After Windows 98’s live demo crash, Bill Gates had Microsoft build a secret test lab to prevent future embarrassment — “That must be why we’re not shipping yet.”

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The Blue Screen of Death, or BSoD, is a well-known error screen in Windows. It appears when a serious problem occurs, letting the user know the system has crashed or will need to restart.

The dreaded Blue Screen of Death (BSOD) actually comes in three versions. The earliest appeared in Windows 3.1 as a simple Ctrl+Alt+Del screen – often called the ‘screen of unhappiness.’ Then, Windows 95 introduced the BSOD most people recognize. Finally, Windows NT had its own version, originally created by John Vert.

Microsoft recently updated its famous blue error screen, replacing it with a simpler black screen. This change is meant to help security software work better and prevent faulty updates or drivers from crashing the system. But let’s get back to the main point…

We’ve all experienced the frustration of the Blue Screen of Death, but you’d think Microsoft wouldn’t have the same problem, especially during a big presentation. However, that’s exactly what happened when Microsoft co-founder Bill Gates was demonstrating Windows 98 on stage. This new version was set to replace Windows 95 just a few months later.

As shown in the video, the infamous Blue Screen of Death error popped up during a Windows 98 demonstration by Microsoft’s Chris Capossela, who was showcasing the ease of using USB devices. Bill Gates reportedly quipped, “That must be why we’re not shipping Windows 98 yet,” likely to deflect from the embarrassing glitch (according to PC Gamer).

What happened at Microsoft after the incident isn’t fully known, but it led to a complete overhaul of how the company managed its broadcasts and live events.

Microsoft was building a new studio, Microsoft Production Studios, on its Redmond campus at the time. Veteran engineer Raymond Chen says the Blue Screen of Death that happened during the Windows 98 demo actually led to changes in the studio’s design.

To support live broadcasts, they added a room right next to the broadcast studio to house and prepare all the necessary computer equipment. Technicians would set up and test everything in this room before the hosts began the show.

Chen describes the exterior of Microsoft Studios as unremarkable, but says the inside is a different story. It’s a state-of-the-art broadcast studio with a spacious, mostly empty black room, a massive LED screen for backgrounds, and a wealth of high-end audio and video equipment.

Chen explained in another post that the Blue Screen of Death during the Windows 98 demo happened because the team unexpectedly switched scanners. They used a scanner they’d quickly purchased from a local store instead of the one they’d thoroughly tested. This new scanner tried to pull too much power from the USB port, which caused the system to crash.

Microsoft has been testing ways to avoid similar issues when filming marketing videos and presentations, and according to Chen, those efforts have been successful so far.

We didn’t throw the scanner away. It actually became a bit of a legend at Microsoft! One of our engineering managers mounted it on a World War II helmet and wore it to all the remaining project meetings in the War Room. It was a fun, quirky piece of our development process.

FAQ

What is a BSoD?

The Blue Screen of Death is an error message Windows displays when a serious problem occurs. It means the system has crashed or is about to, and the computer will likely restart automatically.

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2025-11-07 17:39