IBM PC

By 1981, a small but vigorous personal computer (PC) industry was offering complete desktop computer systems. Apple’s Apple II offered color graphics and expandability through an “open architecture”—slots into which cards designed by third-party vendors could be plugged. While the Apple II had its own DOS (disk operating system) as did Radio Shack’s TRS-80, most microcomputers sold in the business market used CP/M, an operating system developed by Gary Kildall and his company Digital Research.

Meanwhile, IBM, the world’s largest computer com-pany (see ibm), had quietly created a special team headed by Phillip (“Don”) Estridge and tasked with designing a personal computer. Unlike the case with the company’s mainframe development, the team was given considerable freedom in choosing architecture and components—but they were told they would have to have a machine ready for the market in one year.

Because of the short time frame, the team chose third-party components already well established in the market, including the monitor, floppy disk drive, and a printer. Unlike Apple and most other companies, IBM created two separate video display systems, one monochrome (MDA) for sharp text for business applications and the three-color CGA system for the game and education markets (see graphics card).

The IBM team also adopted standards from the emerg-ing microcomputer industry instead of trying to use exist-ing mainframe standards. For example, they used the ASCII code to represent characters, not the EBCDIC code used on IBM mainframes. They also chose the Intel 8086 and 8088 microprocessors, which had an instruction set simi-lar to that of the Intel 8080 used in many CP/M systems (see microprocessor). This would make it easy for soft-ware developers to create IBM PC versions of their software quickly so that the new machine would have a repertoire of business software.

One might have expected that IBM would also adopt a version of CP/M as the PC’s operating system, taking advantage of the closest thing to an existing industry standard. However, CP/M was relatively expensive, and negotiations with Digital Research stumbled, leaving an opening for a much smaller company, Microsoft, to sell a DOS based on software it had licensed from Seattle Computer Products. While IBM did offer CP/M and another operating system based on the UC San Diego Pascal development system, Microsoft DOS, which became known as PC-DOS (and later MS-DOS), was cheapest and effectively became the default offering (see ms-dos).

When IBM officially announced its PC in April 1981, Apple took out full-page ads “welcoming” the new com-petitor to what it considered to already be a mature indus-try. But by the end of 1983, a million IBM PCs had been sold, dwarfing Apple and other brands. From then on, while Apple would go on to announce its distinctive Macintosh in 1984, the IBM machine would set the industry standard. To most people, “PC” would mean “IBM PC.”

Open Standards and Expansion

As more businesses bought IBM PCs, the company steadily expanded the machine’s capabilities to meet the demands of the business environment. The next model, the PC-XT, introduced in 1982, included a hard disk drive and more system memory. As software became more demanding, the need for a faster and more capable processor also became apparent. In 1984, IBM responded with the PC-AT, which used the Intel 80286 processor, combining the faster pro-cessor with a wider (16-bit) and faster data bus (see bus).

However, IBM would not have the market to itself. A consequence of the use of an open, expandable architecture and “off the shelf” processor and other components is that other companies could market PCs that were compatible with IBM’s (that is, they could run the same operating sys-tem and applications software). Although competitors could not legally make a simple copy of the read-only memory (ROM) BIOS, the code that enabled the components to com-municate, they could reverse-engineer a functional equiva-lent. The first major competitor in what became known as the “PC Clone” market was Compaq, which also offered an improved video display and a transportable model. Zenith, Tandy (Radio Shack), and HP also offered “name-brand” PC clones.

In 1987, IBM tried to establish a proprietary standard by introducing the PS/2 line, which featured a 3.5-inch floppy drive (standard PC compatibles used 5.25-inch drives), a new high-resolution graphics standard (VGA), a new sys-tem bus (MCA or Microchannel Architecture), and a new operating system (OS/2). Despite some technical advan-tages, the PS/2 achieved only modest success. Since the card slots were incompatible with the previous standard, existing expansion products could not be used. Microsoft soon came out with a new operating environment, Win-dows, which while inferior in multitasking capabilities to OS/2 was easier to use (see user interface and Microsoft Windows).

By the 1990s, it was clear that IBM no longer controlled the standards for PCs. (Indeed, IBM soon abandoned the PS/2 MCA architecture and returned to the earlier standard, which competitors had never left.) Instead, the indus-try incrementally built upon what had become known as the ISA (Industry Standard Architecture), supplementing it with a new kind of expansion card connector called PCI. Currently, IBM is in the second tier in PC sales behind industry leaders Dell and Compaq, having a market share comparable to Hewlett-Packard and Gateway. IBM also did relatively well in the laptop computer sector with its Think-pad series, before selling it to Lenovo.

Today’s industry standards are effectively determined by two companies: the chip-maker Intel and the software giant Microsoft. Indeed, “standard” PCs are now often called “Wintel” machines. The direct-order giant Dell and its competitors HP and Lenovo dominate the “commodity PC” market. However, by creating a standard that was flex-ible enough for two decades of PC development, IBM made a lasting contribution to computing comparable to its inno-vations in the mainframe arena.