Definition: IBM

(International Business Machines Corporation, Armonk, NY) One of the oldest and most influential computer companies. With more than 250,000 employees, IBM derives its income from computers, software and services. See IBM Cloud.

IBM's hardware lines include its Z mainframes, midrange Power models and cloud-based Linux machines (see IBM Z, Power Systems and LinuxONE). IBM is heavily involved in quantum computing with the largest number of operational quantum computers worldwide. IBM's Condor processor was the first quantum computer with more than a thousand qubits (see quantum computing). The company also offers a variety of AI solutions with its watsonx line of generative AI, data integration and business intelligence.

Punch Cards Were the Beginning
In 1911, IBM began as the Computing-Tabulating-Recording Company, a merger of punch card, scales and time clock companies (see CTR). In 1914, Thomas J. Watson, Sr. became general manager, and over the next decade, he kept the punch cards and eliminated everything else, turning CTR into a data processing enterprise renamed IBM in 1924.

Watson also instilled a professional demeanor in his employees, and even service engineers wore suits. Before making repairs on greasy mechanical punch card machines, they took off their jackets and tucked their ties into their white shirts. This set apart IBMers from everyone else.

IBM achieved spectacular success with its punch cards. Although there was competition from Remington Rand, data processing throughout the world was mostly done on IBM machines. From the 1920s through the 1960s, IBM developed a massive customer base that was ideal for conversion to computers, later spearheaded by Watson's son, Thomas J. Watson, Jr.

IBM Became Synonymous With Computers
IBM launched its computer business in 1953 with the 701 and the 650 a year later. By the end of the 1950s, the 650 was the most widely used computer in the world. The 1401, announced in 1959, was IBM's second big winner (see IBM 650 and IBM 1401).

In 1964, the IBM System/360 was the first "family" of computers ever developed. Enormously successful, the 360 set a standard underlying IBM mainframes to this day. During the 1970s and 80s, IBM introduced several smaller computers, known as "minicomputers." The AS/400 was the most popular. In those early days, IBM was so dominant in the computer industry, it was known as "IBM and the Seven Dwarfs." See System/360, System 34, System 36, System/38, Power Systems and AS/400.

In and Out of PCs
In 1981, IBM introduced the PC into a chaotic personal computer field and set the standard almost overnight. Although one of the largest PC vendors for many years, IBM sold its PC business to Lenovo starting in 2004. IBM let Lenovo compete in the end-user market it created. See System X, IBM PC and Lenovo.

IBM Mainframes Still Flourish
In the late 1990s, IBM embraced the Linux operating system on all of its product lines, which was a major shift for a company known for proprietary software. Today, IBM mainframes continue to flourish as a huge amount of enterprise data is still processed by these machines with a lineage dating back six decades. In addition, IBM's Z series mainframes feature AI processing, quantum-safe encryption and extreme reliability. See IBM Z.

The Man Who Built an Empire

This photo of Thomas J. Watson, Sr., was taken in 1920, four years before he renamed the company IBM. (Image courtesy of IBM.)