Beginnings
The Lotus Development Corporation was founded by Mitchell Kapor, a friend of the developers of VisiCalc. 1-2-3 was originally written by Jonathan Sachs, who had written two spreadsheet programs previously while working at Concentric Data Systems, Inc. To aid its growth, in the UK, and possibly elsewhere, Lotus 1-2-3 was the very first computer software to use television consumer advertising.
1-2-3 was released on January 26, 1983 and immediately overtook Visicalc in sales. Unlike Microsoft Multiplan, it stayed very close to the model of VisiCalc, including the "A1" letter and number cell notation, and slash-menu structure. It was cleanly programmed and relatively bug-free, as well as speed gained from being written completely in x86 assembly language (this remained the case for all versions until 3.0 when Lotus switched to C) and wrote directly to video memory rather than use the slow DOS and/or BIOS text output functions.
This reliance on the specific hardware of the IBM PC led to 1-2-3 being utilized as one of the two litmus test applications for true 100% compatibility when PC clones started to appear in the early- to mid- 80s. 1-2-3 was used to test general application compatibility, with Microsoft Flight Simulator being used to test graphics compatibility. Because spreadsheets use large amounts of memory, 123 spurred the drive for greater RAM capacities in PCs and especially the event of "expanded memory" which allowed greater than 640k to be accessed.
Lotus 123 became the first "killer app" for PC compatibles, especially as it was available exclusively on that platform and no other computers. Many thousands of PCs were sold solely for the purpose of running 123, and its near-monopoly of the spreadsheet market remained unchallenged for a decade.
Read more about this topic: Lotus 1-2-3
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