April 2, 1979: Microsoft releases its first hardware product, a microprocessor card that plugs into the Apple II computer.
Coming several years before the first version of Windows, the Z80 SoftCard becomes a big hit for Microsoft. It lets the Apple II run programs designed for the CP/M operating system, a popular OS for business software.
Microsoft, the hardware company?
A straightforward plug-and-play peripheral for the Apple II, the Z80 SoftCard contained a Zilog Z80 CPU and the necessary “decoding circuitry” to read the signals on the Apple computer’s bus.
It allowed the Apple II to run much more business software, most notably the popular word processor WordStar, which required a Z80 CPU.
At the time of its introduction, InfoWorld magazine referred to the SoftCard as a “fascinating piece of hardware.”
“If you need a lightweight, portable Z80 computer, the Apple/SoftCard combination is a perfect pair,” the publication concluded.
Microsoft Z80 SoftCard is a hit
The $349 card (the equivalent of a hefty $1,342 in 2021) was, in some ways, a surprise hit for Microsoft. Coming packaged with Microsoft BASIC, it debuted at the West Coast Computer Faire in March 1980, before going on sale the following month. In its first three months, Microsoft sold 5,000 units — considered a big success at the time.
In fact, the Z80 SoftCard remained Microsoft’s most successful product until the company introduced a mouse in 1983. By 1980, the Z80 SoftCard became Microsoft’s No. 1 revenue source.
Microsoft continued its involvement with Apple as a developer for the next few years — albeit increasingly in software. By the mid-1980s, Microsoft became one of Apple’s most valuable developers. So much so that Apple CEO John Sculley signed a damaging contract to keep Bill Gates and Co. hanging around.
By the end of the 1980s, Microsoft achieved great success with Windows. The PC operating system proved so popular that Microsoft challenged Apple in the marketplace. For the next 20 years, the familiar Windows software-based business model versus Apple’s own-everything-we-make approach would dominate the tech industry.
In recent years, Microsoft accelerated its hardware push with its Surface lineup. The Surface Duo, released in 2020, is a foldable phablet that runs on Android and starts at $1,399.99.