NCERD IT Timeline

A Short Biography of IBM (1896 - 1997)


Genesis

Following on from his success at the Census Bureau, in 1896 Herman Hollerith formed the Tabulating Machine Company. In 1911 his company merged with two others to form the Computing-Tabulating-Recording Company. Under the general managership of Thomas J Watson, CTR expanded into international markets and became International Business Machines (IBM) in 1924.

During the Great Depression of the 1930s IBM Watson kept the employess at work producing new machines. When the US Social Security Act of 1935 was extablished IBM won the contract to maintain employment records for 26 million people. It was called "the biggest accounting operation of all time," and it went so well that orders from other U.S. government departments quickly followed.

The First Commercial Computers

During the Second World Ward and after, IBM started to take its first steps toward computers. It sponsored the development of the Harvard Mark 1 and in 1952 introduced the IBM 701, its first large computer based on the vacuum tube. The tubes were quicker, smaller, and more easily replaceable than the electromechanical switches in the Mark I. The 701 executed 17,000 instructions per second and was used primarily for government and research work.


The Harvard Mark 1

In 1952, the company introduced the IBM 701, its first large computer based on the vacuum tube. The tubes were quicker, smaller, and more easily replaceable than the electromechanical switches in the Mark I. The 701 executed 17,000 instructions per second and was used primarily for government and research work. But vacuum tubes rapidly moved computers into business applications such as billing, payroll and inventory control.

In 1957, IBM introduced FORTRAN (FORmula TRANslation), a computer language based on algebra, grammar and syntax rules. It became the most widely used computer language for technical work.

By 1959, transistors were replacing vacuum tubes. The IBM 7090, one of the first fully transistorized mainframes, could perform 229,000 calculations per second. The Air Force used the 7090 to run its Ballistic Missile Early Warning System. In 1964, American Airlines' SABRE reservations system used two 7090 mainframes to link sales desks in 65 cities.

On April 7, 1964, IBM introduced the System/360, the first large "family" of computers to use interchangeable software and peripheral equipment. Rather than purchase a new system when the need and budget grew, customers now could simply upgrade parts of their hardware. It was a bold departure from the monolithic, one-size-fits-all mainframe. Fortune magazine dubbed it "IBM's $5 billion gamble."

During the 1970s the computer industry expanded and wove its way into everyday life. The floppy disk, introduced in 1971, became the standard for storing personal computer data. When people shopped for groceries, IBM's supermarket checkout station, introduced in 1973, used glass prisms, lenses and a laser to read product prices. Also in 1973, bank customers began making withdrawals, transfers and other account inquiries via the IBM 3614 Consumer Transaction Facility, an early form of today's Automatic Teller Machines.

The IBM PC

On August 12, 1981, IBM executives held a press conference in New York to introduce a momentous new computer- the IBM Personal Computer, or the PC, as it became known. This was the culmination of many events at IBM over the previous few years.

The IBM of 1980, much more than the IBM of today, was not a company accustomed to fast moving markets and customers sales.  It sold business machines- primarily computer and typewriters- to businesses, using its own technology and relying very heavily on a very structured system of sales and service to large accounts.

The PC business required something different.  This new market was moving quite fast, and a new entrant would have to move quickly. Apple, Tandy and Commodore had all produced ground-breaking machines during the previous two years. Any computer from IBM would need to target individuals as well as businesses, even if the ultimate aim was to continue to sell business computers.  This is what William C. Lowe, laboratory director of IBM's Entry Level Systems (ELS) unit in Boca Raton, Florida, told IBM's Corporate Management Committee, including IBM president John Opel, in July 1980.

Lowe told the committee that IBM needed to build a personal computer and that there was room in the market that Apple and others had left untapped.  But, he told the committee, it couldn't be built within IBM's standard culture of the time.  So they gave him the freedom to recruit 12 engineers to form a task force, called Project Chess, and to build a prototype computer. In the next month, Lowe's task force had a number of meetings with other players in the industry and made a number of key decisions that ultimately would affect the PC business for years to come.  One was the decision to sell IBM's personal computer through retails stores in addition to offering in through IBM's own commissioned sales staff.  But perhaps the company's most important decision was to use an "open architecture": to choose the basic components and operating system from sources outside of IBM.  It was a big departure for IBM, which up to this point typically had designed all the major components of its machines.

In August, Lowe and two engineers, Bill Sydnes and Lew Eggebrecht, demonstrated a prototype to the Corporation Management Committee, which approved the basic plan and give Project Chess the go-ahead to create a personal computer, code-named Acorn. To head the group that pulled it together, Lowe turned to Phillip D. "Don" Estridge, another longtime IBM employee, who worked at the Boca Raton labs. Estridge recruited a team that included Sydnes, who headed engineering, Dan Wilkie, who was in charge of manufacturing, and H.L. "Sparky" Sparks, who headed sales.

One early decision they had to make was to choose the processor to power the PC.  The task force had decided they wanted a 16- bit computer and easier to program than existing 8- bit machines.  Intel had recently announced the 16-bit 8086, but Sydnes later said that IBM was concerned that the 8086 would be too powerful and compete too much with other IBM entries. So instead they chose the 8088, a version of the chip that had an 8-bit bus and a 16- bit internal structure.  This 8-bit technology offered the added benefit of working with existing 8-bit expansion cards and with relatively in expensive 8-bit devices such as controller chips, which could thus be incorporated easily and inexpensively into the new machine.

Fevered months of putting together the hardware and software, including an Operating System from Microsoft, ensued.  Then, on Wednesday, August12, 1981, almost exactly a year after Project Chess was given the go- ahead, IBM introduced the IBM Personal Computer.  Sold initially at ComputerLand outlets and Sears Business Centers, that first PC- with an 8088 CPU, 64K of RAM, and a single- sided, 160K floppy disk drive- had a list price of $2,880.

When the IBM PC shipped in October, Estridge- by then considered the father of the PC- and his team had a run-away hit.

The Clones

The early 1980s saw dozens of very different designs, as one new company after another tried to define a unique combination of power, price, performance, and features.  Machines introduced in this period ranged from offering for home and hobbyist users- such as Commodore's Vic- 20 and 64, Atari's  400 series, and Texas Instruments' TI-99 - to more business- oriented devices, such as a series of machines from Tandy/ Radio Shack and host of designs that ran Digital Research's operating system CP/M, which was written by personal computing pioneer Gary Kildall.

Because the market was growing so fast, and because in those early days backward compatibility didn't mean much, the time was marked by a period of hardware creativity never since seen.  And of course, software began to grow as well, with the rapid appearance of a variety of early programming languages, games, and even business applications, such as the popular word processor Wordstar.

IBM licensed its PC standard in 1982, allowing other manbufacturers to produce PC-compatible machines or IBM clones. These were computers with parts built to the IBM specifications, alllowing increased standardisation across the industry and the easier interchanging and upgrading of systems.

Before long, nobody viewed personal computers as toys or hobbies but as devices for personal productivity with clear business applications.  The era of the personal computer was firmly established.

Decline

During the 1980s and early 1990s, IBM was thrown into turmoil by back-to-back revolutions. The PC revolution placed computers directly in the hands of millions of people. Businesses' purchasing decisions were put in the hands of individuals and departments - not the places where IBM had long-standing customer relationships. Piece-part technologies took precedence over integrated solutions. The focus was on the desktop and personal productivity, not on business applications across the enterprise. As a result IBM started to lose money for the first time ever.

However, with emphasis on Integrated Solutions and Network Technologies IBM began to fight back in the early 1990s. In 1995 they acquired Lotus Development Corporation (the producers of Lotus 1-2-3), and the next year acquired Tivoli Systems Inc.

In May 1997, IBM dramatically demonstrated computing's potential with Deep Blue, a 32-node IBM RS/6000 SP computer programmed to play chess on a world class level. In a six-game match in New York, Deep Blue defeated World Chess Champion Garry Kasparov. It was the first time a computer had beaten a top-ranked chess player in tournament play, and it ignited a public debate on how close computers could come to approximating human intelligence. The scientists behind Deep Blue, however, preferred to stress more practical concerns. Deep Blue's calculating power -- it could assess 200 million chess moves per second -- had a wide range of applications in fields calling for the systematic exploration of a vast number of variables, among them forecasting weather, modeling financial data and developing new drug therapies.