Chapter 10 Section 3 misses the tide of global informatization

If the history of the computer industry is to be divided into stages, then 1976 can be used as a watershed.This year, the genius Steve Jobs (Steve Jobs), who did not finish college, built the world's first commercially available personal computer, the Apple-I, in the garage.Many companies in Silicon Valley often rent cheap private houses or even their garages to work because of limited funds when they start their businesses. This is almost a unique phenomenon in Silicon Valley, and Apple was no exception when it started. "Big Blue" is not slow to start in this wave of information revolution. Frank Cary, IBM's new president who took over from Watson in 1973, spent much of his time dealing with antitrust lawsuits filed by the U.S. Department of Justice while keeping a close eye on the development of new technologies.For personal computers, IBM waited and watched for several years.This is very necessary for a large company like IBM.As we have said before, the secret of IBM's success is conservatism.If Apple fails, IBM doesn't need to do anything.If the former succeeds, IBM can completely strike back with its strong technical reserves.As we mentioned earlier, IBM is actually the second computer company.We will see many examples of large companies using this method against small companies in the future.Four years later, Kelly decided to develop a personal computer.

Maybe it didn't want to attract attention, maybe it didn't pay too much attention to this matter, IBM didn't let its most powerful Watson Labs (T J Watson Labs) do this, but handed it over to IBM in A group of a dozen in Florida.In order to develop a PC as quickly as possible, this group of only a dozen people had to break the previous habit of developing all the software and hardware of the computer by itself, and adopted Intel's 8088 chip as the processor of the computer, and at the same time entrusted an independent software company to provide software for it. Configure various software.In this way, IBM-PC came out in only one year.Although the performance of the first batch of IBM-PCs was only one ten-thousandth of that of current personal computers, it was much better than Apple's Apple series, and it was sufficient for word processing, programming and other applications at that time.Therefore, it was very popular and sold 100,000 units that year, occupying three-quarters of the microcomputer market. IBM is really a latecomer in the competition with Apple.To this day, the IBM PC is synonymous with personal computers.

If you asked everyone who would be the leader of the personal computer era in the future, nine out of ten people would answer IBM.In fact, Time Magazine voted the IBM PC the greatest product of the twentieth century. The Wall Street Journal also spoke highly of IBM's contribution.However, we now know that the ultimate leaders of the personal computer era are Microsoft and Intel, not IBM.With the sale of IBM's personal computer division to China's Lenovo in 2005, IBM completely withdrew from the personal computer arena. What is the reason for this result of IBM?Although there are many reasons, there are three main ones: IBM's genes, the legacy of antitrust and the rise of Microsoft.

Let's talk about IBM's genes first. Regardless of whether it was in the mechanical age that Watson was in charge of, or in the electronic age that was taken over by Watson Jr., its customer base was basically government departments, the military, banks, large companies, and scientific research institutions. It had never operated terminals. The experience of consumer products (consumer products) also looks down on such products.In the past, the way IBM sold computers was to sign big contracts with big customers.Computers in the 1980s, unless you are a professional, no one can play well.Therefore, IBM has always sold computers and services bundled together, and it still does so today. Once IBM signs a mainframe sales contract, not only can it directly earn millions of dollars, but it can also charge a service fee of about 10% of the sales price every year.When customers need to update their computers, nine times out of ten they have to buy from IBM.In this way, every time it negotiates a contract, it can sit back and collect money.So while the IBM PC was well received outside, it was lukewarm inside the company. The turnover of IBM PC in the first year was about 200 million US dollars, which was only equivalent to about 1% of IBM's turnover at that time, and the profit was not as good as negotiating the next big contract.You know, selling 100,000 PCs is more difficult than negotiating a mainframe contract.Therefore, it is impossible for IBM to consider raising the PC business to the strategic height of the company.

In 1982, IBM and the U.S. Department of Justice reached a settlement in an antitrust lawsuit.One condition of the settlement was that IBM allow competitors to grow.If it weren't for the emergence of the PC, this condition would have no real effect on IBM, because in the past, if a company wanted to develop a computer, it had to do hardware, software and services together, and the threshold was very high.However, with the PC, the situation is different.Because the main components of IBM PC, such as processor chips, disk drives, monitors and keyboards, etc., are either provided by a third company or are easy to manufacture, and its operating system DOS is Microsoft.Therefore, the IBM PC is easy to imitate. The kernel BIOS of the only operating system of the IBM PC is its own, but it is easily cracked.In just a few years, IBM PC compatible machines have sprung up like mushrooms after rain.If it were not for antitrust restrictions, IBM could prevent these companies from entering the market using their own technology, or directly acquire the best of them.However, with anti-monopoly restrictions, it can only turn a blind eye to this.On the one hand, he was unwilling to work hard to make PCs, and on the other hand, he couldn't stop others from making PCs. IBM had to watch Compaq, Dell and other companies grow bigger.

The third reason cannot be ignored. If we say that in the past 30 years, IBM has been alone and arrogant, and now its real opponent, Bill Gates, was born.I always tell people that Gates is the Napoleon of our time.In this peaceful age we live in, it is impossible for military commanders like Hannibal and Caesar to siege cities and loot pools, but there will be giants in business, which is a battlefield without gunpowder, and Bill Gates is the leader of the scientific and technological world. First person. At that time, in order to launch the PC as quickly as possible, IBM didn't even bother to develop the operating system itself, but invited bids from other companies. IBM first found the DR company (Digital Research), because the price was not negotiated, so it had to give up.Gates saw an opportunity. He bought the disk operating system (DOS) for $75,000 and sold it to IBM.The clever thing about Gates is that he didn't let IBM buy out DOS, but instead collected an inconspicuous copyright fee from each IBM PC.Moreover, there is a small loophole in the agreement signed by IBM and Microsoft. It does not make it clear whether Microsoft can resell DOS to others.Gates later seized this loophole and sold DOS everywhere. IBM was very unhappy and sued Microsoft several times.Because in everyone's opinion, this is bullying the small by the big. IBM has never won the sympathy of others and has never won. (In the United States, bullying lawsuits are often difficult to win, and even if they are won, it is impossible to get much compensation, because small companies have nothing to squeeze). IBM originally thought that the money-making part of the PC was the hardware worth thousands of dollars, not the software worth tens of dollars, but it was later discovered that this was not the case.With the advent of compatible machines, IBM was reduced to one of many PC makers, and profits were limited by competition.And there is only one operating system for all microcomputers. Although each operating system can't make much money now, the future is limitless.Clearly, Microsoft has taken a favorable position.Therefore, IBM decided to jointly develop the new operating system OS/2 for microcomputers with Microsoft, and jointly develop the software market for microcomputers.If it was someone else, maybe I would be happy to be a partner of IBM.However, Gates is not an ordinary person. His ambition is very lofty. He will not allow others to touch the big cake of microcomputer software, although the scale of Microsoft at this time is far from comparable to that of IBM.Gates Ming repaired the plank road and went secretly. On the one hand, he cooperated with IBM to develop OS/2 and earned a little short-term money. On the other hand, he made great efforts to develop the Windows operating system (Windows).When Windows 3.1 was developed, the Microsoft empire was formed.More than ten years later, one of the most successful CEOs in Silicon Valley said that any company that cooperates with Microsoft has no good results in the end. IBM may be the first loser among them.

It should be said that although IBM was the first to develop today's general-purpose personal computer, in the information revolution that began in the 1980s, IBM reluctantly became a laggard.At the same time, a new overlord Microsoft was born.By the end of the 1980s, since the performance of microcomputers doubled every 18 months, microcomputers gradually began to be competent for some tasks that previously required mainframes.In this way, the microcomputer began to endanger the mainframe market. IBM suffered serious losses and began mass layoffs for the first time in history.This period was the most difficult period in IBM's history.There was speculation at the time whether IBM would go out of business.