Altair BASIC
Bill Gates was a student at Harvard University and Paul Allen worked for Honeywell in Boston when they saw the Altair computer on the cover of Popular Electronics. They had previously written software for the earlier Intel 8008 microprocessor and knew the Intel 8080 was powerful enough to support a BASIC interpreter. They sent a letter to MITS claiming to have a BASIC interpreter for the 8080 microprocessor. Roberts was interested, so Gates and Allen began work on the software. Both had experience with the Digital Equipment Corporation PDP-10 minicomputers that they would use. Allen modified the DEC Macro Assembler to produce code for the Intel 8080 and wrote a program to emulate the 8080 so they could test their BASIC without having an Altair computer. Using DEC's BASIC-PLUS language as a guide, Gates determined what features would work with the limited resources of the Altair computer. Gates then started writing the 8080 assembly-language code on yellow legal pads. In February Gates and Allen started using a PDP-10 at Harvard to write and debug BASIC. They also enlisted another Harvard student, Monte Davidoff, to write the floating-point math routines.
Paul Allen flew to Albuquerque, New Mexico, in March 1975 to test BASIC on a real Altair 8800 computer. Roberts picked him up at the airport in his pickup truck and drove to the nondescript storefront where MITS was located. Allen was not impressed. The Altair computer with 7 kB of memory that BASIC required was still being tested and would not be ready until the next day. Roberts had booked Allen in the most expensive hotel in Albuquerque and the room was $40 more than Allen brought with him. Roberts paid for the room and wondered who is this software guy who can not afford a room in a hotel.
The next day the Altair with 7 kB had finally passed its memory test and Allen had their BASIC interpreter on a paper tape Bill Gates had created just before Allen left Boston. It took almost 15 minutes for the Teletype to load the program into the Altair then the Teletype printed "MEMORY SIZE?" Allen entered 7168 and the Teletype printed "READY". Both Allen and Roberts were stunned their software and hardware actually worked. They entered several small programs and they worked. The BASIC interpreter was not complete and crashed several times, but Roberts had a high level language for his computer. Roberts hired Allen as Vice President and Director of Software at MITS. Bill Gates also worked at MITS; the October 1975 company newsletter gives his title as "Software Specialist".
Bill Gates remained at Harvard, but continued working on BASIC. Students were allowed to use the DEC PDP-10, but officials were not pleased when they found that Gates was developing a commercial product. The school then implemented a policy that forced Gates to use a commercial time share service to work on BASIC.
On July 22, 1975, MITS signed a contract for the Altair BASIC with Bill Gates and Paul Allen. They received $3000 at signing and a royalty for each copy of BASIC sold, with a cap of $180,000. MITS received an exclusive worldwide license to the program for 10 years. They also had exclusive rights to sublicense the program to other companies and agreed to use its "best efforts" to license, promote and commercialize the program. MITS would supply the computer time necessary for development on a PDP-10 owned by the Albuquerque school district.
MITS realized that BASIC was a competitive advantage and bundled the software with computer hardware sales. Customers who purchased the computer, memory, and I/O boards from MITS could get BASIC for $75; the standalone price was $500. Many hobbyists purchased their hardware from a third-party and "borrowed" a copy of Altair BASIC. Roberts refused to sub-license BASIC to other companies; this led to arbitration in 1977 between MITS and the new "Micro-Soft". The arbitrator agreed with Microsoft and allowed them to license the 8080 BASIC to other companies. Roberts was disappointed with this ruling. Since both Allen and Gates had been employees of MITS and he paid for the computer time, Roberts felt it was his software.
Read more about this topic: Ed Roberts (computer Engineer)
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