Traf-O-Data was a business partnership between Bill Gates, Paul Allen and Paul Gilbert that existed in the 1970s. 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 instrumental in the creation of Microsoft Corporation a few years later. Traffic counting State and local governments frequently perform traffic surveys with a pneumatic road tube traffic counter. Rubber hoses are stretched across a road and wheels of passing vehicles create air pulses that are recorded by a roadside counter. In the 1970s 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 common Teletype paper tape uses only 7 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 by building a computer that could process all the traffic tapes using the Intel 8008 processor. The goal was to sell such machines to states and local governments as a time and cost-saving tool. Since Gates and Allen did not know how to build a computer capable of processing data on paper tapes, they recruited Paul Gilbert to help in building a prototype that can manually read the hole-patterns in the paper tape and transcribe the data onto computer cards. Gilbert became the third partner. 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. Traf-O-Data hardware 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. Gates and Allen had a friend, Paul Wennberg, who, like them, loitered at