How the IBM PC became the de facto standard for desktop computers

Last Updated on September 29, 2019 by Dave Farquhar

I saw a question on a vintage computing forum this week: How did the IBM PC become the de facto standard for PCs, and the only desktop computer architecture from the 1980s to survive until today?

It’s a very good question, and I think there were several reasons for it. I also think without all of the reasons, the IBM PC wouldn’t have necessarily won. In some regards, of course, it was a hollow victory. IBM has been out of the PC business for a decade now. Its partners Intel and Microsoft, however, reaped the benefits time and again.

Here are the reasons.

Legitimacy. The name IBM was virtually synonymous with serious computing, so IBM deciding to make desktop computers brought that whole segment of the market a legitimacy it didn’t have before. Prior to IBM’s entry, desktop computers were a field full of upstarts with minimal name recognition. The only notable exception was Texas Instruments, whose computers didn’t exactly set the market ablaze.

The mantra for most of the 1980s was “Nobody ever got fired for buying IBM.” And in those days, it was true. When it stopped being true, it stopped suddenly.

Apple arrogantly ran an ad welcoming IBM to the PC market. Apple was right that IBM brought legitimacy to the young market, but that standard nearly drove Apple out of business in the mid 1980s (Pagemaker saved it) and again in the late 1990s (Steve Jobs saved it that time). Many analysts encouraged Apple to save itself in the 1980s by introducing an IBM PC clone. Which leads us to…

Open architecture. By being an open system, other companies could develop hardware and software for it, without IBM interfering. This allowed other companies to address the weaknesses in the system. In one notable case, AST Research crammed the functionality of six I/O boards into a single plug-in board. But in another case, Tandy bolted a TI sound chip onto the IBM PC architecture to make an IBM PC-compatible that could play games with sound. Later, Ad Lib produced a plug-in card with a Yamaha synthesizer on it for even better sound. Creative Labs followed, with what became the Sound Blaster.

In 1981, the IBM PC was thoroughly outclassed by the Atari 800 in the graphics and sound department, but by 1987, you could swap in a VGA graphics card and plug in an Ad Lib, and then the IBM PC had the advantage.

Being an open architecture also meant being cloned. The clones ultimately led to IBM’s downfall, which I’ve addressed before. Compaq hijacked the standard in the late 1980s and IBM never regained control of it. That led to faster processors getting bolted on to the architecture, and that was the missing ingredient. Sure, the architecture was crude and full of compromises, but as long as it was possible to keep ramping up the clock speeds, you could power through those inefficiencies.

IBM held off the clones for a time, with gray market PCs. But that was only a temporary measure, once the clones could undercut IBM’s wholesale pricing.

Speaking of pricing, it dropped quickly. By the end of the decade, it was possible to buy a slightly souped up IBM PC clone for a few hundred dollars. Even if you lived in a small town, you could buy an IBM-compatible Tandy 1000 at Radio Shack. Every small town had one. And of course, as volumes increased, prices decreased even further.

And that leads us to…

Compatibility. I was taught in the 1980s that someday, all computers would be compatible. And that’s true. I can buy a Mac and I can install Windows on it–the only difference between a Mac and a PC these days is the operating system and the styling. They run on the same hardware.

Nobody knew exactly how that was going to play out back then. But once compatible clones costing less than $1,000 appeared, promising the ability to take work home, the standard was pretty much unstoppable. Trust me, I denied it until 1994 because the Amiga was so much better, but IBM and the clones had the killer app.

Lotus 1-2-3. Lotus 1-2-3 was the best spreadsheet of its era, allowing people to take full advantage of the IBM PC’s available memory to do things Visicalc and other spreadsheets couldn’t do at the time. People bought IBM PCs to get 1-2-3. And then that meant all the best business software would get developed on the IBM PC first, since they were buying Lotus 1-2-3 anyway. Other platforms had killer apps too, but none of them had as big of a market as the Lotus 1-2-3 spreadsheet. And while Lotus 1-2-3 faded fast in the early 1990s, by that point, the PC’s momentum was unstoppable. Lotus 1-2-3 was replaced with Microsoft Excel and the rest of Office, and those apps weren’t going to get ported to the Amiga or Atari ST in 1994.

And speaking of Microsoft…

Microsoft’s foresight. Microsoft didn’t like to sell anything. They liked to license their stuff. When they licensed PC DOS to IBM, they reserved the right to license it to other companies too. Other companies quickly did, but those early DOS machines weren’t completely IBM-compatible. In the CP/M days that didn’t matter, and maybe over time it wouldn’t have mattered either, but then Compaq released a very close clone that was 99.999% compatible, and eventually, other companies did the same thing. Microsoft happily sold DOS and, later, Windows, to all of them. And Windows, by extrapolating out the hardware layer, did a lot to address the compatibility issues.

PC DOS eventually would have been cloned even if Microsoft had given exclusive rights to IBM. PC DOS was just a clone of CP/M, and eventually Digital Research turned CP/M into a clone of PC DOS. But Microsoft’s decision meant PC clones could appear in 1982, rather than 1987. Had the first PC clones appeared that late, the Motorola 68000 generation–the first Mac, the Amiga, and Atari ST–would have had a much easier time getting established. And then, perhaps, things could have turned out differently.