Bill Gates's betrayal of the Hacker Ethic

Published on December 4, 2012 at 22:22 GMT Share: Twitter | Facebook

The early history of hackers is centered around MIT in the 1950s and 1960s. Naturally curious and intelligent MIT students who had been exploring the phone switching network and control systems were drawn to the computers of the MIT Artificial Intelligence Lab (MIT AI Lab).
The infamous letter that changed the world forever

The early history of hackers is centered around Massachusetts Institute of Technology (MIT) in the 1950s and 1960s. Naturally curious and intelligent MIT students who had been exploring the phone switching network and control systems were drawn to the computers of the MIT Artificial Intelligence Lab (MIT AI Lab). Legendary hacker figures from this time include Peter Deutsch, Bill Gosper, Richard Greenblatt, and Jerry Sussman.

As computers spread to other parts of the country, that is, the United States, so did the hacker culture and its ethics. Largely initiated by hackers who had their beginnings at MIT, the mid 1960s saw centers of hacker culture develop at other universities such as Carnegie Mellon University, and Stanford University. Legendary hackers from this second wave include Ken Thompson, Jim Gosling, Brian Kernighan, Dennis Ritchie, and Richard Stallman.

Hackers of the current age

The third wave of hacker activity was born in northern California without direct genealogy to the MIT hackers. It started with the Homebrew Computer Club in San Francisco. It was this group of hackers, which includes legendary figures such as Steve Wozniak, Steve Jobs, and Bill Gates, that formed the foundation for the PC industry of today.

In his book, "Fighting Computer Crime: A New Framework for Protecting Information", Donn B. Parker tells us the basic principle hackers lived by during this era:

The belief that information sharing is a powerful good and that it is the ethical duty of hackers to share their expertise by writing free software and facilitating access to information . . . whenever possible.

However, on 3rd February 1976, Bill Gates wrote the infamous Open Letter to Hobbyists, which shocked the hacker community by asserting that a commercial market existed for computer software. Gates stated in the letter that software should not be copied without the publisher's permission, which he equated to piracy.

While legally correct, Gates's proposal was unprecedented in a community that was influenced by its hacker ethic, in which innovations and knowledge were freely shared in the community. Nevertheless, Gates was right about the market prospects and his efforts paid off: Microsoft Corporation became one of the world's most successful commercial enterprises, and a key player in the creation of a retail software industry.

Below is the full text of the letter that Bill Gates sent to the hacker hobbyists.

Gates's letter to the hobbyists

An Open Letter to Hobbyists

To me, the most critical thing in the hobby market right now is the lack of good software courses, books, and software itself. Without good software and an owner who understands programming, a hobby computer is wasted. Will quality software be written for the hobby market?

Almost a year ago, Paul Allen and myself, expecting the hobby market to expand, hired Monte Davidoff and developed Altair BASIC. Though the initial work took only two months, the three of us have spent most of the last year documenting, improving, and adding features to BASIC. Now we have 4K, 8K, EXTENDED, ROM and DISK BASIC. The value of the computer time we have used exceeds $40,000.

The feedback we have gotten from the hundreds of people who say they are using BASIC has all been positive. Two surprising things are apparent, however: 1) Most of these "users" never bought BASIC (less than 10% of all Altair owners have bought BASIC), and 2) The amount of royalties we have received from sales to hobbyists makes the time spent on Altair BASIC worth less that $2 an hour.

Why is this? As the majority of hobbyists must be aware, most of you steal your software. Hardware must be paid for, but software is something to share. Who cares if the people who worked on it get paid?

Is this fair? One thing you don't do by stealing software is get back at MITS for some problem you may have had. MITS doesn't make money selling software. The royalty paid to us, the manual, the tape, and the overhead make it a break-even operation. One thing you do do is prevent good software from being written. Who can afford to do professional work for nothing? What hobbyist can put 3-man years into programming, finding all bugs, documenting his product and distribute for free? The fact is, no one besides us has invested a lot of money in hobby software. We have written 6800 BASIC, and are writing 8080 APL and 6800 APL, but there is very little incentive to make this software available to hobbyists. Most directly, the thing you do is theft.

What about the guys who resell Altair BASIC, aren't they making money on hobby software? Yes, but those who have been reported to us may lose in the end. They are the ones who give hobbyists a bad name, and should be kicked out of any club meetings they show up at.

I would appreciate letters from any who wants to pay up, or has a suggestion or comment. Nothing would please me more than being able to hire ten programmers and deluge the hobby market with good software.

Bill Gates
General Partner, Micro-Soft
1180 Alvarado SE, #14
Albuquerque, NM 87108

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