International Business Machines Corporation, doing business as IBM (nicknamed Big Blue), is an American multinational technology company headquartered in Armonk, New York, and present in over 175 countries. It is a publicly traded company and one of the 30 companies in the Dow Jones Industrial Average. IBM is the largest industrial research organization in the world, with 19 research facilities across a dozen countries; for 29 consecutive years, from 1993 to 2021, it held the record for most annual U.S. patents generated by a business.
IBM was founded in 1911 as the Computing-Tabulating-Recording Company (CTR), a holding company of manufacturers of record-keeping and measuring systems. It was renamed "International Business Machines" in 1924 and soon became the leading manufacturer of punch-card tabulating systems. During the 1960s and 1970s, the IBM mainframe, exemplified by the System/360 and its successors, was the world's dominant computing platform, with the company producing 80 percent of computers in the U.S. and 70 percent of computers worldwide. Embracing both business and scientific computing, System/360 was the first family of computers designed to cover a complete range of applications from small to large.
IBM entered the microcomputer market in 1981 with the IBM Personal Computer; its architecture remains the basis for the majority of personal computers sold today. The company later also found success in the laptop space with the ThinkPad. Since the 1990s, IBM has concentrated on computer services, software, supercomputers, and scientific research; it sold its microcomputer division to Lenovo in 2005. IBM continues to develop mainframes, and its supercomputers have consistently ranked among the most powerful in the world in the 21st century.
As one of the world's oldest and largest technology companies, IBM has been responsible for several technological innovations, including the Automated Teller Machine (ATM), Dynamic Random-Access Memory (DRAM), the floppy disk, Generalized Markup Language, the hard disk drive, the magnetic stripe card, the relational database, the SQL programming language, and the Universal Product Code (UPC) barcode. The company has made inroads in advanced computer chips, quantum computing, artificial intelligence, and data infrastructure. IBM employees and alumni have won various recognitions for their scientific research and inventions, including six Nobel Prizes and six Turing Awards.
History
1910s–1950s IBM originated with several technological innovations developed and commercialized in the late 19th century. Julius E. Pitrap patented the computing scale in 1894; Alexander Dey invented the dial recorder (1888); Herman Hollerith patented the Electric Tabulating Machine (1889); and Willard Bundy invented a time clock to record workers' arrival and departure times on a paper tape (1889). On June 16, 1911, their four companies were amalgamated in New York State by Charles Ranlett Flint forming a fifth company, the Computing-Tabulating-Recording Company (CTR) based in Endicott, New York. The five companies had 1,300 employees and offices and plants in Endicott and Binghamton, New York; Dayton, Ohio; Detroit, Michigan; Washington, D.C.; and Toronto, Canada.
Collectively, the companies manufactured a wide array of machinery for sale and lease, ranging from commercial scales and industrial time recorders, meat and cheese slicers, to tabulators and punched cards. Thomas J. Watson, Sr., fired from the National Cash Register Company (NCR) by John Henry Patterson, called on Flint and, in 1914, was offered a position at CTR. Watson joined CTR as general manager and then, 11 months later, was made President when antitrust cases relating to his time at NCR were resolved. Having learned Patterson's pioneering business practices, Watson proceeded to put the stamp of NCR onto CTR's companies. He implemented sales conventions, "generous sales incentives, a focus on customer service, an insistence on well-groomed, dark-suited salesmen and had an evangelical fervor for instilling company pride and loyalty in every worker". His favorite slogan, "THINK", became a mantra for each company's employees. During Watson's first four years, revenues reached $9 million ($ today) and the company's operations expanded to Europe, South America, Asia and Australia. Watson never liked the clumsy hyphenated name "Computing-Tabulating-Recording Company" and chose to replace it with the more expansive title "International Business Machines" which had previously been used as the name of CTR's Canadian Division;Belden (1962) p. 125 the name was changed on February 14, 1924. By 1933, most of the subsidiaries had been merged into one company, IBM.(Rodgers, THINK, p. 83)
World War II
The Nazis made extensive use of Hollerith punch card and alphabetical accounting equipment and IBM's majority-owned German subsidiary, Deutsche Hollerith Maschinen GmbH (Dehomag), supplied this equipment from the early 1930s. This equipment was critical to Nazi efforts to categorize citizens of both Germany and other nations that fell under Nazi control through ongoing censuses. These census data were used to facilitate the round-up of Jews and other targeted groups, and to catalog their movements through the machinery of the Holocaust, including internment in the concentration camps. Edwin Black contends in IBM and the Holocaust that IBM's dealings with Nazis through its New York City headquarters persisted during World War II. Nazi concentration camps operated a Hollerith department called Hollerith Abteilung, which had IBM machines, including calculating and sorting machines.
In 1944, IBM completed the Automatic Sequence Controlled Calculator, a programmable electromechanical computer that aided in US and Allied weapons research and development applications, including for the Manhattan Project. As a military contractor, IBM also produced 346,500 M1 carbines, or about 6% of all units manufactured during World War II.
1950s–1980s IBM offered its first commercial stored-program computer, the vacuum tube based IBM 701, in 1952. The IBM 305 RAMAC introduced the hard disk drive in 1956. The company switched to transistorized designs with the 7000 and 1400 series, beginning in 1958. The 1400 series was the first to deploy over 10000 units, making it its most successful computer device at the time.
In 1956, the company demonstrated the first practical example of artificial intelligence when Arthur L. Samuel of IBM's Poughkeepsie, New York, laboratory programmed an IBM 704 not merely to play checkers but "learn" from its own experience. In 1957, the FORTRAN scientific programming language was announced.
In 1961, IBM developed the SABRE reservation system for American Airlines and introduced the highly successful Selectric typewriter. Also in 1961, IBM used the IBM 7094 to generate the first song sung completely by a computer using synthesizers. The song was Daisy Bell (Bicycle Built for Two). The recording is now in the United States National Recording Registry.
In 1963, IBM employees and computers helped NASA track the orbital flights of the Mercury astronauts. A year later, it moved its corporate headquarters from New York City to Armonk, New York. The latter half of the 1960s saw IBM continue its support of space exploration, participating in the 1965 Gemini flights, 1966 Saturn flights, and 1969 lunar mission. IBM also developed and manufactured the Saturn V's Instrument Unit and Apollo spacecraft guidance computers.
On April 7, 1964, IBM launched the first computer system family, the IBM System/360. It spanned the complete range of commercial and scientific applications from large to small, allowing companies for the first time to upgrade to models with greater computing capability without having to rewrite their applications. It was followed by the IBM System/370 in 1970. Together the 360 and 370 made the IBM mainframe the dominant mainframe computer and the dominant computing platform in the industry throughout this period and into the early 1980s. They and the operating systems that ran on them such as OS/VS1 and MVS, and the middleware built on top of those such as the CICS transaction processing monitor, had a near-monopoly-level market share and became the thing IBM was most known for during this period.
In 1969, the United States of America alleged that IBM violated the Sherman Antitrust Act by monopolizing or attempting to monopolize the general-purpose electronic digital computer system market, specifically computers designed primarily for business, and subsequently alleged that IBM violated the antitrust laws in IBM's actions directed against leasing companies and plug-compatible peripheral manufacturers. Shortly after, IBM unbundled its software and services in what many observers believed was a direct result of the lawsuit, creating a competitive market for software. In 1982, the Department of Justice dropped the case as "without merit".
Also in 1969, IBM engineer Forrest Parry invented the magnetic stripe card that would become ubiquitous for credit/debit/ATM cards, driver's licenses, rapid transit cards and a multitude of other identity and access control applications. IBM pioneered the manufacture of these cards, and for most of the 1970s, the data processing systems and software for such applications ran exclusively on IBM computers. In 1974, IBM engineer George J. Laurer developed the Universal Product Code. IBM and the World Bank first introduced financial swaps to the public in 1981, when it entered into a swap agreement.
In the early 1970s, the Examination Department of the South Vietnamese Ministry of Education contracted with IBM to computerize all examination records, from registration and application forms to certificates of admission and necessary statistical data. By 1974, all subjects in the South Vietnamese high school graduation exam were converted to multiple-choice questions. Answer sheets for the multiple-choice exams were ordered from the United States, and candidates' papers were graded using an IBM 1230 machine. The graded papers were then transferred to an IBM 534 machine for punching. These punched sheets were then fed into an IBM 360 machine to read the scores, multiply by coefficients, add up the scores, calculate the average score, standard deviation, convert raw scores to standardized scores, and calculate the admission ranking. The sample group and norm group were carefully selected according to statistical methods to calculate the average score and standard deviation.Nguyễn Thanh Liêm (2006). Education in South Vietnam before 1975. California: Lê Văn Duyệt Foundation. pp 38–44.
IBM entered the microcomputer market in the 1980s with the IBM Personal Computer (IBM 5150). The computer, which spawned a long line of successors, had a profound influence on the development of the personal computer market and became one of IBM's best selling products of all time. The PC was not well protected by intellectual property laws. As a consequence, IBM quickly began losing its market dominance to emerging, compatible competitors in the PC market. Experts debate whether this was an early example of successful adoption of open architecture, or a lack of business foresight by IBM.
In 1985, IBM collaborated with Microsoft to develop a new operating system, which was released as OS/2. Following a dispute, Microsoft severed the collaboration and IBM continued development of OS/2 on its own but it failed in the marketplace against Microsoft's Windows during the mid-1990s.
1990s–2000s