A bulletin board system or BBS (also called Computer Bulletin Board Service, CBBS) is a computer server running software that allows users to connect to the system using a terminal program. Once logged in, the user can perform functions such as uploading and downloading software and data, reading news and bulletins, and exchanging messages with other users through public message boards and sometimes via direct chatting. In the early 1980s, message networks such as FidoNet sprang up to provide services such as NetMail, which is similar to internet based email.

Many BBSes also offer online games in which users can compete with each other. BBSes with multiple phone lines often provide chat rooms, allowing users to interact with each other. Bulletin board systems were in many ways a precursor to the modern form of the World Wide Web, social networks, and other aspects of the Internet. Low-cost, high-performance modems drove the use of online services and BBSes through the early 1990s. InfoWorld estimated that there were 60,000 BBSes serving 17 million users in the United States alone in 1994, a collective market much larger than major online services such as CompuServe.

The introduction of inexpensive dial-up internet service and the Mosaic web browser offered ease of use and global access that BBS and online systems did not provide, and led to a rapid crash in the market starting in 1994. Most surviving BBSes are accessible over Telnet and typically offer free email accounts, FTP services, IRC (Internet Relay Chat) and all the protocols commonly used on the Internet.

A precursor to the public bulletin board system was Community Memory, started in August 1973 in Berkeley, California. Useful microcomputers did not exist at that time, and modems were both expensive and slow. Community Memory therefore ran on a mainframe computer and was accessed through terminals located in several San Francisco Bay Area neighborhoods. The poor quality of the original modem connecting the terminals to the mainframe prompted Community Memory hardware person, Lee Felsenstein, to invent the Pennywhistle modem, whose design was highly influential in the mid-1970s.

Early modems were generally very simple devices using acoustic couplers to handle telephone operation. The user would first pick up the phone, dial a number, then press the handset into rubber cups on the top of the modem. Disconnecting at the end of a call required the user to pick up the handset and return it to the phone. Examples of direct-connecting modems did exist, and these often allowed the host computer to send it commands to answer or hang up calls, but these were very expensive devices used by large banks and similar companies.

The first public dial-up BBS was developed by Ward Christensen and Randy Suess. According to an early interview, when Chicago was snowed under during the Great Blizzard of 1978, the two began preliminary work on the Computerized Bulletin Board System, or CBBS.

A key innovation required for the popularization of the BBS was the Smartmodem manufactured by Hayes Microcomputer Products. Internal modems like the ones used by CBBS and similar early systems were usable, but generally expensive due to the manufacturer having to make a different modem for every computer platform they wanted to target. They were also limited to those computers with internal expansion, and could not be used with other useful platforms like video terminals. External modems were available for these platforms but required the phone to be dialed using a conventional handset, making them unable to accept incoming calls without manual intervention. Internal modems could be software controlled to perform both outbound and inbound calls, but external modems had only the data pins to communicate with the host system.

Hayes' solution to the problem was to use a small microcontroller to implement a system that examined the data flowing into the modem from the host computer, watching for certain command strings. This allowed commands to be sent to and from the modem using the same data pins as all the rest of the data, meaning it would work on any system that could support even the most basic modems. The Smartmodem could pick up the phone, dial numbers, and hang up again, all without any operator intervention. The Smartmodem was not necessary for BBS use but made overall operation dramatically simpler. It also improved usability for the caller, as most terminal software allowed different phone numbers to be stored and dialed on command, allowing the user to easily connect to a series of systems.

Speed improved with the introduction of 1200 bit/s modems in the early 1980s, giving way to 2400 bit/s fairly rapidly. The improved performance led to a substantial increase in BBS popularity. Most of the information was displayed using ordinary ASCII text or ANSI art, but a number of systems attempted character-based graphical user interfaces which began to be practical at 2400 bit/s.

There was a lengthy delay before 9600 bit/s models began to appear on the market. 9600 bit/s was not even established as a strong standard before V.32bis at 14.4 kbit/s took over in the early 1990s. This period also saw the rapid rise in capacity and a dramatic drop in the price of hard drives. By the late 1980s, many BBS systems had significant file libraries, and this gave rise to leeching, users calling BBSes solely for their files.

The demand for complex ANSI and ASCII screens and larger file transfers taxed available channel capacity, which in turn propelled demand for faster modems. 14.4 kbit/s modems were standard for a number of years while various companies attempted to introduce non-standard systems with higher performance, normally about 19.2 kbit/s. Another delay followed due to a long V.34 standards process before 28.8 kbit/s was released, only to be quickly replaced by 33.6 kbit/s, and then 56 kbit/s.

In the early days, the file download library consisted of files that the SysOps obtained themselves from other BBSes and friends. Many BBSes inspected every file uploaded to their public file download library to ensure that the material did not violate copyright law. As time went on, shareware CD-ROMs were sold with up to thousands of files on each CD-ROM. Some BBSes, called elite, WaReZ or pirate boards, were exclusively used for distributing cracked software, phreaking, and other questionable or unlawful content.

Much of the shareware movement was started via user distribution of software through BBSes. A notable example was Phil Katz's PKARC (and later PKZIP, using the same ".zip" algorithm that WinZip and other popular archivers now use); also other concepts of software distribution like freeware, postcardware like JPEGview and donationware like Red Ryder for the Macintosh first appeared on BBS sites. Doom from id Software and nearly all Apogee Software games were distributed as shareware (Apogee is, in fact, credited for adding an order form to a shareware demo). The Internet has largely erased the distinction of shareware – most users now download the software directly from the developer's website rather than receiving it from another BBS user 'sharing' it. Today shareware is commonly used to mean electronically distributed software from a small developer.

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