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Microsoft usually makes small purchases, but occasionally those small purchases pay off huge.
Every company has a different acquisition strategy. In the 1990s, Symantec seemed to buy any company that would say yes. The result was a company with system repair tools, security software, compilers and various sundry utilities.
Other companies, like Microsoft and Apple, perform small, strategic acquisitions of companies that give them what comes down to a component or a piece of the larger puzzle. When Microsoft makes those strategic purchases, it has paid off handsomely. Although you might not realize it, some of Microsoft's most-used products were bought out.
This wasn't technically an acquisition, but it wasn't Microsoft home brew, either. SQL Server was a Sybase product that ran on Unix. The company teamed with Microsoft and Ashton-Tate in 1989, maker of the once-dominant dBASE database software to port SQL Server to OS/2, back when Microsoft was still an OS/2 supporter. Ashton-Tate dropped out, and in 1992, Microsoft and Sybase ported SQL Server to Windows NT. The two companies split in 1994, with Microsoft taking sole development lead. But it hadn't gotten rid of all of the Sybase code until SQL Server 2005 came out. Now Microsoft SQL Server is a major competitor to Oracle, and Sybase has all but vanished as a significant RDBMS vendor.
Originally designed for the Macintosh under the name "Presenter," this software was renamed PowerPoint due to a trademark issue. Robert Gaskins, its developer, managed to release three versions in short order before Microsoft came calling in August 1987 and purchased it for $14 million. PowerPoint became Microsoft's Graphics Business Unit and eventually a vital part of Microsoft Office, which first appeared in 1992.
Today, most of us throw around HTML tags like it's nothing, but back in the early days of the Internet, coding an HTML page was about as arcane to most folks as C programming. So to get a jump on things, Microsoft bought FrontPage and its developer, Vermeer Technologies, in 1996.
FrontPage was initially bundled with Windows NT 4.0 Server, which came with a Web server, called Internet Information Services 2.0 (IIS). It would later be added to the Microsoft Office lineup with Office 97 and subsequently renamed FrontPage Server Extensions (FPSE). Microsoft discontinued Microsoft FrontPage in December 2006 but its replacement, Microsoft Expression, had been released one year earlier and was making headway as the Web page editor of choice.
Another example of Microsoft jumpstarting its Internet business. It bought Hotmail, then rendered as HoTMaiL, in 1997 for $400 million. It was one of the first Web-based mail services, along with Yahoo Mail, which was also an acquisition. Yahoo bought RocketMail from a startup called Four11. Microsoft renamed the service MSN Hotmail.
It would be surpassed by Google Mail, and after falling into decay and misuse Hotmail became a home for spammers. In 2011, Microsoft decided to whip the service into shape, but its reputation was ruined at that point. Plus, Microsoft had a second mail service, Windows Live Mail, so it merged Hotmail and Live Mail into one new brand, Outlook.com.
Visio shows how life can be for an entrepreneur in the tech industry. In 1984, Jeremy Jaech and Dave Walter co-founded one of the first desktop publishing firms, Aldus, inspired by the Macintosh. Aldus's PageMaker used Adobe PostScript technology and finally Adobe decided it needed a DTP package and bought Aldus in 1994.
Prior to that, in 1992, Jaech and Walter started a new company, called Visio. Again, they focused on visual design on the screen. In this case, Visio did flow charting, visual diagrams and layout designs. This time, Microsoft came calling and paid $1.5 billion in stock for Visio in 2001. Visio has since become a part of Office.
Microsoft had initially blown off the Internet revolution in the early 1990s before Bill Gates came to his senses. After falling well behind in the browser wars, the company jumpstarted its efforts with the license of NCSA's Mosaic browser from Spyglass, the company spun out of the NCSA to sell Mosaic licenses. It turned out to be a tangled deal, costing Microsoft a total of $10 million and giving Spyglass a look at the IE code for audit purposes. That ended with IE7.
GIANT Antispyware was once a competitor of Webroot in eradicating the new category of spyware software, which, unlike viruses, hid on your computer and looked for certain keystrokes, such as the login and password to your online bank account.
Microsoft purchased GIANT in 2004 and renamed it Microsoft AntiSpyware before renaming it Windows Defender one year later. It would eventually be superceded by Microsoft Security Essentials, which broadened the level of coverage and protection beyond just spyware.
When Intel introduced the 8086 processor (which it did not develop either, go figure), IBM planned to make a computer for it and originally contacted the creator of the CP/M OS, Gary Kildall. Gary's wife refused to sign an NDA with IBM to discuss a license deal, so IBM turned to Microsoft. Microsoft in turn bought the rights to the Quick-and-Dirty Operating System, or Q-DOS, from Seattle Computer Products, which was very CP/M-like. Microsoft didn't tell SCP about the IBM deal and managed to convince IBM to let it market MS-DOS separate from the PC. Now that's chutzpah.