In early 1976, Micro-Soft had a problem that looked nothing like a software bug. Altair BASIC, the interpreter Gates and Allen had written for the Altair 8800, was wildly popular among hobbyists, but most of them were running copies they had never paid for. Paper tapes of the interpreter were passed hand to hand at meetings of groups like the Homebrew Computer Club, where sharing programs was simply how the community worked.
Bill Gates, then twenty, answered with words rather than lawyers. His “An Open Letter to Hobbyists” appeared in the Homebrew Computer Club Newsletter, Volume 2, Issue 1, dated February 3, 1976. The tone was sharp and personal. Gates wrote that “as the majority of hobbyists must be aware, most of you steal your software,” estimating that “less than 10% of all Altair owners have bought BASIC,” and he framed the copying in blunt moral terms: “the thing you do is theft.” His central argument was economic: “who can afford to do professional work for nothing?” If hobbyists wanted good software, he insisted, someone had to be paid to write it.
The letter landed in a community whose culture ran the opposite way. To many in the Homebrew Computer Club, freely copying and improving each other’s programs was the whole point, a hacker ethic of shared knowledge, not theft. Gates’s letter read to them as an outsider declaring their normal practice criminal, and it provoked angry replies. The disagreement was not really about one BASIC interpreter; it was about whether software should be owned or shared.
That clash never fully resolved, which is why the letter still matters. It is one of the earliest clear statements of the proprietary-software position, written at the very moment a hobby was turning into an industry, and it stands as an origin point for a debate that runs straight through to the free-software and open-source movements that followed. Decades later it remains a touchstone, a short, combative document in which the culture of selling software and the culture of sharing it first squared off in print.