[jasode]

Yes, the .NET SDK had a command line compiler so theoretically, it could compile .cs files for free. However, nobody used it for serious Windows Forms GUI type of work. Realistically, corporations and hobbyists had to buy VS Studio to write non-trivial apps. On the other hand, people were writing Java GUI apps with free tools. Eclipse was free back in 2001 before .NET 1.0 was released.

The only common use case I remember for the free C# command line compiler was to type in exercises from C# tutorials.

Also, even if compiling C# source code was free, the execution stack for the NET runtime was not free. MS Windows operating system licenses and MS SQL Server cost money. In comparison, Linux and MySQL were free. The different costs for deployment affected social dynamics as well.