Personal computer

The invention: Originally a tradename of the IBM Corporation,
“personal computer” has become a generic term for increasingly
powerful desktop computing systems using microprocessors.
The people behind the invention:
Tom J. Watson, (1874-1956), the founder of IBM, who set
corporate philosophy and marketing principles
Frank Cary (1920- ), the chief executive officer of IBM at the
time of the decision to market a personal computer
John Opel (1925- ), a member of the Corporate Management
Committee
George Belzel, a member of the Corporate Management
Committee
Paul Rizzo, a member of the Corporate Management Committee
Dean McKay (1921- ), a member of the Corporate
Management Committee
William L. Sydnes, the leader of the original twelve-member
design team
Shaking up the System
For many years, the International Business Machines (IBM) Corporation
had been set in its ways, sticking to traditions established
by its founder, Tom Watson, Sr. If it hoped to enter the new microcomputer
market, however, it was clear that only nontraditional
methods would be useful. Apple Computer was already beginning
to make inroads into large IBM accounts, and IBM stock was starting
to stagnate onWall Street. A1979 BusinessWeek article asked: “Is
IBM just another stodgy, mature company?” The microcomputer
market was expected to grow more than 40 percent in the early
1980’s, but IBM would have to make some changes in order to bring
a competitive personal computer (PC) to the market.
The decision to build and market the PC was made by the company’s
Corporate Management Committee (CMC). CMC members
included chief executive officer Frank Cary, John Opel, George Belzel, Paul Rizzo, Dean McKay, and three senior vice presidents. In
July of 1980, Cary gave the order to proceed. He wanted the PC to be
designed and built within a year. The CMC approved the initial design
of the PC one month later. Twelve engineers, with William L.
Sydnes as their leader, were appointed as the design team. At the
end of 1980, the team had grown to 150.
Most parts of the PC had to be produced outside IBM. Microsoft
Corporation won the contract to produce the PC’s disk operating system
(DOS) and the BASIC (Beginner’s All-purpose Symbolic Instruction
Code) language that is built into the PC’s read-only memory
(ROM). Intel Corporation was chosen to make the PC’s central processing
unit (CPU) chip, the “brains” of the machine. Outside programmers
wrote software for the PC. Ten years earlier, this strategy
would have been unheard of within IBM since all aspects of manufacturing,
service, and repair were traditionally taken care of in-house.
Marketing the System
IBM hired a New York firm to design a media campaign for the
new PC. Readers of magazines and newspapers saw the character
of Charlie Chaplin advertising the new PC. The machine was delivered
on schedule on August 12, 1981. The price of the basic “system
unit” was $1,565. A system with 64 kilobytes of random access
memory (RAM), a 13-centimeter single-sided disk drive holding
160 kilobytes, and a monitor was priced at about $3,000. A system
with color graphics, a second disk drive, and a dot matrix printer
cost about $4,500.
Many useful computer programs had been adapted to the PC
and were available when it was introduced. VisiCalc from Personal
Software—the program that is credited with “making” the microcomputer
revolution—was one of the first available. Other packages
included a comprehensive accounting system by Peachtree
Software and a word processing package called Easywriter by Information
Unlimited Software.
As the selection of software grew, so did sales. In the first year after
its introduction, the IBM PC went from a zero market share to 28
percent of the market. Yet the credit for the success of the PC does
not go to IBM alone. Many hundreds of companies were able to produce software and hardware for the PC.Within two years, powerful
products such as Lotus Corporation’s 1-2-3 business spreadsheet
had come to the market. Many believed that Lotus 1-2-3 was the
program that caused the PC to become so phenomenally successful.
Other companies produced hardware features (expansion boards)
that increased the PC’s memory storage or enabled the machine to
“drive” audiovisual presentations such as slide shows. Business especially
found the PC to be a powerful tool. The PC has survived because
of its expansion capability.
IBM has continued to upgrade the PC. In 1983, the PC/XT was
introduced. It had more expansion slots and a fixed disk offering 10
million bytes of storage for programs and data. Many of the companies
that made expansion boards found themselves able to make
whole PCs. An entire range of PC-compatible systems was introduced
to the market, many offering features that IBM did not include
in the original PC. The original PC has become a whole family
of computers, sold by both IBM and other companies. The hardware
and software continue to evolve; each generation offers more computing
power and storage with a lower price tag.
Consequences
IBM’s entry into the microcomputer market gave microcomputers
credibility. Apple Computer’s earlier introduction of its computer
did not win wide acceptance with the corporate world. Apple
did, however, thrive within the educational marketplace. IBM’s
name already carried with it much clout, because IBM was a successful
company. Apple Computer represented all that was great
about the “new” microcomputer, but the IBM PC benefited from
IBM’s image of stability and success.
IBM coined the term personal computer and its acronym PC. The
acronym PC is now used almost universally to refer to the microcomputer.
It also had great significance with users who had previously
used a large mainframe computer that had to be shared with
the whole company. This was their personal computer. That was important
to many PC buyers, since the company mainframe was perceived
as being complicated and slow. The PC owner now had complete
control.