IBM Prepares to Leave an Industry It Created

Although IBM can be credited with defining an industry it kicked off by launching the first IBM PC in 1981, the company eventually lost control-and enterprise confidence-in the space that it never quite regained.

In August 1981, the world of computing changed. When IBM launched its first IBM PC, most observers at the time simply thought it was a good move by a company that was already a leader. The new computer would help IBM stay relevant and provide a new class of computers that would add some revenue. But it turned out to be much more than that.

The arrival of the IBM PC legitimized what until then had been the realm of hobbyists and experimenters. While there were some business uses for a few of the personal computers at the time, and while there was some interest in Apple Computers offerings in education, PCs had very little impact on business. Until 1981.

Then, with the IBM logo showing up on desktop computers, business paid attention. But so did a lot of small companies just entering the electronics business.

"IBMs decision to publish in the open literature the design and specifications of its PC created a new ecosystem," said Dag Spicer, senior curator of the Computer History Museum in Mountain View, Calif.

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While the idea of an open standard wasnt new to computing—the S100 bus was an attempt at the same end and had been out for a couple of years by the time IBM shipped the PC—it was a first for IBM. "Theyd been a proprietary company before that," Spicer said.

But the move to the open standard resulted in the rapid growth of an industry. Companies created add-on cards, peripherals, accessories and, of course, computers. The open standard did more than make hardware add-ons possible; it created a software industry as well. Within months of the first IBM PC shipment, the concept of being "IBM PC compatible" had already entered the literature.

But the source of the standard was as important as the fact that it existed at all. "Ten or 15 years ago, the fact that a technology came from IBM was considered to be an important endorsement," said Alan Zeichick, principal analyst at Camden Associates in San Bruno, Calif. Spicer agreed, calling IBM "the Vatican of computing."

With the arrival of new manufacturers came new products, and of course a new industry. Microsoft, picked by the original Skunk Works team in Boca Raton for the initial operating system, went from being a tiny maker of tape-based BASIC interpreters to the largest software company on the planet.

Next Page: Some competitors couldnt adapt.

Wayne Rash

Wayne Rash

Wayne Rash is a freelance writer and editor with a 35 year history covering technology. He’s a frequent speaker on business, technology issues and enterprise computing. He covers Washington and...