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Childhood friends Bill Gates and Paul Allen sought to make a business utilizing their shared skills in computer programming. In 1972 they founded their first company, named Traf-O-Data, which sold a rudimentary computer to track and analyze automobile traffic data. While Gates enrolled at Harvard, Allen pursued a degree in computer science at Washington State University, though he later dropped out of school to work at Honeywell. The January 1975 issue of Popular Electronics featured Micro Instrumentation and Telemetry Systems's (MITS) Altair 8800 microcomputer, which inspired Allen to suggest that they could program a BASIC interpreter for the device. After a call from Gates claiming to have a working interpreter, MITS requested a demonstration. Since they didn't yet have one, Allen worked on a simulator for the Altair while Gates developed the interpreter. Although they developed the interpreter on a simulator and not the actual device, it worked flawlessly when they demonstrated the interpreter in March 1975 to MITS in Albuquerque, New Mexico. MITS agreed to distribute it, marketing it as Altair BASIC. :108, 112–114 Gates and Allen officially established Microsoft on April 4, 1975, with Gates as the CEO. The original name of "Micro-Soft" (short for microcomputer software) was suggested by Allen. In August 1977 the company formed an agreement with ASCII Magazine in Japan, resulting in its first international office, "ASCII Microsoft". Microsoft moved its headquarters to Bellevue, Washington in January 1979.

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