The history of IBM

A history of the Armonk, N.Y.-based International Business Machines Corporation, known popularly as IBM.

From tabulating machines to e-business servers

A photo taken in 2008 of an IBM office in New York. ((Mark Lennihan/Associated Press))

Computer giant IBM has its roots in the late 1880s in companies that sold such varied products as scales, time recorders and meat slicers.

But today "Big Blue," so called for its official colour, is now a multinational computer technology company.

Here's a timeline of the company's lengthy history.



IBM's predecessor, Computing-Tabulating-Recording Company (CTR), is incorporated in New York state. It is the result of a merger of three companies. It now sells machinery ranging from commercial scales and industrial time recorders to meat and cheese slicers, plus tabulators and punched cards.


CTR begins to focus on large-scale tabulating solutions for businesses and drops small office products.


CTR's name is changed to International Business Machines Corp. By now, it has expanded to three manufacturing facilities in Europe.


IBM manages to grow during the Great Depression.


It adds a new product unit, the electric writing machine division.


IBM gets government contract to maintain employment records for 26 million people under the Social Security Act. It's called the "biggest accounting operation of all time."


All IBM facilities are at the disposal of the U.S. government while the Second World war is underway. Products expand into bombsights, rifles and engine parts. During the war years, IBM makes its first steps into computing.


The Automatic Sequence Controlled Calculator, also called the Mark I, is completed in 1944. It's the first machine that can execute long computations automatically. It was over 15 metres long, 2.5 metres high and weighed more than 4.5 tonnes, but took less than a second to solve an addition problem and six seconds for multiplication.


IBM introduces the Selective Sequence Electronic Calculator as the company's first large-scale digital calculating machine.


IBM introduces the IBM 701, the first large computer based on the vacuum tube (which would later be replaced by transistors). It executed 17,000 instructions per second and was used primarily for government and research work. It brought computers into business applications such as billing, payroll and inventory control.


IBM introduces the IBM 305 RAMAC, the first computer disk storage system. Such machines became the industry's storage medium for transaction processing. IBM introduces FORTRAN (FORmula TRANSlation), a computer language based on algebra, grammar and syntax rules that becomes the most widely used computer language for technical work.


IBM 7090, one of the first fully transistorized mainframes, could perform 229,000 calculations per second. The U.S. Air Force used it to run its Ballistic Missile Early Warning System.


After nearly 40 years as IBM's chief executive, Thomas J. Watson Sr., dies. He leaves the job to his son, Thomas J. Watson Jr.


The new CEO leads IBM's transformation from maker of tabulating equipment and typewriters into the computer industry.


IBM introduces System/360, the first large "family" of computers to use interchangeable software and peripheral equipment. It's the first move away from monolithic, one-size-fits-all mainframe. Fortune magazine dubs it "IBM's $5-billion gamble."


IBM stops bundling hardware, services and software in packages and sells individually. This so-called "unbundling" gives birth to multibillion-dollar software and services industries.


Watson family leadership ends. Frank T. Cary takes over in 1973.


Floppy disk introduced and later becomes standard for storing personal computer data.


IBM makes a supermarket checkout station using glass prisms, lenses and a laser to read product prices.


Bank customers making withdrawals, transfers and other account inquiries are using IBM 3614 Consumer Transaction Facility, an early form of today's ATMs.


IBM announces the IBM Personal Computer, with a starting price of $1,565, 16 kilobytes of user memory and optional colour monitor. The processor chip came from Intel and the operating system, called DOS (Disk Operating System), was from Microsoft, then a 32-person company.


The company introduces a token-ring local area network, allowing personal computer users to exchange information and share printers and files within a building or complex.

1980s and 1990s

Revolutions put computers in the homes of millions of people and create a need for larger computers (servers) labouring in the background to link and serve them all. Focus changed to individuals from business productivity.

IBM suffered and by 1993, company's annual net losses reached record $8 billion because it was more focused on business clients than personal computer use.


Despite pressures to split IBM up, the CEO decides to keep it together and start focusing on client/server field. IBM focuses on e-business revolution and sees turnaround in fortunes.


It acquires Lotus Development Corp., whose pioneering Notes software enables greater collaboration across an enterprise. The acquisition makes IBM the world's largest software company.


IBM acquires Tivoli Systems Inc., leading provider of systems management software and services for distributed client/server networks of personal computers and workstations.


It becomes the first major company to introduce a network computer, a new kind of desktop device that provides access to networked applications and processing power.


IBM introduces Deep Blue, a 32-node IBM RS/6000 SP computer programmed to play chess on world-class level. The computer defeats world chess champion Garry Kasparov, the first time a computer had beaten a top-ranked chess player in a tournament game. It ignites debate on how close computers can come to human intelligence. The computer can assess 200 million chess moves per second.


Consumer demand falls due to Y2K and the collapse of dot-coms.


IBM buys the consulting unit of accounting and consulting firm PricewaterhouseCoopers. It's seen as a key step in IBM transforming itself from a hardware and software company to one focused on consulting and services.