Happy 25th, IBM PC

Kai Ryssdal Aug 11, 2006


KAI RYSSDAL: Let me read you something. It’s a press release from IBM, dated August 12, 1981: “IBM Corporation today announced its smallest, lowest priced computer system. The IBM Personal Computer.” The IBM Model 5150 retailed for about $1,500 dollars back then. It weighed about 25 pounds, and it’s not too much of a stretch to say it changed the world. We called technology writer Robert X. Cringely to explain how. Bob, thanks for joining us.

ROBERT X. CRINGELY: Thanks Kai, glad to be here.

RYSSDAL: Let’s be honest and admit right up front here that we’re not really talking about the actual birth of the PC here, but rather the birth of an industry right?

CRINGELY: Sure the birth of the IBM PC marks the date at which personal computers became acceptable by big business in the United States.

RYSSDAL: What’s so special about that happening from IBM though?

CRINGELY: Well it had to happen from IBM because it hadn’t particularly happened from any of the other players like the original PC the MITS Altair 8800 or even the Apple II. You know I was an early Apple employee and we sold an awful lot of Apple IIs into business, but business often didn’t realize that we’d done so. I remember there was a meeting in Pittsburgh once with Westinghouse Electric Company where the head computer guy there said that he would never ever buy a microcomputer as long as he was working at the company. And then we pulled out the registration documents to show that there were 1,000 Apple IIs running in the very building we were sitting in. So . . .

RYSSDAL: Funnily enough though, 25 years on, IBM’s not even in the business anymore. They sold it to Lenovo last year.

CRINGELY: Yeah IBM had a hard time making money from the personal computer and this is for a couple different reasons. One is because of the Consent Decree of 1956 that they felt that they were under it, they interpreted it at the time as not allowing them to control the operating system software which Microsoft did. The other thing was that they created an environment in which it was very easy for their own dealers to undermine the business of IBM by selling what were called grey-market copies of the product out the back door. IBM would offer huge discounts to dealers who would order a lot, and so they would order as many as they could get. But the ones they couldn’t sell, they would sell out the back door to other dealers, non-authorized dealers, who would promise to go to some other state and sell them. And what it did was it drove down the price and it enabled early grey-market dealers like Michael Dell to get in business.

RYSSDAL: What was it about that IBM on the PC that made it so special for other companies?

CRINGELY: Well it wasn’t the computer. The computer itself was pretty uninspiring. But the fact that IBM was selling it, suddenly big companies that had previously ignored microcomputers except of course they were using them secretly running spreadsheets but they couldn’t authorize, they were buying them out of petty cash. Up to that point they couldn’t buy it out of their official computing budget but IBM made that possible.

RYSSDAL: You know it seems these days a PC is a PC is a PC is a PC and what makes it really special and able to do all kinds of different things is what you put on there, the software.

CRINGELY: Well that’s right, I mean ultimately it’s the application, it’s that killer app that counts and originally the first one for the IBM PB was really Lotus 1-2-3. And that spreadsheet program powered America for at least a decade.

RYSSDAL: There are so many little gizmos now, from Blackberries and Treos to digital cameras that you plug right into a printer, you just sidestep the whole computer thing. I’m wondering whether you think maybe PCs are sort of on the way out?

CRINGELY: Well it’s popular to say so, but I think what we’ve done is we’ve put computers on every desktop in America and created a niche market there that’s going to continue to exist. We’ll certainly be moving a lot of our capability to mobile devices, you know, you mentioned the Blackberries and mobile phones in fact, but the desktop personal computer is I don’t think going away.

RYSSDAL: Robert X. Cringely is a columnist for PBS.org. He hosts NerdTV on PBS.org as well. Thanks Bob.

CRINGELY: Thanks a lot Kai.

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