subsequent year, switching from yearly to quarterly dividends in 2005 with eight cents a share per quarter and a special one-time payout of three dollars per share for the second quarter of the fiscal year.^[86]^[87] Though the company had subsequent increases in dividend payouts, the price of Microsoft's stock remained steady for years.^[87]^[88]

One of Microsoft's business tactics, described by an executive as "embrace, extend and extinguish," initially embraces a competing standard or product, then extends it to produce their own version which is then incompatible with the standard, which in time extinguishes competition that does not or cannot use Microsoft's new version.^[89] Various companies and governments sue Microsoft over this set of tactics, resulting in billions of dollars in rulings against the company.^[90]^[38]^[43] Microsoft claims that the original strategy is not anti-competitive, but rather an exercise of its discretion to implement features it believes customers want.^[91]

Financial

Standard and Poor's and Moody's have both given a AAA rating to Microsoft, whose assets were valued at $41 billion as compared to only $8.5 billion in unsecured debt. Consequently, in February 2011 Microsoft released a corporate bond amounting to $2.25 billion with relatively low borrowing rates compared to government bonds.^[92]

For the first time in 20 years Apple Inc. surpassed Microsoft in Q1 2011 quarterly profits and revenues due to a slowdown in PC sales and continuing huge losses in Microsoft's Online Services Division (which contains its search engine Bing). Microsoft profits were $5.2 billion, while Apple Inc. profits were $6 billion, on revenues of $14.5 billion and $24.7 billion respectively.^[93]

Microsoft's Online Services Division has been continuously loss-making since 2006 and in Q1 2011 it lost $726 million. This follows a loss of $2.5 billion for the year 2010.^[94]

Environment

Microsoft is ranked on the 17th place in Greenpeace’s Guide to Greener Electronics that ranks 18 electronics manufacturers according to their policies on toxic chemicals, recycling and climate change.^[95] Microsoft’s timeline for phasing out BFRs and phthalates in all products is 2012 but its commitment to phasing out PVC is not clear. As yet (January 2011) it has no products that are completely free from PVC and BFRs.^[96]

Microsoft's main U.S. campus received a silver certification from the Leadership in Energy and Environmental Design (LEED) program in 2008, and it installed over 2,000 solar panels on top of its buildings in its Silicon Valley campus, generating approximately 15 percent of the total energy needed by the facilities in April 2005.^[97]

Microsoft makes use of alternative forms of transit. It created one of the worlds largest private bus systems, the "Connector", to transport people from outside the company; for on-campus transportation, the "Shuttle Connect" uses a large fleet of hybrid cars to save fuel. The company also subsidises regional public transport as an incentive.^[97]^[98] In February 2010 however, Microsoft took a stance against adding additional public transport and high-occupancy vehicle (HOV) lanes to a bridge connecting Redmond to Seattle; the company did not want to delay the construction any further.^[99]

Microsoft was ranked number 1 in the list of the World's Best Multinational Workplaces by the Great Place to Work Institute in 2011.^[100]

Marketing

In 2004, Microsoft commissioned research firms to do independent studies comparing the total cost of ownership (TCO) of Windows Server 2003 to Linux; the firms concluded that companies found Windows easier to administrate than Linux, thus those using Windows would administrate faster resulting in lower costs for their company (i.e. lower TCO).^[101] This spurred a wave of related studies; a study by the Yankee Group concluded that upgrading from one version of Windows Server to another costs a fraction of the switching costs from Windows Server to Linux, although companies surveyed noted the increased security and reliability of Linux servers and concern about being locked into using Microsoft products.^[102] Another study, released by the OSDL, claimed that the Microsoft studies were "simply outdated and one-sided" and their survey concluded that the TCO of Linux was lower due to Linux administrators managing more servers on average and other reasons.^[103]

As part of the "Get the Facts" campaign Microsoft highlighted the .NET trading platform that it had developed in partnership with Accenture for the London Stock Exchange, claiming that it provided "five nines" reliability. After suffering extended downtime and unreliability^[104]^[105] the LSE announced in 2009 that it was planning to drop its Microsoft solution and switch to a Linux based one in 2010.^[106]^[107]

Microsoft adopted the so-called "Pac-Man Logo", designed by Scott Baker, in 1987. Baker stated "The new logo, in Helvetica italic typeface, has a slash between the o and s to emphasize the "soft" part of the name and convey motion and speed."^[108] Dave Norris ran an internal joke campaign to save the old logo, which was green, in all uppercase, and featured a fanciful letter O, nicknamed the blibbet, but it was discarded.^[109] Microsoft's logo with the "Your potential. Our passion." tagline below the main corporate name, is based on a slogan Microsoft used in 2008. In 2002, the company started using the logo in the United States and eventually started a TV campaign with the slogan, changed from the previous tagline of "Where do you want to go today?".^[8]^[9]^[110] During the private MGX (Microsoft Global Exchange) conference in 2010, Microsoft unveiled the company's next tagline, "Be What's Next.", as well as a new logo scheduled for use sometime in the future.^[10]

References

Infobox statistics, Product divisions

"2011 Form 10-K, Microsoft Corporation". United States Securities and Exchange Commission. July 28, 2011. http://www.sec.gov/Archives/edgar/data/789019/000119312511200680/d10k.htm. Retrieved August 23, 2011.

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Bibliography

Allan, Roy A. (2001). A History of the Personal Computer. Allan Publishing. ISBN 0-9689108-0-7. http://books.google.com/?id=FLabRYnGrOcC. Retrieved July 17, 2010.
Blaxill, Mark; Eckardt, Ralph (March 5, 2009). The Invisible Edge: Taking Your Strategy to the Next Level Using Intellectual Property. Portfolio Hardcover. ISBN 1591842379. http://books.google.com/?id=JO6kA0hebJIC&pg=PA210&lpg=PA210&dq=%22columbia+data+products%22+clone+bios&q=%22columbia%20data%20products%22%20clone%20bios. Retrieved July 7, 2010.
Pietrek, Matt (March 1996) (PDF). Windows 95 Programming Secrets. IDG. ISBN 1-56884-318-6. http://cs.mipt.ru/docs/comp/eng/os/win32/win95_sys_progr_secr/main.pdf. Retrieved July 17, 2010.

External links

Find more about Microsoft on Wikipedia's sister projects:
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	Learning resources from Wikiversity
	News stories from Wikinews
	Quotations from Wikiquote
	Source texts from Wikisource
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Official website

Microsoft

Technologies

Web properties

Websites and services	adCenter Bing BrowserChoice.eu Channel 9 CodePlex MSDN HealthVault Ignition Microsoft Store Microsoft Pinpoint Microsoft Wave MSN (Games MSNBC msnbc.com ninemsn) TechNet Windows Live (Groups Hotmail ID Messenger Spaces) Microsoft Popfly Windows Phone Marketplace

Live	Games for Windows – Live Xbox Live (Arcade Marketplace) Zune Social

Gaming

Hardware

Released	Surface Natural Keyboard Keyboard Mouse LifeCam Lifechat SideWinder

Prototypes	Courier Venus

Discontinued	Zune (30 80 / 120 4 / 8 / 16 HD) Fingerprint Jazz Audio System Cordless Phone Ultra-mobile PC Pocket PC Roundtable Response Point Kin MSN TV Broadband Networking

Education
and
recognition

Licensing

Further information: List of Microsoft topics

v d e Executive officers of Microsoft Corporation

Board of Directors	Bill Gates (chairman) Steve Ballmer Dina Dublon Raymond Gilmartin Reed Hastings Maria Klawe David Marquardt Charles Noski Helmut Panke

Chief officers	Steve Ballmer (CEO) Peter Klein (CFO) Craig Mundie (CRSO) Kevin Turner (COO)

Presidents and VPs	Steven Sinofsky Qi Lu Don Mattrick Andy Lees Jon DeVaan (SVP) Richard Rashid (SVP) Satya Nadella S. Somasegar (SVP) Tony Bates

Links to related articles

Major information technology companies

Consulting and
outsourcing

Imaging

Information storage

Mainframes

Mobile devices

Networking equipment

OEMs

Personal computers
and servers

Servers only	IBM Oracle Unisys

Semiconductors

Foundries	GlobalFoundries TSMC United Microelectronics Corporation

Software

Telecommunications
services

Websites

Methodology: FY2010/11 applicable revenues of over: group 1-10 and 12 - US$3 billion; group 11 - US$10 billion

v d e Components of the Dow Jones Industrial Average

Current	3M Alcoa American Express AT&T Bank of America Boeing Caterpillar Chevron Cisco Systems The Coca-Cola Company DuPont ExxonMobil General Electric Hewlett-Packard The Home Depot Intel IBM Johnson & Johnson JPMorgan Chase Kraft Foods McDonald's Merck & Co. Microsoft Pfizer Procter & Gamble The Travelers Companies United Technologies Corporation Verizon Communications Walmart The Walt Disney Company

Selected former	Altria Group American International Group American Tobacco Company Bethlehem Steel Citigroup Colorado Fuel and Iron Kodak General Foods General Motors Goodyear Tire and Rubber Company Honeywell International Harvester International Paper Johns Manville Nash Motors Navistar International North American Company Owens-Illinois Sears, Roebuck and Company Union Carbide United States Rubber Company U.S. Steel F. W. Woolworth Company

Companies of the NASDAQ-100 index

v d e Seattle-based Corporations (within the Seattle metropolitan area)

Seattle and SeaTac-based Fortune 1000 Corporations	Amazon.com (#100) · Starbucks (#241) · Nordstrom (#270) · Expeditors International · Alaska Airlines

Puget Sound-based Fortune 1000 Corporations	Companies listed above, plus: Costco Wholesale (#25) · Microsoft (#36) · Paccar (#282) · Weyerhaeuser (#379) · Puget Sound Energy · Expedia

Major Seattle- and Puget Sound-based non-public or externally owned corporations	Big Fish Games · Boeing · Darigold · Eddie Bauer · Jones Soda · Nintendo of America · QFC · REI · Safeco · T-Mobile USA

This entry is from Wikipedia, the leading user-contributed encyclopedia. It may not have been reviewed by professional editors (see full disclaimer)

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