CertiGuide to A+ (Core Hardware)  9  Chapter 0000:  The Start of the PC       9  III  IBM and the Creation of the PC

III  IBM and the Creation of the PC 1 IBM PC

Tim Patterson was working hard at a small firm called Seattle Computer Products. In reality, Seattle Computer Products wasn't in Seattle at all; it sat in a little Seattle suburb on Industry Drive in Tukwila, Washington. Their flagship product was a Computer Aided Design and Drafting (CADD) computer. Tim had a challenge. LP/M crashed when it attempted to work with the then super fast 8086 CPU. So, Tim created Gazelle DOS.

Bill offered to buy Gazelle DOS, outright, neglecting to mention his relationship with IBM (remember the NDA?). In the end, Microsoft came to an agreement with Seattle Computer Products, which allowed Tim to keep Gazelle DOS for his own use as long as it bundled (sold) with a CPU, and received $50,000.00 to allow Microsoft's use of DOS. (Tim later used that funding to start Falcon Computer Products, with the first item being a very fast hard drive controller.)

Reportedly, Microsoft licensed DOS to IBM for one dollar per copy, with the provision that Microsoft could license DOS to other vendors.

III  IBM and the Creation of the PC 1 IBM PC