Altair BASIC 2.0: Launching Microsoft's First Commercial Software in 1975

On July 1, 1975, MITS officially began shipping Altair BASIC 2.0, the first commercial version of the BASIC interpreter for the Altair 8800. The software was developed by Bill Gates, Paul Allen, and Monte Davidoff. The release marked the debut of Micro-Soft’s (the original name of Microsoft) first major software product and one of the earliest examples of commercial software for microcomputers.

Work on BASIC had begun months earlier, but only a preliminary version was initially available. Gates and Allen completed the first version on February 1, 1975, and demonstrated it to MITS founder Ed Roberts in March. Following the successful demonstration, MITS agreed to distribute the interpreter alongside the Altair 8800.

In the spring of 1975, MITS embarked on a promotional tour across the United States with its MITS Mobile demonstration van. An early version of BASIC was used during these demonstrations. Around that time, a member of the Homebrew Computer Club made an unauthorized copy of the program’s paper tape. The copies quickly spread among hobbyists, becoming one of the earliest major incidents of software piracy in the personal computer era.

The commercial release of Altair BASIC 2.0, however, differed significantly from the prerelease version. Over the following months, Gates, Allen, and Monte Davidoff extensively refined the software. They reduced its memory requirements, optimized the interpreter, and replaced longer commands with more compact ones. While the early version required at least 6 KB of RAM, the commercial release became available in both 4 KB and 8 KB editions.

MITS officially began shipping Altair BASIC 2.0 on July 1, although the formal written agreement between the developers and the company was not signed until July 22. Under the terms of the contract, the Micro-Soft partnership received an advance payment of $3,000, followed by royalties for every copy sold. MITS was granted exclusive worldwide distribution rights for the interpreter for ten years.

Altair BASIC was distributed on both paper tape and audio cassette. One of the surviving pieces of evidence for the release date is an original paper tape labeled “BASIC 8K without cassette”, dated July 2, 1975.

Development took place on a DEC PDP-10 minicomputer using the MACRO-10 assembler, while the interpreter itself was written in Intel 8080 assembly language. One of its key technical features was a routine called CRUNCH, which automatically converted BASIC keywords into compact one-byte tokens. This reduced memory usage and improved execution speed. Monte Davidoff was responsible for implementing the floating-point arithmetic package.

Some sources claim that Altair BASIC 2.0 was not released until October 1975. Our research indicates that this confusion stems not from the actual release date but from a later reorganization of MITS’s software business. That autumn, the company revised its pricing, began actively promoting Extended BASIC, and prepared software for the new Altair 680 computer. The commercial debut of Altair BASIC 2.0 itself took place on July 1, 1975.

Sources

• Microsoft Timeline (archived via Wayback Machine)
• Bill Gates and Paul Allen Sign a Licensing Agreement with MITS — Computing History

See also The Birth of Microsoft: How a Microcomputer Sparked a Tech Revolution (1975).