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The "magic" is that the TLD is reserved for internal use. Before, people used different domains like ".lan", ".local". Problem with those is that it can happen at any time that one of these becomes a valid TLD which can cause a lot of unexpected side effects (starting from "cannot reach somenicepage.lan because my local DNS resolved *.lan" to "someone registered server.lan and can not issue valid SSL certificates for my internal service").

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Indeed, that has certainly happened to .local, which Microsoft once recommended using for internal purposes - before mDNS came about and .local wound up being used for mDNS instead.

mDNS drafts actually date back to around 2000, which AFAICT precedes Microsoft's use.

It's around the same time, I think. Windows 2000 & Active Directory were released in February 2000; MS training materials would have been released around the same time. I found at least one book[1] published in the year 2000 that discussed using .local as a private TLD.

[1] https://www.uv.es/martineu/ad/bibliaAD.pdf

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