Microsoft

Type:	Publicly held
Industry:	Software
Founded:	1975
Founder(s):	Bill Gates Paul Allen
Headquarters:	Redmond, Washington
Country:	USA
Employees:	89,000 as of 7/30/10
Revenue:	$ 62.5 billion (2010)
Website:	www.microsoft.com
LinkedIn:	Microsoft
Key People
Steven Ballmer, CEO Peter S. Klein, Chief Financial Officer Kevin Turner, Chief Operating Officer

Microsoft Corporationis a multi-national company which develops, license, manufacture and support a wide range of products and services such as operating systems for personal computers, servers, intelligent devices, server applications for distributed computing, environments information worker productivity applications, business solutions applications, high performance computing applications, software development tools and video games.

Microsoft is trading at NYSE and NASDAQ under the ticker symbol "MSFT." Paul Allen and Bill Gates co-founded the company in 1975 and it is headquartered in Redmond, Washington and it has offices in more than 100 countries worldwide.

Mission

Microsoft's mission is to enable people and businesses worldwide to realize their full potential. The company is trying to achieve its objective by creating technology that transforms the way people work, play and communicate.

Business Divisions

Microsoft has five business divisions to better serve its customers. These divisions include:

1. Windows & Windows Live Division
2. Server and Tools
3. Online Services Division
4. Microsoft Business Division
5. Entertainment and Devices Division

History

Company Beginnings

The idea of establishing Microsoft began in 1971 when Paul Allen found an article in an electronics magazine about Intel's 4004 chip, the world's first microprocessor. Allen thought that this microprocessor will become better and better. After a year, Intel came up with 8008, which gave Paul Allen and Bill Gates the idea on How Moore's Law really worked. They learned that each generation of microprocessor chip was twice as fast as the previous.They decided to buy the 8008 microprocessor which became the core of a special computer designed to do traffic volume count analysis and which they would to traffic departments. Paul Allen and Bill Gates formed Traf-O-Data, their first company.

In 1973, Allen read an article from a popular electronics magazine about Altair 8800, the world's first microcomputer kit. Allen and Gates took it as a big opportunity. They wrote Altair BASIC, a true programming language, and the first commercial Microsoft computer product. In 1975, the two persuaded MITS to sell Altair Basic. Allen and Gates signed their first contract with MITS as "Paul Allen & Bill Gates doing business as Micro-Soft. Allen and Gates shared the title General Partner. In 1977, Gates held the title president and Allen, vice-president. In 1979, they decided to move the company headquarters from Albuquerque, New Mexico to Bellevue, Washington. Steven Ballmer joined the company the following year as first assistant to the president. His primary responsibility was to establish policies and procedures in the financial, organizational, and resource allocation areas.

In 1980, Paul Allen negotiated the purchase of an obscure operating system called Q-DOS from Seattle Computer. The two licensed Q-DOS to IBM, which became the deal of the decade. This transaction paved the way for Microsoft to dominate the PC Software Industry. Microsoft developed a new operating system called MS-DOS (Microsoft Disk Operating System).

Microsoft Corporation

On June 25, 1981 Microsoft was officially incorporated in Washington as a privately held corporation with Bill Gates as President and Chairman of the Board while Paul Allen as Executive Vice President. On August 12, 1981, IBM introduced its new Personal Computer using Microsoft's 16-bit computer operating system called MS-DOS 1.0.

In 1983, Paul Allen was diagnosed with Hodgkins disease and resigned as executive vice-president, but he remained member of the board. Jon Shirley became president of Microsoft and later assumed the role of CEO. Microsoft also introduced the Microsoft Mouse and Word for MS-DOS 1.00.

Initial Public Offering

On March 14, 1986, Microsoft went public and traded more than 3.58 million shares. The stock price was $21 per share during the opening day day and closed at $27.Co-founders Paul Allen and Bill Gates became instant millionaires during the offering.

In 1987, Microsoft's stocks reached $100 per share. Bill Gates wealth is worth USD 56 billion and he became the youngest self-made billionaire at the age of 31.

Product Development in 1990s

In 1990, Microsoft became the first microcomputer software company to record more than $1 billion sales in a single year and reported a revenue increase of 47%. In 1992, the company re-structured its organization and outlined three centers of strategic focus on worldwide product development, worldwide sales and support, and worldwide operations.Bill Gates and Intel Corporation president, Andrew S. Grove partnered in developing the next wave in personal computing, called Digital Video Computing. The company released Windows 3.0 and 3.1, and sold 10 million copies during the first two years. The following year in 1993, Microsoft completed the Windows NT, a project that began in the 1980s. The NT 3.1, a strategic business platform that supports high-end engineering and scientific programs in a 32-bit operating system. In 1995, the company launched the Windows 95 and sold 7 million copies within the first five weeks. It was followed by the release of other Microsofts products such as the Internet Explorer, Windows 98, Windows Me, Windows Media Player and others.

Rapid Growth from 2000 to Present

Bill Gates created a new position in the company and assumed the role of Chief Software Architect from 2000 until 2006, he dedicated his time to developing the next generation of Windows Internet platform and services. While serving as Chief Software Architect, Gates remained Chairman of the company. Different Microsoft product were launched such as Microsoft Office XP, Microsoft XBox, Microsoft Visual Studio .Net, Microsoft Visual J#.Net, Visual C++.Net, Visual Basic.Net, MSN 8, Tablet PC and many other products. The company also expanded its operations, and now maintains offices in more than 100 countries worldwide. Microsoft also made numerous mergers and acquisitions.The company's 2010 reported revenue was $ 62.5 billion.

Acqusitions

Microsoft's largest aquisitions include:

• aQuantive, advertising software and services-$ 6 billion
• Navision accounting software- $1.45 billion
• Visio, design and charting software- $1.3 billion
• FAST Search and Transfer, enterprise search specialists- $1.2 billion
• Great Plains accounting software- $940 million
• TellMe voice technology- $800 estimate
• Danger (mobile software and services-) $500 million estimate
• Greenfield Online (CIAO)-$485 million
• Web TV - $425 million
• Hotmail- $400 million estimate
• Rare (game developer)-$375 million
• LinkExchange (paid search company)- $265 million
• Massive (in-game advertising)- $ 280 million estimate
• Placeware (virtual meeting service)- $200 million estimate
• Groove- $171 million

Subsidiaries

Microsoft's subsidiaries include: MOL Corporation, Nevada, USA, Microsoft Global Finance, Ireland, Microsoft General Management Company, Nevada, USA, Microsoft Ireland Operations Limited, Ireland, Bagheera International Limited, British Virgin Islands, Microsoft Licensing, GP, Nevada, USA, Microsoft T-Holdings, Inc., Nevada, USA, Round Island One, Ireland, GraceMac Corporation, Nevada, USA, Flat Island Company Limited, Ireland, Microsoft Manufacturing B.V., Netherlands, Microsoft Operations Pte Ltd,, Singapore, Microsoft Company, Limited, Japan, Microsoft PF Holdings, BV, Netherlands, Microsoft Operations Puerto Rico, LLC, Puerto Rico, Microsoft Development Center Copenhagen ApS, Denmark etc.

Legal Battles

In 1990, the US Federal Trade Commission started investigating Microsoft's business relationship with IBM, suspecting the company of possible violations of the Sherman and Clayton Antitrust Acts. The Federal Trade Commission's inquiry lasted for more than three years.

In 1994, the U.S. Department of Justice investigated Microsoft regarding allegations that the company is involved in monopolistic practices in the PC software market. The investigation was triggered by the complaints filed by Novell, a software company, for allegedly monopolizing the word processing and spreadsheet market.

In 1998, the Justice Department filed charges against the company for allegedly engaging in a pattern of anticompetitive acts. Microsoft allegedly violated a 1994 consent decree regarding the licensing of the Windows operating system to computer manufacturers, and violations of Section 1 and Section 2 of the Sherman Act for illegal business practices and for illegally protecting and extending the Windows software monopoly respectively.

In 2003, the European Commission won the monopoly abuse case against Microsoft for linking its media player to Windows and fined the company 497 million euros.

Microsoft and ICANN

On January 24, 2001, Microsoft Benelux Support Manager Ruud de Jonge confirmed that the majority of Microsoft websites were down due to a problem in the system that maps Web addresses to IP addresses. In a statement Jonge said, "It can be a system or human error, but somebody could also have done this intentionally. We don't manage the DNS ourselves, it is a system controlled by the Internet Corporation for Assigned Names and Numbers (ICANN) with worldwide replicas." This sparked comments from the Internet community and some concluded that Microsoft blamed ICANN for the failures of its domain name servers.

After the failures were resolved, Microsoft issued an apology to its customers and explained that the operational errors were not caused by any third party instead a Microsoft technician made a wrong configuration change to the routers on the edge of Microsoft's Domain Name Server network which caused limited communication between DNS servers on the Internet and Microsoft's DNS servers.

In 2006, Microsoft became an ICANN accredited registrar for .biz, .com, .info, .name, .net, .pro and .org.

In 2009, the company collaborated with ICANN, along with security researchers and operators within the DNS, to implement a coordinated global response to the Conficker Worm. It coordinated a response designed to disable domains targeted by Conficker and offered a $250,000 reward for information that results in the arrest and conviction of those responsible for illegally launching the Conficker malicious code on the Internet.