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In the late 1970s the hacker culture began to fragment as companies stopped distributing source code and began using copyright and restrictive software licenses. Significantly, the change of the times was signalled by a conflict between Bill Gates and the hacker community.

==Altair Basic==
This conflict centred around software made for the [[Altair]], generally considered to be the first personal computer. In 1975 appeared the advertisement in Popular Electronics magazine that set thousands of hobbyists ordering the MITS Altair kit. Ed Roberts of MITS received a letter from a Seattle company asking if he would be interested in buying its BASIC programming language for the machine. He called the company and reached a private home, where no one had heard of BASIC. The letter had in fact been sent from the Boston area by two students at Harvard, Bill Gates and Paul Allen. They called Roberts to follow up and told him they had programs that would run BASIC on the Altair. Roberts was interested, so Gates and Allen who did not actually have the programs written, immediately set out to write them.

Gates and Allen first wrote a program on a Harvard PDP-10 minicomputer that would simulate the limited capabilities of the Altair's 8080 chip. They then started making their BASIC interpreter, using the simulator to test it. They estimated they had 30 days before someone else beat them to it. In about six weeks they had a version that worked on the simulator. Allen flew to Albuquerque to deliver Altair BASIC on a paper tape. The first time it was run, it displayed "Altair Basic," and then crashed. The next day he brought in a new paper tape and it ran. (However, it only worked on the more sophisticated lab version of the Altair at MITS rather than on the stripped-down version sold to the general public.) Gates and Allen soon thereafter founded their company, Microsoft, to market the Altair BASIC.

==Bill Gates' "Open Letter to Hobbyists"==
Contrary to the [[Hacker Ethic]] of the previous period, Microsoft and MITS felt that people should pay for the BASIC software just as they paid for any add-on card. Many hackers had in fact put in orders for BASIC, but had to wait for the order to be shipped due to the backlog at MITS. During a show put up by MITS, someone got hold of and copied a paper tape containing Altair BASIC. The tapes were duplicated and passed around freely. Since Gates and Allen were actually paid a commission for each copy of BASIC that MITS sold, Gates responded by writing his now-famous “Open Letter to Hobbyists.” Gates' message was that what hackers called "sharing" should be considered "stealing."

==Bill Gates and MS-DOS==
The first generation of microcomputers used an operating system called CP/M. When the creator of CP/M failed to negotiate an agreement with IBM, Bill Gates and Microsoft signed a contract with IBM to provide an alternative operating system for the IBM personal computer, which became MS-DOS. The creator of CP/M claimed that the initial operating system provided by Microsoft was in fact only a modified version of CP/M.

==Links==
*Full text of the Gates "Open Letter": [[find this link]]

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