February 12, 2013
Before founding Microsoft, Bill Gates and Paul Allen had a different venture. While still high school students in the 1970s, they formed a company, Traf-O-Data to read the data from traffic data recorders and create reports for traffic engineers. Looking back, the business seems like it was from another century (which it was).
The old data recorders used paper punch tape ... a rather archaic form of information storage that might only be correctly identified by a handful of high school students today. Bill and Paul's classmates, however, became very familiar with reading the tapes, as they transcribed the information onto computer punch cards (yet another ancient form of data storage that few of today's high school students have seen).
Gates and Allen eventually teamed up with Paul Gilbert "the hardware guy," to build a device to read the paper tapes, using the new Intel 8008 microprocessor. Traf-O-Data ran its course after Washington State began offered data services directly to municipalities, which eliminated the need for outside contractors. This experience laid the groundwork for the ultimate success of Microsoft.
"Traf-O-Data as a business was kind of an underwhelming failure. I think we made a few dollars from it, but it wasn't a rocket taking off at all, like the BASIC was. It kind of landed with a thud. We were trying to compete with states that were giving away this traffic processing." - Paul Allen