Edit: as another commenter rightly points out, it's likely unrelated. Here's the changelog: https://www.7-zip.org/history.txt That said the first entry at the bottom dates back to 2.00, so it's possible there was a 1.0 that predates this changelog:

2.00 Beta 1 1999-01-02 - Original beta version.

I'm pretty sure its popularity increased because it was one of the few options on Windows that was completely free to install with no nag screens, ever. It had a decent right-click menu; excellent usability for its time. And you wouldn't be tempted to use an older copy such as whatever shipped with Windows XP to extract archives. Plus it offered compatibility with all other formats including its own, and eventually apps like Firefox publicly shipped with 7zip Self-Extractors and such. And if you wanted to test whether 7zip really was more efficient, you could quickly try compressing files using different options - in my personal testing, 7zip often won back then. Not sure if results have changed recently given there are a few new compression techniques these days.

That's likely a different 7zip. The 7z format was invented in 1999, and the Wikipedia page [0] doesn't say anything about 7-bit compatibility. [0] https://en.wikipedia.org/wiki/7z