Traf-O-Data was a partnership between Bill Gates, Paul Allen, and Paul Gilbert. The objective was to read the raw data from roadway traffic counters and create reports for traffic engineers. The company had only modest success but the experience was important in the creation of Microsoft a few years later.
State and local governments frequently do traffic surveys with a pneumatic road tube traffic counter. Rubber hoses are stretched across a road and passing vehicles create air pulses that are recorded by a roadside counter. In 1970 the counts were mechanically recorded on a roll of paper tape. The time and number of axles were punched as a 16 bit pattern into the paper tape. (The standard Teletype paper tape uses only 8 bits.) Cities would hire private companies to translate the data into reports that traffic engineers could use to adjust traffic lights or improve roads.
Bill Gates and Paul Allen were high school students at Lakeside School in Seattle. The Lakeside Programmers Group got free computer time on various computers in exchange for writing computer programs. Gates and Allen thought they could process the traffic data cheaper and faster than the local companies. They recruited classmates to manually read the hole-patterns in the paper tape and transcribe the data onto computer cards. Gates then used a computer at the University of Washington to produce the traffic flow charts. (Paul Allen's father was a librarian at UW.) This was the beginning of Traf-O-Data.
The next step was to build a device to read the traffic tapes directly and eliminate the tedious manual work. The Intel 8008 microprocessor was announced in 1972 and they realized it could read the tapes and process the data. Allen had graduated and was enrolled at Washington State University. Since neither Gates nor Allen had any hardware design experience they were initially stumped. The computer community in Seattle at that time was relatively small. Gates and Allen had a friend, Paul Wennberg, who -- like them -- had hung around CDC Corporation near the University of Washington cadging open time on the mainframe. Wennberg, founder of the Triakis Corporation, was then an electrical engineering student at the University of Washington. In the course of events Gates and Allen mentioned they were looking for somebody to build them a computer for free. They needed somebody good enough to build a computer from parts and the diagrams found in a computer magazine. It was Wennberg who came up with the man to do just that. After discussion with another friend, Wes Prichard, Prichard suggested to Wennberg that Gates and Allen head over UW Physics building to where Gilbert, another EE student, worked in the high-energy tracking lab. It was there that Paul Gilbert was approached by the duo to become a partner in Traf-O-Data.
That year Gilbert, piece by piece, wire wrapped, soldered, and assembled from electrical components the working microcomputer. Miles Gilbert, Paul Gilbert's brother, a graphic designer and draftsman, helped the fledgling company by designing the company's logo. Gates and Allen started writing the software. To test the software while the computer was being designed, Paul Allen wrote a computer program on WSU's IBM 360 that would emulate the 8008 microprocessor.
Although the plan had been to manufacture and sell the machines:
- "...when the guy from the County that Seattle's in came to see it, it didn't work. We ended up being okay successful, not seriously successful ... just by processing the tapes. At first that was a very manual process. Then we used this prototype machine that we built to do that. So, we made a little bit of money and had some fun with it." - Bill Gates
Later the State of Washington offered free traffic processing services to cities, ending the need for private contractors, and all three principals moved on to other projects. The real contribution of Traf-O-Data was the experience that Gates and Allen gained, skills they used to write Altair BASIC for the MITS Altair 8800 computer:
- "Even though Traf-O-Data wasn't a roaring success, it was seminal in preparing us to make Microsoft's first product a couple of years later. We taught ourselves to simulate how microprocessors work using DEC computers, so we could develop software even before our machine was built." - Paul Allen
- "Traf-O-Data". New Mexico Museum of Natural History and Science. Retrieved 2011-05-08.
- Wallace, James; Jim Erickson (1992). Hard Drive: Bill Gates and the Making of the Microsoft Empire. John Wiley & Sons. pp. 42–46. ISBN 0-471-56886-4.
- "Early Days as a Computer Programmer", October 27, 2011 thegatesnotes.com
- "Using an 8008 Processor", Bill Gates Interview, Smithsonian
- "Interview with Bill Gates and Paul Allen", October 1995, Fortune Magazine (via CNN)