There are a few pivotal moments in history that set the course for years and decades to come, and that extends to the tech world, too. With Windows, Microsoft today dominates the computing landscape, and you can trace that success back to the company's purchase of 86-DOS, the operating system that would soon be rebranded as MS-DOS and make Microsoft one of the biggest companies in the world.

That acquisition of 86-DOS happened 43 years ago to this day — on July 27, 1981 —costing Microsoft a breezy $50,000. Certainly nothing in comparison to the kind of money the company is generating today.

Microsoft and IBM needed 86-DOS

The software heart of the first IBM PC

In 1980, IBM was preparing to launch its very first IBM Personal Computer (PC), which would essentially give birth to the term PC as we know it today. The IBM PC was the company's first attempt at penetrating the consumer market after focusing on businesses for many years, and it was set to take on the increasingly popular Macintosh from Apple. To do so, IBM created a group known as Project Chess, which sought to quickly develop the device.

The IBM PC needed an operating system, and that's where Microsoft comes in. IBM contracted Microsoft to develop an operating system that would run on the IBM PC, and Microsoft in turn acquired a non-exclusive license from Seattle Computer Products (SCP) to port 86-DOS to the IBM PC. 86-DOS was a great choice because it looked similar to the existing CP/M operating system and apps could easily be ported from one to the other, but it would run on the Intel 8086 processor IBM was going with. This happened at the tail end of 1980, and it was just two weeks before the IBM PC would launch that Microsoft acquired full rights to the 86-DOS operating system, renaming it to MS-DOS, which it licensed to IBM to be sold under the name PC DOS.

Microsoft didn't put all its eggs in one basket, though, and within just one year from the initial purchase, Microsoft had licensed over 70 copies of MS-DOS, meaning just as many companies were able to use it on their computers. This was the beginning of a journey of huge growth for Microsoft's operating system ambitions.

The 86-DOS deal didn't sit well with everyone

SCP got the short end of the stick

Given the blowout success of MS-DOS and PC DOS, Microsoft's deal with SCP was a major win in just about every way. Except if you were SCP. Having sold off its biggest asset in exchange for a license to keep using MS-DOS, SCP tried to stay relevant in the computer market, but by 1985, the company was struggling to stay afloat.

SCP took Microsoft to court over various unfair practices. For one thing, Microsoft had omitted its intention to license 86-DOS to IBM for the IBM PC, which caused the company to sell its rights for a relatively low price. SCP also believed that Microsoft wasn't providing it with access to the latest versions of MS-DOS for use in its hardware, which was part of the original agreement.

Microsoft and SCP ended up settling the case out of court, with Microsoft paying nearly $1 million and retaining the rights to MS-DOS. By this time, Microsoft's profits from licensing MS-DOS were already far higher than that, so the lawsuit was more or less inconsequential in the long run.

The beginning of a long journey

MS-DOS has a huge legacy

In light of the huge success of MS-DOS, Microsoft naturally kept developing the operating system for years to come, and it's become one of the most widely-recognized pieces of tech history. It wasn't too long until Microsoft took MS-DOS and built something greater from it; in 1985, the company launched Windows 1.0, the first version of the graphical operating system we know today, built on top of MS-DOS 2.0.

From there, MS-DOS and Windows were closely related for over a decade. Microsoft supported MS-DOS until 2006, with the latest major release — MS-DOS 8.0 — happening in 2000 as part of Windows Me. This was the last version of Windows to be based on MS-DOS before it was completely superseded by the Windows NT kernel, which is still used in Windows 11 today.

While MS-DOS didn't get another proper release, in 2015 Microsoft released MS-DOS Mobile, an app for Windows phones that capitalized on the nostalgia for the operating system. This was a very cool app that used a text-based interface for some simple tasks like viewing the time, opening your contacts list, and even a camera app that pixelated all your photos (this was my personal favorite feature). The fact that Microsoft bothered to make such a fun concept on a nearly dead platform at the time shows how much of an impact MS-DOS had on the world. And you can trace it all back to that fateful day in 1981.