Printed in Digital Research's "Digital Dialog" internal newsletter, Vol. 1 # 1, Aug 1982. Also available in materials printed and distributed for the private 25th anniversary reunion of DRI personnel (as provided on their Web site). http://www.digitalresearch.biz/images/Reunion.Book.25.Year.pdf http://maben.homeip.net/static/S100/software/DRI/ All of us know that we're working for "the world's leading manufacturer of microcomputer systems software," as the press describes Digital Research. But there was little indication that we would reach that top spot when Gary Kildall was first trying to attach an early disk drive to his Intel development systems so he could ørun the first version of CPIM back in 1974. And no one could have predicted that a small yellow playhouse in the Kildall backyard would become the base of a company that now occupies five buildings. Or that we would grow in just five years to nearly 200 employees. Just how did it happen that Digital Research put the little town of Pacific Grove so prominently on the computer industry map? It's not a very long story, simply because the business we're in is not a very old one. According to Gary, it all really began back in 1974 when that first version of CP/M was developed and debugged. Before that there had been the achievement of a Ph.D. in computer science in 1972, teaching and research at the Naval Postgraduate School, consulting work at Intel, and the building of close relationships with many of the pioneers of microcomputing. Gary Kildall worked in his backyard playhouse with the hummingbird feeders outside the door, thinking and tinkering with his first version of CP/M - and at just the right time he got a little help from a friend. "John Torode, now president of Digital Microsystems, came to my aid with a home-built disk drive controller, which we wired up between mv Intellec-8 development system hardware and an early flexible disk drive I'd been given by Dave Scott of Shugart Associa'tes. We loaded up the first version of CP/M from a paper tape reader into the Intellec memory. With the first CP/M prompt appearing on my used Teletype in 1974, we were both aware that a new computer generation was in progress," Gary recalls. The new computer generation has resulted in a number 0 of successful companies including Digital Research. And that computer generation owes its existence, in large part, to CP/M, the first useful operating system for microcomputers. John Torode started a small company called Digital Systems, and Gary joined him to begin licensing their combined hardware and software. The first commercial licensing of CP1M took place in 1975 with contracts between Digital Systems and Omron of America and Lawrence Livermore Laboratories. For the next year Gary worked at developing facilities for his new operating system. Meanwhile, Dorothy McEwen started putting together the business side of the company. She began working with Gerry Davis on legal issues. She set up a marketing program. She took on the job of negotiating contracts. ''If it weren't for Dorothy's hard work in setting up this company," commented Marrilyn Darling, "Digital Research, as we know it, would not exist. When I came for an interview, I was amazed to find that the entire marketing and sales function was being handled by Dorothy, Hal Elgie (then director of marketing) and Barbara Norman." Gary and Dorothy filed their first fictitious business name statement in June 1976 and were incorporated in August 1977-just five years ago this month. The company'.s first name? Intergalactic Digital Research. A small consulting firm in Sausalito was calling itself Digital Research at the time; when it failed some time later, the Kildall's settled on the company's present name. In April,. 01977 the tiny new company rented a set of offices above what is now Charlie's restaurant at 716 Lighthouse Avenue. They began marketing CP1M to computer hobbyists through magazines like Dr. Dobb's Journal and to OEMs through licensing agreements. The price of the system to the hobbyist market was just $70. Dorothy remembers going down to the post office hoping to find a few checks that would keep them going a while longer. ''There was, at that time, a prevailing paranoia among software vendors who felt that any and all loose software would be immediately ripped-off by this immoral group of computer junkies," Gary has written, adding, "CP/M gradually gained popularity through a grassroots effect and, to the amazement of the skeptics, the rip-off factor was practically nil." The fledgling company began to need temporary help to fill orders and answer phones. Then they hired the first full-time employee, John Pierce. ''1 came on with the idea of doing technical support to customers," John says, "but I began taking orders on the phone, running errands, programming, everything that needed doing. We ':ill did. We continued to use part-time help, too." Soon a full-time secretarv, Portia Stade, was hired; Portia is still remembered for her long blonde hair, bare feet and shorts. There were nine employees when Digital Research moved to 801 Lighthouse'in November 1978. The Victorian building was semi-converted into offices. The previous tenant, a dentist, had built railings in the former dining room to separa~e his waiting room from his dentist's chair. This became Digital Research's conference room. However, at times more conference space was needed and groups of dark suited business men could be found conferring around picnic tables in the backyard. Barbara Norman remembers 801 with fondness. "We had about 15 people when I began," she says, "and it was ' a very close group, like a family. We had the fireplace, and we'd have hot chocklate in the morning and chat about the day before starting work. And we'd eat lunch in the back at the picnic table. 1'he programmers were out in the carriage house then and the shipping and disk making was all done inside. Later the programmers moved over to 734 Lighthouse." That move was another landmark in Digital Research history. The Victorian duplex at 734, had to be raised about six feet on jacks in order to get the VAX equipment installed, and to add a better foundation. The programmers had to climb a ladder to get into 734 because there were no outside stairs at the time. Reportedly, the whole house shook on its unsteady pilings whenever anyone inside moved about. And Digital Research continued to grow. In August 1980 with the expansion to 734, the company had 24 employees-and CP/M was becoming increasingly popular. A growing number of sytems and application software houses were using it and the ef.fect was cyclic: as CP/M was chosen more often, software developers produced more applications, which spurred more design-ins of CP/M by computer manufacturers, which generated more applications, and so on and on. By 1979, Version 2.2 had become the industry standard-and most popular operating system. And that meant tremendous growth for Digital Research. In two years, between the summer of 1980 and this summer, Digital Research has grown tlOO per cent in revenues with an increase in the number of employees from about 20 to almost 200. The two Victorian houses were bursting at their seams, so after an exhaustive search-"we looked at both of the two buildings available in Pacific Grove," Marilyn Darling recalls-the present office building at 160 Central Avenue was acquired. Golden Gate Airlines had been occupying part of the second floor, back of the present lounge. The front structure (where Marl