A large company enters a young market
By the end of the 1970s, small computers from several manufacturers were selling to hobbyists, schools and small businesses. IBM, then best known for large systems used by corporations and governments, was not a major presence in that market. Its response, announced in August 1981, was the IBM Personal Computer, usually shortened to the IBM PC.
The name mattered. Many business buyers were cautious about unfamiliar small companies, and IBM’s reputation gave them a reason to consider a desktop machine seriously. The arrival of such a large firm told the wider market that small computers were becoming a normal part of office equipment, not just a hobby.
A design built from existing parts
Accounts of the project often describe it as an unusual one for IBM. Instead of designing every component in-house, as the company typically did for its large systems, the team building the PC relied heavily on parts and software from outside suppliers. The processor was a chip from Intel, the 8088, a member of the family that grew out of the microprocessors of the 1970s. The operating software came from Microsoft, and IBM sold it under its own name as PC-DOS, while Microsoft was free to license a closely related version, MS-DOS, to others.
The team also worked from a relatively small, separate group so that decisions could be made faster than usual. These choices sped up development, and they also set the stage for what followed, since a machine assembled from commonly available components was easier for others to imitate.
An open approach
The PC included expansion slots inside the case, so owners could add cards for extra memory, displays, printers and other equipment. IBM published technical information about the machine, which encouraged other companies to build add-on hardware and write software for it. The result was a growing collection of products, from accessories to programs, that made the machine more useful and gave buyers more reasons to choose it.
“Open” here has a specific meaning. The design was documented and extensible, but it was not free of ownership: IBM held rights to key parts of the system, notably its built-in startup software, called the BIOS. That distinction became important very soon.
Software that drew buyers in
A computer is only as useful as the programs available for it. Spreadsheets, word processors and database tools appeared for the IBM PC in large numbers, and business users found that these tools replaced tasks once done on paper or on a shared system. As more software was written for the machine, more buyers saw it as the safe choice, and more developers wrote for it in turn. This self-reinforcing loop is a common pattern in the history of computing platforms, and it helps explain why one design can dominate a market even if other machines are admired for their features.
The wider changes in how companies worked with desktop machines are explored in the discussion of business computing and office automation, which place the IBM PC in the shift from typewriters and shared terminals to individual workstations.
Compatibles and clones
If a rival company could build a machine that ran the same software, it could sell into the same market. The sticking point was the BIOS, which IBM owned. Some early attempts to copy the machine ran into legal trouble. Companies then turned to a careful method, often described as clean-room engineering, in which one group studied what the BIOS did and wrote a specification, and a separate group wrote new code from that specification without seeing IBM’s own. Several firms used this approach to produce compatible startup software that avoided infringing IBM’s.
One of the best-known early compatible makers was Compaq, whose portable computer, released in the early 1980s, ran the same software as the IBM PC. Many other companies followed, and the word “clone” became common. Buyers could now choose among many makers offering machines that ran the same programs, often at lower prices, and competition tended to push prices down over time.
IBM loses control of its own standard
The same openness that helped the PC succeed also meant IBM could not easily keep the market to itself. In the second half of the 1980s IBM introduced a new line of machines, the PS/2, which included a different expansion design intended to be more proprietary. Many in the industry kept building around the older arrangement, and the compatible market continued to grow. The details are disputed and the full story is more complicated than a simple defeat, but it is generally accepted that the center of gravity in the market moved away from IBM and toward the makers of processors and operating software, particularly Intel and Microsoft.
Legacy
The long-term effects are visible in several ways.
- The phrase “PC” became a general term for a desktop computer of this family, distinct from rivals such as Apple’s Macintosh line.
- The idea of a modular computer, in which cards, drives and software from many suppliers work together, became familiar to buyers and manufacturers alike.
- Compatibility with older software became a major selling point, which has sometimes slowed change as well as protecting users’ investments.
- Today’s laptop computers and desktops running Windows or Linux descend, through many generations of change, from the compatible market that grew around the 1981 machine, though almost nothing inside them is the same.
None of this means the IBM PC was the first personal computer or the best one. Machines from other companies came earlier and offered features it lacked. Its importance lay in timing, reputation and a flexible design that others could build upon. Together with the rise of the graphical user interface and the spread of cheaper hardware in the following decade, it helped shape what most people think of as an ordinary computer.