How the IBM PC Won, Then Lost, the Personal Computer Market
On 12 August 1981, at the Waldorf Astoria Hotel in midtown Manhattan, IBM unveiled the company's entrant into the nascent personal computer market: the IBM PC. With that, the preeminent U.S. computer maker launched another revolution in computing, though few realized it at the time. What occurred between IBM's wildly successful entry into the personal computer business and its inglorious exit nearly a quarter century later? From IBM's perspective, a new and vast market quickly turned into an ugly battleground with many rivals. IBM's large commercial customers faced the implications of this emerging technology: Who would maintain the equipment and its software? How secure was the data in these machines? And what was IBM's position: Should personal computers be taken seriously or not? By 1980, customers in many industries were telling their IBM contacts to enter the fray. The normal process to get a new IBM product to market took four or five years, but the incipient PC market was moving too quickly for that. While IBM continued to sell millions of personal computers, over time the profit on its PC business declined. The end of the IBM PC. IBM soldiered on with the PC until Samuel J. Palmisano, who once worked in the PC organization, became CEO in 2002. As the New York Times explained, the sale "Signals a recognition by IBM, the prototypical American multinational, that its own future lies even further up the economic ladder, in technology services and consulting, in software and in the larger computers that power corporate networks and the Internet. All are businesses far more profitable for IBM than its personal computer unit."