Gary Kildall's CP/M: The First PC OS That Lost to 'Plain Theft'

The Birth of CP/M

In 1974, Gary Kildall inserted an 8‑inch floppy into a microcomputer running his own program — a command line, file viewer, and directory browser he called CP/M (Control Program for Microcomputers). At the time, microcomputers from Altair, IMSAI, Cromemco, and others all used Intel 8080 or compatible chips, but each had different disk controllers and serial‑port addresses. Normally every machine would need its own custom software.

CP/M solved this by isolating hardware‑dependent code in a separate layer called the BIOS. The upper layers — file system and command interpreter — were pre‑compiled binaries that ran unchanged on any machine. A vendor only had to implement the BIOS to run CP/M. By 1981, CP/M ran on over 3,000 different models.

Kildall's Background and Digital Research

Kildall taught computer science at the Naval Postgraduate School and consulted for Intel, writing an assembler for the 4004 and the PL/M compiler. Frustrated by paper‑tape limitations, he acquired an 8‑inch floppy drive around 1972 to load programs directly. In 1974 he and his wife Dorothy founded Intergalactic Digital Research (later Digital Research) in a Victorian house in Pacific Grove, California. Kildall wrote code; Dorothy handled sales. Revenue grew from $10,000/month in 1978 to $5.4 million in 1981 and $44.6 million in 1983, all from CP/M royalties. The company never took outside funding or went public.

The IBM Meeting That Didn't Happen

In 1980 IBM approached Digital Research for an OS for its upcoming personal computer. The popular myth claims Kildall missed the meeting because he was flying his plane. His children, Scott and Kristin, refuted this in the 2016 Computer History Museum release of his memoir, calling it a "tall tale." The real sticking points were three concrete issues:

Non‑disclosure agreement: IBM wanted Digital Research to sign an NDA but refused to sign a reciprocal one.

Pricing model: Digital Research lived on per‑copy royalties; IBM demanded a flat‑fee buyout and the right to rename the software.

Delivery schedule: IBM needed a 16‑bit CP/M‑86, but Digital Research could not commit to a firm date.

Negotiations collapsed, and IBM turned to Seattle Computer Products.

Cloning via a Public Manual

At Seattle Computer Products, programmer Tim Paterson, starting in April 1980, wrote an OS called QDOS (Quick and Dirty Operating System) by following the publicly published CP/M manual. Kildall had written that manual himself, listing every system‑call number, input parameters, and return values so developers could easily adopt CP/M. Paterson's implementation replicated the API exactly. Microsoft licensed QDOS non‑exclusively for $25,000 in December 1980, then bought all rights for $50,000–$75,000 in July 1981, hired Paterson, and ported it to the IBM PC's 8088 chip, renaming it MS‑DOS.

When the IBM PC launched, MS‑DOS sold for $40 while CP/M‑86 was priced at $240. In his memoir Kildall labeled Paterson's work "plain and simple theft." The memoir's appendix placed CP/M and DOS code side by side, showing the first 26 lines of system calls were identical. Paterson maintained he had merely re‑implemented from the public manual; neither side ever conceded.

Later Years and Legacy

Novell acquired Digital Research in 1991. Kildall largely stepped back, teaching, flying, and hosting the TV series Computer Chronicles . On July 8, 1994, he fell in a Monterey bar, striking his head; he died three days later at age 52. The autopsy cited blunt‑force head trauma and evidence of a heart attack; he had struggled with alcohol.

His sister Patricia Guberlet remembered him as a genius and a genuinely likable person. Cousin Tom Kildall said simply, "He paved the way for everybody. That's the way it goes." Before his death Kildall completed a memoir, Computer Connections , which he hoped to publish the following year — it never appeared in full. In it he wrote of Bill Gates: "He is divisive. He is manipulative. He is a user. He has taken much from me and the industry." Kildall acknowledged these words were "sour grapes" but insisted they were also "the whole truth." The Computer History Museum released the first part of the manuscript in 2016; the second part remains private.

Kildall's technical contributions endure: the term BIOS and the separation of OS from hardware originated with him. Tracing Windows and DOS back leads to QDOS, and before that to CP/M. Others built on his code and his manual; only his own voice was left half‑told.