Bell Labs, the developer of Unix, was part of the regulated
Bell System and could not sell Unix directly to most end users (academic and research institutions excepted); it could, however, sell it to software vendors who would then resell it to end users (or their own resellers), combined with their own added features. Microsoft, which expected that Unix would be its operating system of the future when personal computers became powerful enough, purchased a license for
Version 7 Unix from AT&T in 1978, and announced on August 25, 1980, that it would make the software available for the
16-bit microcomputer market. Because Microsoft was not able to license the "Unix" name itself, the company gave it an original name. While "
MS-DOS will become the premier single-user operating system", said Microsoft cofounder
Paul Allen, his company "hopes that Xenix will become the preferred choice for software production and exchange", it stated in 1981. MS-DOS was Microsoft's "single-user, single-tasking operating system", which can run from floppy disks. Xenix, Allen said, "really should be used with a hard disk". MS-DOS and Xenix are "part of a family ... with a clear migration path", he added, promising binary compatibility of Xenix-compiled C software with MS-DOS, and interoperability of Xenix-based
file servers and MS-DOS
application servers. The company advised customers who wanted
multiuser or
multitasking support to buy Xenix. Microsoft expected that MS-DOS would become almost indistinguishable from single-user Xenix, or
XEDOS, which would also run on the 68000, Z8000, and LSI-11; they would be
upwardly compatible with Xenix, which
Byte in 1983 described as "the multi-user MS-DOS of the future". Microsoft's Chris Larson described MS-DOS 2.0's Xenix compatibility as "the second most important feature". His company advertised DOS and Xenix together, describing MS-DOS 2.0 (its "single-user OS") as sharing features and
system calls with Xenix ("the multi-user, multi-tasking, Unix-derived operating system"), and promising easy porting between them. Microsoft called Xenix "a universal operating environment". It did not sell Xenix directly to end users, but licensed the software to
OEMs. Microsoft received $500 for each single-user copy sold by companies such as IBM, Intel, Management Systems Development,
Tandy,
Altos Computer, SCO, and Siemens (
SINIX) which then
ported it to their own proprietary
computer architectures. In 1981, Microsoft said the first version of Xenix was "very close to the original Unix version 7 source" on the
PDP-11, and later versions were to incorporate its own fixes and improvements. The company stated that it intended to port the operating system to the
Zilog Z8000 series, Digital
LSI-11,
Intel 8086 and
80286,
Motorola 68000, and possibly "numerous other processors", and provide Microsoft's "full line of system software products", including
BASIC and other languages. The first port was for the Z8001 16-bit processor: the first customer ship was January 1981 for Central Data Corporation of Illinois, Intel sold complete computers with Xenix under their Intel
System 86 brand (with specific models such as 86/330 or 86/380X); they also offered the individual boards that made these computers under their
iSBC brand. This included processor boards like iSBC 86/12 and also MMU boards such as the iSBC 309. The first Intel Xenix systems shipped in July 1982. Tandy more than doubled the Xenix installed base when it made TRS-Xenix the default operating system for its
TRS-80 Model 16 68000-based computer in early 1983, and was the largest Unix vendor in 1984.
Seattle Computer Products also made (PC-incompatible) 8086 computers bundled with Xenix, like their Gazelle II, which used the
S-100 bus and was available in late 1983 or early 1984. There was also a port for
IBM System 9000. SCO had initially worked on its own PDP-11 port of V7, called Dynix, but then struck an agreement with Microsoft for joint development and technology exchange on Xenix in 1982. Microsoft and SCO then further engaged
Human Computing Resources Corporation (HCR) in Canada, and a software products group within
Logica plc in the United Kingdom, as part of making further improvements to Xenix and porting Xenix to other platforms. In 1984, a port to the 68000-based
Apple Lisa 2 was jointly developed by SCO and Microsoft and it was the first
shrink-wrapped binary product sold by SCO. The
Multiplan spreadsheet was released for it. In its 1983 OEM directory, Microsoft said the difficulty in porting to the various 8086 and Z8000-based machines had been the lack of a standardized
memory management unit and protection facilities. Hardware manufacturers compensated by designing their own hardware, but the ensuing complexity made it "extremely difficult if not impossible for the very small manufacturer to develop a computer capable of supporting a system such as Xenix from scratch," and "the Xenix kernel must be custom-tailored to each new hardware environment". A generally available port to the unmapped
Intel 8086/8088 architecture was done by The Santa Cruz Operation around 1983. SCO Xenix for the PC XT shipped in 1984 and contained some enhancement from
4.2BSD; it also supported the
Micnet local area networking. While Unix was still rare in companies during the second half of the 1980s, Xenix was probably the most commonly installed Unix. The 286 version of Xenix used the integrated MMU present on this chip, by running in
286 protected mode. The 286 Xenix was accompanied by new hardware from Xenix OEMs. For example, the
Sperry PC/IT, an
IBM PC AT clone, was advertised as capable of supporting eight simultaneous
dumb terminal users under this version. While Xenix 2.0 was still based on Version 7 Unix, version 3.0 was upgraded to a
Unix System III code base, a 1984 Intel manual for Xenix 286 noted that the Xenix kernel had about 10,000 lines at this time.
Transfer of ownership to SCO After the
breakup of the Bell System in 1984, AT&T started selling System V. Microsoft, believing that it could not compete with Unix's developer, decided to abandon Xenix. The decision was not immediately transparent, which led to the term
vaporware. Although Gates in November 1985 wrote "In the next 18 months, there is a good chance that Xenix system installations will be able to surpass the 400,000 system mark and achieve critical mass", he said that MS-DOS and Xenix "are separate products that address different markets" and "Microsoft does not intend to merge them into one OS"; in particular, "Multi-user capability will
never be a feature of MS-DOS". His company agreed with
IBM to develop
OS/2, and its Xenix team (together with the best MS-DOS developers) was assigned to that project. In 1987, Microsoft transferred ownership of Xenix to SCO in an agreement that left Microsoft owning slightly less than 20% of SCO (this amount prevented both companies from having to disclose the exact amount in the event of an SCO IPO). SCO would acquire both of the other companies that had Xenix rights, When Microsoft eventually lost interest in OS/2 as well, the company based its further high-end strategy on
Windows NT. In 1987,
SCO ported Xenix to the
386 processor, a
32-bit chip, after securing knowledge from Microsoft insiders that Microsoft was no longer developing Xenix. The company submitted a patch to support functionality in Unix to AT&T that year, which trickled down to the code base of both Xenix and SCO Unix. Microsoft is said to have used Xenix on
Sun workstations and
VAX minicomputers extensively within their company as late as 1988. All internal Microsoft email transport was done on Xenix-based 386/486 systems until 1996, when the company moved to its own
Exchange Server product. Microsoft chairman
Bill Gates said at
Unix Expo in 1996 that, for a long time, Microsoft had the highest-volume AT&T Unix license.
Replacement By 1988 AT&T reported that Xenix developers were about half of the 500,000 Unix licenses worldwide. SCO released its
SCO Unix as a higher-end product, based on System V R3 and offering a number of technical advances over Xenix; Xenix remained in the product line. In the meantime, AT&T and
Sun Microsystems completed the merge of Xenix, BSD,
SunOS and System V R3 into System V R4. The last version of SCO Xenix/386 itself was System V R2.3.4, released in 1991. ==Features==