What does IBM compatible mean?

Last Updated on October 15, 2019 by Dave Farquhar

When you hear someone over the age of 50 talk about computers, or read old computer magazines from the 1980s, you may hear or see the phrase IBM compatible, or less commonly, PC compatible. What does IBM compatible mean? What does PC compatible mean? I’ll explain.

These phrases sound a bit odd today. After all, IBM made its last personal computer in 2003. And isn’t every PC just a PC? It wasn’t always. And that’s why we used to make a distinction.


what does IBM compatible mean
What does IBM compatible mean? IBM built its original IBM PC, introduced in 1981, using mostly off-the-shelf parts. This meant other companies could buy the same parts and build workalikes. These workalikes came to be called IBM compatible PCs.

When IBM designed the original IBM PC in 1980 and 1981, it used off-the-shelf components rather than its own. This allowed them to bring a computer to market much more quickly. They chose a CPU from Intel, and they really wanted it to run a programming language called Microsoft Basic and an operating system called CP/M. They ended up buying an operating system from Microsoft instead. DOS was very similar to CP/M, to the point that some people alleged it contained stolen code.

Bill Gates did a number of clever maneuvers to end up selling IBM an operating system. But Gates wasn’t done. Technically, he didn’t sell IBM an operating system. He licensed it to them, and he retained the right to license it to other companies. He knew that once he sold an operating system to IBM, other companies would want to use it.

IBM had modest expectations for its PC. It expected to sell perhaps a quarter-million units and last on the market until about 1984. Gates had loftier expectations for it. But it’s safe to say the IBM PC’s success exceeded both IBM’s and Microsoft’s expectations for it.

Not-quite IBM compatible

Gates was right about other companies wanting his new operating system. Not long after IBM released the IBM PC, lots of other companies, such as Digital Equipment Corporation and Vector Graphic and many others, licensed MS-DOS. They built computers with Intel CPUs, made them run DOS, made a few improvements to make their computers better than the IBM PC, and they flopped. The problem was that really well-behaved software would indeed run on these other computers. But a lot of software, such as Lotus 1-2-3, made assumptions about the hardware they were running on. For example, instead of writing to the screen the way IBM said to do it in the reference manual, they would address the video chip directly. If someone else used a more capable video chip that behaved slightly differently, Lotus 1-2-3 wouldn’t run.

Today we use device drivers to get around these compatibility issues. But in the early 1980s, when 256 kilobytes was a lot of memory and these CPUs ran at 4.77 MHz, the computers weren’t powerful enough for that kind of overhead. Being IBM compatible, it turned out, required more than just using the same CPU and operating system as IBM.

Had any of these computers caught on, it wouldn’t have been hard to revise IBM software to run on them. But all of these computers were slightly different, and none of them became popular because there was so little software that took advantage of them. It was the classic chicken-and-egg problem.

Compaq’s IBM compatible

what does IBM compatible mean
The Compaq Portable was a close copy of the IBM PC, so it was highly compatible, even though it came in a completely different form factor. It was portable, but software couldn’t tell the difference.

Compaq was an upstart company in Texas that decided to clone the IBM PC as closely as possible and put it in a portable form factor. It bought the same parts IBM did, or parts that worked identically. It licensed MS-DOS. Then, they worked on the other piece other companies missed. IBM computers contained a ROM chip, called a BIOS, for Basic Input Output System. Compaq reverse-engineered IBM’s BIOS without infringing on IBM’s copyrights. The result was a computer that worked almost identically to IBM’s PC, and ran all the popular IBM PC software titles.

Compaq sold a couple hundred thousand units every year. The Compaq Portable wasn’t any cheaper than the IBM PC. Its only selling point was that it was portable, in addition to being compatible and well-built. Compaq followed up with a desktop PC line, but didn’t try to undercut IBM’s prices by all that much. Mostly it looked for ways to offer something IBM wasn’t.

By the time Compaq released its 386-based machines, Microsoft actually did most of its development work on Compaq PCs, rather than actual IBM PCs.

So what does IBM compatible mean? If you’d asked Compaq in the mid 1980s, they would have said a computer with an Intel 8088 or similar CPU, MS-DOS, and a clean-room-engineered BIOS nearly identical to IBM’s.

Attack of the clones

what does IBM compatible mean
Labels like this one from 1990 were common, stating that the software worked on the IBM PC, Tandy 1000, and “most compatibles.” “What does IBM compatible mean?” wasn’t a question many people had to ask in 1990, though the question seems strange today.

Once Compaq released a successful IBM compatible PC, others followed. Most didn’t create their own BIOS. A few took their chances and just copied IBM’s BIOS verbatim. This left them open to lawsuits, which quickly put an end to that strategy.

Three companies, American Megatrends, Award Software, and Phoenix Technologies, each cloned IBM’s BIOS on their own, using methodologies similar to what Compaq did. But rather than go into the PC business, they offered their BIOSes for sale to other companies who wanted to make IBM-compatible PCs. It wasn’t long before hundreds of companies, big and small, offered IBM-compatible PCs for sale. Some of them charged 1/3 the price IBM charged.

Most of them weren’t quite 100% IBM compatible. In the mid 1980s, the answer to the question of what does IBM compatible mean was that the computer could run Lotus 1-2-3 and Microsoft Flight Simulator.

Some of them, like the Leading Edge Model D and the Tandy 1000, became so popular that software companies started testing their software on them to ensure they worked just as well on those as they did on a real IBM PC. But lots of companies got into the game, including even Commodore and Atari, though not with the same degree of success.

PC compatible means the same thing as IBM compatible. Some companies, especially Tandy, didn’t want to mention IBM by name. By the mid 1980s, “PC” was synonymous with the IBM PC, so people knew what Tandy meant.

Over time, deviations from IBM’s standard became safer. But you still saw methods to disable them in many cases, such as the turbo button on PCs from the late 80s and early 90s. And by the late 1980s, you could buy parts and build an IBM compatible PC yourself.

What does IBM compatible mean: In conclusion

IBM lost control of the PC market in the mid 1980s after a series of missteps. But the phrase continued into the 1990s. It’s not like there was ever a memo that went out telling people to stop using the phrase “IBM compatible.” But once Windows became popular, the attention shifted away from IBM and toward Microsoft. When AMD started releasing clones of Intel CPUs, it got permission to stamp them “Microsoft Windows Compatible.” By 1995, that was all people cared about. Since Windows used device drivers, it took care of most of the compatibility issues. And after IBM released its ill-fated PS/2 line, people didn’t trust IBM anymore. Over the course of a few years, IBM went from the perception of a safe choice to the perception of a manipulator while consumers fled to competitors like Dell.

That’s why you don’t hear the phrase “IBM compatible” all that much anymore. And that’s why some people consider IBM a failure. Today, instead, the perception is that a PC is a PC is a PC. It’s not, exactly, but Windows masks the differences to the point where software usually works regardless.

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