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The Story of CP/M
Could microprocessors run full computers? This question seems obvious today, but in 1974, this was Gary Kidall's insight behind developing the operating system CP/M. It was an OS specifically built for small computers. Written in Kidall's programming language, PL/M. Kidall sold CP/M licenses through his company, Digital Research.
CP/M was special because it separated the physical I/O system (now called BIOS – Basic I/O System) from the disk operating system (at the time, called the BDOS – Basic Disk Operating System). CP/M was the start of program portability: before CP/M, programs were required to run on exactly the same underlying hardware.
In 1980, IBM was looking for an operating system for its IBM PC and naturally looked towards Digital Research and CP/M. Legend has it that Gary, an avid pilot, was out flying (perhaps to a potential customer), missing an important meeting with IBM representatives. There are numerous accounts of this meeting (or the lack of it): a refusal to sign a routine NDA or that the Kidalls were on vacation, or that it was Gary's wife's birthday, or that Gary showed up later, or that Gary was in his office the entire time.
But the conclusion is clearly recorded in history; IBM instead chose a smaller vendor to procure a PC DOS. Paul Allen and Bill Gates adopted an operating system called 86-DOS to work on IBM hardware. The IBM deal would give Microsoft the distribution it needed to jumpstart the small company's growth. The IBM PC would later support CP/M, but the OS was more expensive, and Digital Research never recovered. CP/M still was widely popular for a few more years, but MS-DOS was growing even faster.