Yeah. It's incredible how IBM handed the golden keys to the castle on a plate cut in a solid 100000000 carat diamond to Microsoft.
This has to be the absolute worst business deal ever made in history: 3 trillion market cap for Microsoft. And IBM created that.
86-DOS/PC-DOS/MS-DOS was born as a kind of throw-away OS to fill this hole temporarily. Microsoft was betting hard at the time on another OS called Xenix, which was Unix-based!
Then, somehow the industry decided that DOS was good enough, it lasted ~15+ years and this made Microsoft a fortune.
In the end, Bill Gates saw a business opportunity and acted quickly and ruthlessly. Gary Kindall, on the other hand, delayed the initial CP/M-86 development for too long.
By an irony of fate, Gary Kindall spent the rest of his career anticipating and innovating software concepts (Multiuser, Multitasking, Graphics Environment Manager, even the first encyclopedia on CD-ROM, ten years before MS Encarta) but somehow the timing was always wrong and all this never marked the return of the first CP/M glory days.
Gary Kindall was the greatest PC software pioneer, and as the old saying goes: “Pioneers take the arrows, settlers take the land”.
Lucky for them, Microsoft was happy to provide an OS badly and fast!
For other folks who remember it fondly, it's been opensourced:
In all fairness, very few recognized at the time what that would lead to.
IBM had a deep, entrenched culture that had serious dominance over all computer business. There was not an article during that time that didn't characterize the business as "Snow White and the 7 Dwarfs" where IBM was of course Snow White. Everyone else was essentially looking for crumbs. A similar example was illustrated in David Halberstam's The Dead Reckoning where General Motors was so dominant and culturally resistant to any new ideas from the outside that visitors from Japan were allowed to meet with the executives, but no discussions of the auto industry were allowed.
So in the eyes of the IBM leadership, this was a tiny, goofy idea that would not amount to much. One leader at IBM scoffed at the PC-DOS O/S calling it a toy.
Well, it was a toy that essentially ate your world.
He also made his share of deals which took a lot of value away from other companies on his own:
https://www.folklore.org/MacBasic.html
(buying MacBasic from Apple for $1 so as to kill it contine the MS-Basic license for the Apple II)
An interesting insight into this timeframe is Jerry Kaplan's _StartUp: A Silicon Valley Adventure_
https://www.goodreads.com/book/show/1171250.Startup
the whole "embrace, extend, extinguish" thing shows up as documented by folks feeling its effects.
The original IBM PCs were thoroughly unimpressive, even when compared to much cheaper 8-bit home computers.
It was much more likely that the PC would have gone the way of the Dodo like most other computer architectures of that time.