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Computers, Personal

Computers, Personal


In 1976, the Cray-1 supercomputer was installed at Los Alamos National Laboratory in New Mexico. It was then the fastest computer in the world, performing 160 million floating-point operations per second. The computer cost 8.8 million dollars and generated so much heat that it required its own refrigeration system.

By 2001, anyone could buy a computer that will fit on a desk, is 34 times as fast as the Cray-1, and has 32 times the memory. Moreover, it can compute, connect to other computers, play music CDs, and show DVD movies. This newer computer can also burn CDs and DVDs. All of this computing power could be purchased for less than $5,000. There has certainly been a revolution.

What began as a box of parts to be assembled and tediously programmed by electronics enthusiasts has become a tool easily used by office workers and schoolchildren. The rapid growth of computer software has enabled personal computers to play games and music, to be used as intelligent typewriters, to perform mathematical calculations, and, through online capabilities, to be used for email and to connect to the vast treasures of the Internet. Computers have become smaller, more powerful, faster, more user-friendly, and versatile enough to meet almost any need.

The Earliest Personal Computers

The January 1975 cover of Popular Electronics magazine showed a picture of the Altair 8800. This small computer was actually a kit that had to be assembled and programmed. It had no monitor (screen) and no keyboard, and it performed few functions. The kit was sold to computer hobbyiststhat is, people who enjoyed building and programming the computers.

The Altair 8800 had 256 bytes of main memory, also called RAM (Random Access Memory). A major disadvantage of the Altair 8800 was that it had to be programmed in machine code, which is sequences of 0s and 1s that the computer understands. This machine code was entered using switches on the front panel of the Altair.

Beginner's All-Purpose Symbolic Instruction Code (BASIC) is a computer language that is easy to learn and was originally developed for use on large computers. BASIC converts English-like statements into machine code.

After seeing the 1975 Popular Electronics cover, a 19-year-old college student named Bill Gates and his programmer friend, Paul Allen, decided to write a form of BASIC that would run on a computer as small as the Altair. Gates and Allen believed there would be a demand for small computers and that these machines would need pre-written programs to run on them, called software. The two founded a company, called Microsoft, dedicated to developing software for small computers. By 1989 Microsoft's sales reached one billion dollars, and Bill Gates would eventually be considered the richest man in the world.

Another company dedicated to the small computer, Apple Computer, was founded on April 1, 1976, by Steve Jobs, Steve Wozniak, and Ron Wayne. The first Apple computer was only a bare circuit board (a thin plate on which electronic components are placed), and sold for $666.66 to hobbyists who would need to add a power supply, a monitor, and a keyboard. This machine, called the Apple I, sold about 200 units. Its 4,000 bytes of RAM (also called 4 kilobytes or 4K) greatly exceeded the Altair's 256 bytes.

More Advanced Personal Computers

The Apple II was introduced in 1977 and sold for between $1,300 and $3,000, depending on the options the buyer chose. A variety of software was available for this machine. Because it did not need to be programmed, people with little knowledge of computers or electronics could use it. The Apple II was a great commercial success. Over the next 16 years, there would be many models of the Apple II, with a total of over five million units shipped.

The first Apple II had 16K bytes of memory. The last Apple II, the Apple IIgs, had 256K bytes of RAM. It contained space for inserting additional memory so the amount of RAM could be expanded to 8 MB (8 megabytes, or 8 million bytes). Since the introduction of the Apple I, memory capacity had increased by a factor of 4,000. The Apple IIgs also had a color monitor, sound, a keyboard, and a mouse .

The market for personal computers greatly expanded in 1979 with the introduction of VisiCalc, a computerized spreadsheet. A spreadsheet is a program that allows a user to enter data into a table. The user can then solve complicated "what if" problems by manipulating the data. For example, a person could change one number in a budget and see the effect it has on the entire budget. This easy and fast capability for financial analysis made personal computers an important business tool.

By the early 1980s, over one hundred companies, such as Texas Instruments, Commodore, Tandy, and Digital Equipment Corporation, were making personal computers. Personal computers varied widely in their memory, speed, and the function capability. Their prices also varied, starting at about one hundred dollars up to thousands of dollars. There was a personal computer for every need and price range.

In 1981, IBM, which had been a leader in developing large computers, developed the first IBM personal computer (PC). It was a complete personal computer system with a great variety of software. The first IBM PC had 16K bytes of memory, expandable to 256K bytes. Its starting price was $1,565 but could cost much more depending on options. In the next eighteen months, 136,000 PCs would be sold. In 1982, other companies began producing personal computers that looked like the IBM PC. These machines would be called "clones ."

The same year, modems (standing for MOdulator/DEModulator) were introduced for personal computers. With a modem, a personal computer could transmit data to other computers, receive data, and access online databases over telephone lines. Modems allowed users of personal computers to communicate with each other through email and to connect to the Internet.

In 1983, Apple introduced a new computer called Lisa. Lisa was expensive and slow and did not sell well. However, Lisa incorporated a very important feature, the use of icons, that would influence later computers.

Before Lisa, computer users could only use commands or function keys to communicate with their computers. The introduction of pictures, called icons, which could be moved around on the computer screen as if they were objects on a desktop, allowed users to move a pointer on a screen using a mouse or trackball and click on a picture representing a command, file, or function.

This use of icons is called GUI (for graphical user interface and pronounced goo-ee). Using GUI, a person can control the computer without having to learn commands or use special keys. GUI was first developed at the Xerox Palo Alto Research Center in the 1970s but was popularized by Lisa's successor, the Apple Macintosh. The simplicity of using the "Mac" with its icons made it an enormous success.

Current Trends

The trend toward smaller and lighter personal computers began in 1981 with a suitcase-sized computer named the Osborne I. It was portable, although it weighed over 20 pounds, and had 64K bytes of RAM. The Osborne I cost $1,795 and was commercially successful. The Osborne Computer Company went bankrupt within 2 years, but portable computers became popular with the advent of laptops, notebooks, and handheld computers. Today, it is not technology but the size of the keyswhich have to match adult fingersthat determines how small computers can become.

An important milestone in the history of personal computers is the development of flexible software. Such software makes it possible for nonprogrammers

to use programs other people have written, such as spread-sheets, word processors, and games. The great assortment of software available has made the personal computer more and more useful to individuals and has therefore increased the demand for computers. And as more people own and use personal computers, the market for a wider variety of software products also becomes greater.

Today, personal computers are almost as much a part of American life as the telephone and the automobile. They are expanding their influence in education and are an integral part of many classrooms. Businesses rely heavily on them. Personal computers have become as much a communication device as a computational one. Communication by e-mail is common and the World Wide Web houses billions of pages of information.

Computers have also become more prolific than ever before. Cities all over the world have Internet cafes, where people can buy time on personal computers. Many hotels provide access to personal computers or have facilities for connecting their guests' laptop computers. As computers become smaller, they are also becoming wireless, using radio frequencies for communication. For less than $5,000 you can hold 8 million bytes of storage in your hand.

see also Computers and Binary System; Computers, Evolution of Electronic; Computers, Future of; Numbers, Massive.

Loretta Anne Kelley

Bibliography

Cringley, Robert X. Accidental Empires. Reading, MA: Addison-Wesley Publishing Company, Inc., 1992.

Linzmayer, Owen W. Apple Confidential. San Francisco, CA: No Starch Press, 1999.

Norton, Peter. Inside the IBM PC and PS/2, 4th ed. New York: Brady Publishing, 1991.

Osborne, Adam, and David Bunnell. An Introduction to Microcomputers, The Beginner's Book, 3rd ed. Berkeley, CA: Osborne/McGraw-Hill, 1982.

Shurkin, Joel. Engines of the Mind. New York: W. W. Norton & Company, 1996.

Internet Resources

Apple Computer. <http://www.apple.com/powermac/>.

Cray Computer. <http://www.cray.com/company/history.html>.

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personal computer

personal computer (PC), small but powerful computer primarily used in an office or home without the need to be connected to a larger computer. PCs evolved after the development of the microprocessor made possible the hobby-computer movement of the late 1970s, when some computers were built from components or kits. In the early 1980s the first low-cost, fully assembled units were mass-marketed. The typical configuration consists of a video display, keyboard, mouse, logic unit and memory, storage device and, often, a modem; multimedia computers add a sound-reproduction adapter, stereo speakers, and a compact disc (CD-ROM) drive to this configuration so that material can be presented in a combination of animation, graphics, sound, text, and video. Decreases in component size have made it possible to build portable PCs, or laptops, the size of a ream of paper and smaller, and palmtops, which can be held in one hand. Most current PCs have more computing power, memory, and storage than the large mainframe computers of the 1950s and early 60s. As the speed and power of the complex instruction set computer (CISC) processors used to power PCs have reached levels previously reserved for the reduced instruction set processors (see RISC processor) used in workstations, the distinction between PCs and workstations has blurred. PCs equipped with networking and communications hardware are often used as computer terminals. See also network; personal digital assistant.

See K. A. Jamsa, Welcome to Personal Computers (3d ed. 1995); J. Preston and M. Hirschl, Personal Computing (1997).

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personal computer

personal computer A general-purpose single-user microcomputer designed to be operated by one person at a time (see also PC). Personal computers range from cheap domestic or hobby machines with limited memory and program storage and an ordinary TV as the display device, to extremely sophisticated machines with powerful processors, large-capacity disk storage, high-resolution color-graphics systems, high-speed network interfaces, and many other options. In scientific, engineering, and business environments the personal computer has superseded the terminal connected to a time-sharing system, especially since communication ports and network connections allow transfers of data between the personal computer and other computers as well as client/server computing. The development of the personal computer is a consequence of the continually increasing ratio of computing power to cost, coupled with decreasing weight, size, and power consumption.

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Personal Computers

PERSONAL COMPUTERS


Personal computers (PC) were developed during the 1970s and were intended for use by small businesses and in the home. No established industrial computer company, like IBM, Burroughs, or Honeywell believed in 1975 that there would be any market for a PC. The earliest commercial PCs were credited to the efforts of Stephen Jobs (1955) and Stephen Wozniak (1950), who began their own PC company, Apple Computers, in 1976, building a microchip-based computer for small businesses and particularly for home use. These computers represented simplicity of design and function, and they were easily used by non-professionals. By 1977 the personal computer industry moved quickly, with Apple, Commodore, and Radio Shack aggressively entering the "home computer market."

The PC was made possible largely because of the miniaturization of electronic parts and the ability to reliably mass produce many parts of the computer, such as the silicon chip, the integrated circuit board, and the microprocessor. The personal computer evolved (in the 1960s and 1970s) from large single-function devices like industrial data processors to smaller single-function devices like pocket calculators. With smaller hardware and more diverse software, the PC of the late 1970s became consolidated into desktop sized, multi-function devices. They now provide international communications, word-processing capabilities, as well as the other educational, recreational, and personal functions associated with modern computers in homes and businesses.

See also: Computer Industry, Stephen Jobs, Stephen Wozniak

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personal computer

per·son·al com·pu·ter • n. a microcomputer designed for use by one person at a time.

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Personal Computers

Personal Computers

INDUSTRIAL CODES

NAICS: 33-4111 Electronic Computer Manufacturing, 33-4112 Computer Storage Device Manufacturing, 33-4113 Computer Terminal Manufacturing

SIC: 3571 Electronic Computers, 3572 Computer Storage Devices, 3575 Computer Terminals

NAICS-Based Product Codes: 33-41111, 33-41117, 33-4111D, 33-4111W, 33-41121, 33-41124, 33-4112W, 33-41131, 33-41134, 33-4113W

PRODUCT OVERVIEW

Origins of a Technology

Construction of the first electronic computer began in 1943. The device was called ENIAC (Electronic Numerical Integrator and Calculator). ENIAC used more than 17,000 vacuum tubes and was built at the University of Pennsylvania. It was intended to help the United States defeat the Nazi forces in World War II. The device was completed three years later. It was massive, weighing in at 30 tons, eight feet high, three feet deep, one hundred feet in length—and it was slow, taking 35 seconds to pull a square root. The vast machine received its inputs on punched cards and punched fresh cards to communicate its wisdom. Four years after ENIAC took its first lumbering steps, in 1950, a baby boy was born in Sunnyvale, California, to a couple whose surname was Wozniak. His parents named him Steven. Steve Wozniak would become the best-known of several co-creators of a new category—the personal computer. Wozniak, with Steve Jobs, co-founded Apple Computer in 1976. The Apple Computer reached the mass market in 1977. It was a tiny device in comparison with its great-grandfather ENIAC, easily fitting on a desktop, and communicating with the user by means of a lighted screen.

Apple Computer began in a garage in Los Altos, California, when the two Steves (Wozniak and Jobs) began to make circuit boards for hobbyists. A local computer store owner, Paul Terrel, had little use for circuit boards but offered to buy 50 finished computers for $500 each. Armed with a purchase order for a shipment of that size, Jobs persuaded an electronics distributor to give him parts on credit. The company immediately began to flourish, in part because of Wozniak's creativity in squeezing performance out of a minimum of resources, and in part because of Steven Jobs' inspired notion to call the product Apple, associating a very formidable product category with a playful and down-to-earth image. The timing was right. Hobbyists everywhere were building home computers. Micro Instrumentation and Telemetry Systems (MITS) began shipping the Altair 8800 in 1975. This device sold for $379 in 1975 as a kit for at-home assembly. Tandy's TRS-80, sold by Radio Shack, and the Commodore PET were introduced almost simultaneously with the first Apple. Computers had become so pervasive in the culture that customers, many of them in the computer field, immediately gave these products an intense and enthusiastic reception.

In the 31-year period between the completion of ENIAC and the introduction of the Apple computer, electronic computing was transformed. Tiny transistors had replaced hot, bulky, vacuum tubes. Magnetic media—tapes and magnetic drums—replaced punch cards for data storage. Video devices displaced most printer-based terminals, churning out commands and responses on paper. Speeds had increased tremendously. In 1969, a fertile year in computers, Gary Starkweather at Xerox invented the laser printer, but it would be years before lasers became standard printers in the office. Control Data introduced the first supercomputer in 1969. In the same year the U.S. Department of Defense launched ARPANET (Advanced Research Projects Agency Network), the forerunner of the Internet. In 1977 a hierarchy of computers were available, with supercomputers at the peak, intended for scientific work; mainframes serving industry; minicomputers being used in smaller companies; and microcomputers beginning to reach households. Despite the fact that IBM had invented floppy disks in 1967, and had introduced the first hard-drive in 1973, the first microcomputers used tape recorders for saving information.

The personal computer, referred to as the PC, took off dramatically as soon as it was introduced and, within approximately five years, developed into a fully functional office tool. Early models with relatively limited capacities, aimed initially at the recreational and hobbyist markets, improved substantially. IBM, the undisputed leader in computers, entered the market in 1981 with an operating system developed by a small company called Microsoft. This machine, dubbed the IBM PC, became the standard product used in offices. By 1983 an estimated 10 million small computers were in use.

So What Exactly Is a Personal Computer?

A PC is a small computer and is capable of rapidly obtaining, manipulating, storing, and calling up information for the user in a changed format if required. For these purposes, it has: (1) a central processing unit (CPU), (2) a memory, and (3) input and output ports. It acquires information and commands through input ports by means of stored data on disk, by keyboard, by mouse movements, and, if the device is so enabled, from any source capable of feeding it digitized information. It communicates through output ports to video terminals, printers, permanent storage disks, sound systems, and other devices capable of receiving digital signals.

The core of the computer is an arrangement made of transistors. All information in the computer is held by capacitors, tiny devices able to hold energy or to release it, to be on or off. Computers are digital devices. Everything is created from 0s and of 1s. Every capacitor needs something to switch it on or off. Transistors are such switches. By a convention used universally, the American Standard Code for Information Interchange (ASCII), defines the alphabet, numbers, and many special symbols as fixed binary values. For example, the capital letter A has the value of 10000001. These eight bits of information are treated as one unit, called a byte. To hold this number eight capacitors and transistors are employed. Indeed, to hold the text of this paragraph, including the spaces that separate the words, 7,952 transistors and capacitors will be kept busy until this paragraph is saved and the file is closed.

The heart of the computer is its CPU. Its control circuitry monitors ports and responds to commands, obtained directly from the keyboard, the mouse, or a stored program it has been asked to execute. In carrying out commands, the CPU sends messages to output devices, obtains information from and stores data to memory, interprets programs in memory by reading commands from them sequentially, and manipulates data using its arithmetic/logic unit (ALU) if required by the commands it decodes. The ALU operates on data placed in the CPU's special memory locations, known as registers. The CPU's controls permit it to recognize special interrupts. When an interrupt arrives, the CPU suspends the execution of the currently running program and picks up execution of another, keeping track of everything in specially set-aside areas of memory. The CPU's communication with the rest of the machine take place via special data highways known as busses.

Three hierarchically arranged instruction sets tell the CPU what to do. A built-in and hard-wired program, known as the kernel, becomes operational as soon as the machine is turned on. This program handles the basic functions, including booting of the operating system (OS) from the hard drive. The OS contains the second layer of instructions. It resides in memory. Once up and running, it displays its own visual interface and responds to user commands. The third level is represented by user-activated software programs. One or more programs may be running at any time. These might be, for instance, a word processor, a spreadsheet, and an Internet connection.

In modern PCs functions such as visual display, printing, and disk operations are distinct units with specialized processors of their own so that the CPU's capacity is not diverted to routine tasks. Very advanced functionalities are available to the user wishing to have high-end graphical, audio, or communications capabilities. These devices are integrated into the computer as cards, which are placed into slots left open for just such add-ons on the computer's motherboard.

Measures of Performance

Computer performance is measured by CPU speed, processor size, and internal memory available. Speed is measured in cycles per second, thus sequential single actions the CPU can perform in that time. The speed is measured in megahertz (MHz), millions of cycles per second. Computer speeds have increased, making it necessary to report speed in gigahertz (GHz), billions of cycles. The faster the processor the more instantaneous the performance of the machine appears to the user. But effective speed also depends on the performance of the computer's bus, of the memory, of the disk drive, and of other componentry that contributes to the computer's total action. A slow memory, for instance, will slow down the CPU by causing it to stop with interrupts until it has performed its job. The Apple I operated at 1 MHz. High-end PCs in 2007 were running at approximately 3,500 to 3,800 MHz.

The number of bits handled by the CPU processor size determines the number of bits the CPU can handle at the same time. The first Apple computer could handle an 8-bit number or single byte at a time. The high-end PCs at the end of the first decade of the twenty-first century could handle eight bytes, or 64-bit numbers at a time. Most computers sold were 32-bit machines. Processor size or width, expressed in bits, is directly related to the amount of memory a CPU is capable of addressing. As a consequence increasing CPU width has resulted in making more and more memory directly available to users without using artful workarounds that characterized earlier machines.

Most modern PCs come with a minimum of 512 megabytes of random-access memory (RAM), mega meaning millions, and the unit abbreviated as MB. One megabyte is equivalent to 1,024,000 bytes—a number that, expressed in the base-16 hexadecimal numbers scheme is an even number (FA000). In the computer world, measurements are describe in hex, consequently their translations into the decimal scheme do not round up precisely. For this reason 512 megabytes are equivalent to 524 million bytes. We can get some feel for this number by expressing it as roughly equivalent to 75 million words separated by spaces. To read that many words we would have to devour roughly 1,250 moderately sized novels. High-end machines can have as much as 2,000 MB of RAM. The first Apple offered 8,000 bytes of RAM or approximately 1,000 words of storage, less than one page of single-spaced typing.

Product Evolution

The personal computer rapidly evolved over a 30-year period from a hobbyist's device and a game-playing utility into—initially—an office machine first used intensively with spreadsheets, for analysis and accounting, and word processing software, for correspondence. Apple introduced the first commercially available graphical interface with the Macintosh computer in 1984 and almost immediately created a new use for computers in visual arts and advertising applications, a niche it continues to dominate. The graphical interface soon replaced character-mode computing with the introduction of the Windows operating system in 1985. Graphical interfaces prepared the ground for widespread use of the Internet.

As part of the PC evolution, freestanding machines began to link together. During the 1980s more office machines were connected by cable into local-area networks all communicating with a common computer that acted as a file server. With the rise of networks, a single connected PC still only served one user, but the network itself began to resemble the old mainframe computer in that individual users were getting from and storing to the common disk space provided by the server. These networks made it possible to deploy database software with sufficient storage to duplicate the capabilities once only possessed by mainframes and minicomputers.

In 1984 when the Macintosh appeared, approximately 1,000 computers were connected to the system that would later emerge as the Internet. According to Hobbes' Timeline of the Internet, the number of hosts, or connected computers, increased to 313,000 by 1990, 36.7 million by 1998, and 439.3 million by 2006. The emergence of this new technology in the last third of the twentieth century altogether redefined the personal computer. Without losing the functions that it had acquired along the way—entertainment, office tool, database and graphics engine—it became principally and primarily a communication tool.

The basic machine also proliferated into small devices, initially into portable and then laptop computers, and then into handheld personal digital assistants (PDAs). Finally—merging its functions with that of the telephone and TV and thanks to the vast expansion of wireless communications—the machine became a tiny handheld device capable of acting as a computer, a telephone, a radio, a television set, a music server, and a camera. To be sure, these latest tiny descendants of the venerable ENIAC are no longer, properly speaking, personal computers. That designation still pertains to desktop computers, portables, and laptops. Functionally, however, all of these devices are identical and could not exist without transistors engineered into tiny CPUs with enormous power and speed using information storage media of incredible density.

MARKET

Computer Hardware

In 1987, ten years after the introduction of PCs, U.S. production of all computers was valued at $23.2 billion. The U.S. Bureau of the Census did not report on PCs as a distinct category in that year. The first time that PCs appeared statistically well defined in national accounts was in 1992. In that year PC shipments were valued at $18.7 billion and represented 65 percent of all computers shipped. The total market was $29.6 billion. Other major subdivisions of the computer market were multi-user host computers, or mainframes and minicomputers ($8.6 billion), and special-purpose computers, including analog and hybrid machines ($1.3 billion).

Domestic production of computers, including PCs, peaked in 1999. In that year total shipments of computers stood at $64.7 billion, with PCs representing 66.1 percent of shipments and a $42.8 billion market. Domestic shipments declined after 1999. Shipments were being buoyed throughout the 1990s by the explosive growth of the Internet, usually referred to as the dot-com boom. The dot-com bust occurred in early 2000 when the tech-stock-heavy NASDAQ Composite Index reached an all-time high of 5048.62 (March 10). As of the spring of 2007, the NASDAQ had not reached that level again. The recession from 2000 to 2001 dried up capital expenditures. Data on domestic shipments at time of writing were available to the year 2005. Since 1999 domestic shipments have declined at a rate of 8.3 percent per year. Domestic shipments of multi-user computers declined most (9.3%), and special-purpose machines declined least (2.5%). Demand for computers declined as well in the 1999 to 2005 period but at the lesser rate of 2 percent per year. Demand dropped from a 1999 high value of $68.3 billion to a low of $48.9 billion in 2002. It began to grow again in 2003 and reached $60.6 billion in 2005. The gap between domestic supply and demand was filled by imports. The market picture is presented graphically in Figure 170.

Domestic demand is shown in bars in the graphic. The value of demand is calculated by taking domestic shipments, deducting exports, and adding imports. It is worth noting that in 1997 total domestic shipments and demand were approximately at the same level but that, as time advances, U.S. production totals are at increasingly lower levels than total demand. Indirectly, the chart reveals that more of the U.S. demand is being satisfied by imports.

Figure 171 makes these relationships explicitly visible. In the 1997 to 2005 period, a major change had taken place in the computer industry. Furthermore, in that personal computers represent more than two-thirds of the industry, these changes directly affected the product. U.S. exports were valued at $5.9 billion in 1997, peaked at $7.4 billion in 2002, and declined somewhat by 2005. Domestic hardware production was on a downward slide, having reached a level, at $38.4 billion, slightly above the level achieved in 1994 ($38.1 billion but not shown on the chart). The category exhibiting unambiguous and sustained growth throughout this period was imports, increasing from $6.4 billion in 1997 to $29.1 billion in 2005. Representing 12.6 percent of total domestic demand in 1997, imports satisfied 48 percent of demand in 2005. Other countries were making a product category entirely invented, pioneered, and perfected in the United States.

Peripherals

Users of the PC define it as consisting of the computer itself, its monitor, and a mouse and keyboard. In the realm of industrial statistics the computers are divided into the computer itself and then into different categories of peripherals. These categories are: (1) storage devices including floppy, hard, and tape drives; (2) terminals; (3) other peripherals, including keyboards, printers, modems, cash registers, and other equipment; and (4) magnetic and optical media, including floppy disks, CDs, and magnetic tape. In all of these categories, trends in domestic production are pointing downward, as shown in Figure 172.

Domestic demand for these categories did not decline in this period. Instead, as in computer hardware, imports have replaced domestic production. For example, demand in 2005 for storage devices was valued at approximately $16.2 billion and for terminals approximately $10.3 billion, indicating that more than two-thirds of disk drives were imported and virtually all terminals originated overseas. The U.S. Census Bureau does not specifically report on which portions of the peripherals market relate to personal computers but two categories—other peripherals, and magnetic and optical media—include large segments related to devices used in commerce, such as cash registers, and to mainframes and minicomputers.

Software

Although the software market is intrinsically dependent on the hardware platforms which it animates, software sales represent a much larger market and also display another trend. Data available from the Services Annual Survey indicate that in 2005, software sales at the producer level amounted to $119.6 billion, more than three times the size of computer hardware produced domestically and nearly twice the value of the demand for machines. Moreover, software sales have been growing. They increased from $84.0 billion in 1999, increasing at the rate of four percent per year.

The software market is traditionally reported in three major segments. Systems software is the largest (39.3%), applications software is next (35.7%), and other services bring up the rear (25.1%). Operating systems represent approximately 39 percent and network software 27 percent of the systems category. Business productivity and home-use applications (including games) account for 45 percent of applications. Other services include preparation of custom software and providing consulting, training, and similar services. It is difficult to separate software used in strictly personal contexts from that which is used for commercial or institutional purposes. The Census Bureau estimates that nearly half of total software sales are associated with personal computers, accounting for $59 billion of the total. The remainder is used for mainframes, minicomputers, and special-purpose computers.

KEY PRODUCERS/MANUFACTURERS

The PC market is global. The top companies sell worldwide and/or procure their products from many countries. The division of manufacturing chores between specialists also explains why imports have come to play such an important role in this industry.

Two companies dominate the manufacturing of CPUs, the core of a computer. They are Intel Corporation and Advanced Micro Devices (AMD). All other producers buy their chips and then build computers around them. The top five companies, as reported in Market Share Reporter, with 2004 market shares shown in parentheses, are Dell Inc. (30.3%), Hewlett-Packard Company (18.4%), Gateway, Inc. (5.8%), IBM (4.7%—but IBM sold the product line to Lenovo late that year), and Apple, Inc. (3.2%). These five companies commanded 62.4 percent of the total U.S. market in 2004. The overwhelming majority of all PCs run on operating systems produced by Microsoft Corporation. Microsoft is the top-ranked software producer in the world. The company also dominates the PC applications market. Apple offers its own operating system but is producing machines able to run on Microsoft's Windows platform, showing that even Apple needs to accommodate itself to the de facto standard set by Microsoft.

Equipment Type Industry 1997 Shipments 2005 Annual Rate of Decline
(billions of dollars)
Storage devices8.67.5−1.7
Terminals0.80.2−13.6
Other peripherals13.77.7−6.9
Magnetic and optical media5.21.3−15.9
Total28.316.7−6.3

Intel Corporation is a $35.4 billion company (2006) and holds the commanding market share in semiconductor chips. The company has 94,100 employees, more than 50 percent of whom are located in the United States. The company produced 68 percent of its products at U.S. plants and 32 percent in plants located in Ireland and Israel. Second-ranking AMD had 2006 sales of $5.6 billion. The company's chip manufacturing facilities are in Germany. Its chip assembly is performed in Malaysia. Testing is conducted in Singapore and in China.

Like the chipmakers themselves, computer producers are also global companies. Dell Inc., for instance, the leading PC producer, with $55.9 billion in sales in 2006 (fiscal year ending February 3), maintained 3.6 million square feet of manufacturing space in the United States and had 2.3 and 3.9 million square feet in Europe and in Asia, respectively. Hewlett-Packard, ranked second in PC sales, had revenues of $91.7 billion of which personal computers accounted for $29.2 billion. The company had worldwide operations, including facilities in the United States, Germany, Ireland, The Netherlands, Israel, the United Kingdom, China, Japan, and Singapore.

In Gateway, Inc.'s 10-K filing with the Securities and Exchange Commission, the company discusses its manufacturing by saying: "Gateway's product needs are fulfilled through original design manufacturing and distribution relationships in Asia, Europe, Mexico and the United States to meet the needs of key market segments." The phrase, "original design manufacturing," became the acronym ODM in the early 2000s and stood for a widespread practice under which manufacturers design products but others do the manufacturing to their specified design. Intel, in its own 10-K report, refers to those reliant on ODM as "fabless" producers, perhaps coining a phrase to indicate a lack of fabrication facilities. Gateway itself, however, launched a facility in 2006 for final assembly of what it describes as configure-to-order desktops, laptops, and servers. Gateway had sales in 2006 of $3.98 billion.

Lenovo Group Ltd. is a Chinese corporation but has its headquarters in Raleigh, North Carolina. The company is the inheritor, by acquisition, of IBM's personal computer business. IBM left the business in 2004. PCs had moved from the status of a hi-tech product with healthy margins to a commodity category, and IBM sought to deploy its assets into more profitable branches of the computer business. Lenovo's sales in 2006 were $13.3 billion. Notebook computers represented 49 percent and desktops 45 percent of sales; the remainder accounted for by handheld and other devices. The company ranks third-largest in the world (behind Dell and Hewlett-Packard) but ranks fourth in U.S. sales.

Apple Inc. changed its name in 2007 from Apple Computer, Inc., perhaps signaling, in its own way, that the age of the PC is passé and that the iPod and iTunes represent the modern world. Indeed, only slightly more than 50 percent of the company's total sales of $19.3 billion in 2006 were represented by computers, peripherals, and software. The remainder amount was accounted for by iPods and music. Apple's first PCs were made in a garage in California by hand by one of its co-founders. In 2006 assembly of computers took place in Apple's own plant in Cork, Ireland, or under contract by others in California, Taiwan, North Korea, and in the Czech Republic. All portable products made by Apple were assembled in China. Substantially all componentry used by Apple was manufactured in Taiwan, China, Korea, and Singapore. Apple retains, from its origins, a comprehensive profile in that the company continues to sell hardware, its own operating systems, and its own monitors and other peripherals. Apple has the largest and most loyal customer base. From its beginnings the company had acceptance in the educational community, promoted by its own generosity. The Macintosh became the choice of all those specializing in high-end graphics applications.

The giant among software companies, and overwhelmingly so in the PC market, is Microsoft Corporation. The company had sales of $44.3 billion in 2006. Of that total approximately 73 percent was directly related to personal computers or smaller devices. The company's five largest segments were operating systems ($13.2 billion), office software ($11.8 billion), server software for networks ($11.5 billion), and home and entertainment software ($4.3 billion). Office software includes Microsoft Office used by many people both in the workplace and in home applications. Microsoft contracts out most of its manufacturing activities to others.

Microsoft identifies its major competitors by segment. The company's rivals in the operating system segment are Apple, Hewlett-Packard, IBM, and Sun Microsystems. Apple competes with Microsoft directly in the PC market. Hewlett-Packard and IBM have always sold operating systems for their own brands of large computers, those that predate the PC. Sun Microsystems is also principally a competitor for Microsoft in the commercial rather than the personal segment of computing. Sun offers Solaris, a version of the Unix operating system developed at Bell Laboratories (1969–1971) for mainframes. Sun, like Apple, also supports Windows on the Sun brand of desktop computers.

Microsoft's competitors in the office software category include Apple, Corel Corporation, Google, IBM, Novell, Inc., and Oracle, among others. The company points out that it faces competition in Europe and Asia. Apple has always offered its own applications software or software produced by others for its operating system. Corel is well-known for its graphics and drawing programs; Corel also acquired the once-dominant WordPerfect word processing system still used in many offices. The leading word processor in the early 2000s was Microsoft Word. Microsoft lists Google as a rival because the company has Web-based word processing and spreadsheet products. IBM competes with Microsoft with a product array very similar to Microsoft Office. IBM acquired Lotus Development Corporation in 1995 and, during the first decade of the twenty-first century, offers SmartSuite which includes spreadsheet, word processing, presentation, and other office tools. IBM is still active in this segment of the PC market although it severed its connection to hardware. Novell, a systems company best known perhaps as a pioneer in networking PCs, is oriented toward Unix and offers product suites comparable to Microsoft Office. Oracle and Microsoft compete primarily for entry-level database applications.

The software market is extensive. It has many niche markets still profitably served by Microsoft's competitors. Unix users as a group represent the largest segment. Unix itself comes in several variants. Solaris is one. Linux is supported by Red Hat, Inc. and is popular because it is free-ware; Red Hat, however, sells products running on Linux. The field is also large and diverse enough so that a detailed discussion of it goes beyond the scope of this essay. Microsoft is featured prominently by reason of its dominant share of the PC software market.

MATERIALS & SUPPLY CHAIN LOGISTICS

The PC industry is characterized by a wide distribution of its production functions. Some companies specialize in major components or subcomponents; some provide design and specification functions; others fabricate, and then specialize in marketing and distribution; and yet others concentrate on fabrication, assembly, and testing. The industrial structure is economically and logistically justified because the basic components are physically light, usually small, and the items have high value. Most are produced by automated processes with relatively low inputs of labor but high inputs of capital. Assembly and testing require the most labor. Components and subassemblies are therefore shipped extensively from point to point before being put into the final product at the ultimate assembly location.

DISTRIBUTION CHANNEL

Personal computers nominally have a three-tier distribution system. Product moves from producers to wholesalers, from wholesalers to retailers, and then to the consumer. The word nominally is appropriate because, over time, fewer and fewer computers or software products are passing through the formal retail channel. The retail sector in this industry is very small, approximately $11.6 billion in 2006 according to Manufacturing & Distribution USA, and has declined from a level of $24 billion in 1997—which was quite small. Distribution in this industry is, in effect, something of a hybrid.

Most computers move from the producer directly to the customer triggered by mail, online, or telephone orders, the producer acting as the retailer—or the product passes through an integrator/wholesaler who supplies companies and also, usually through the company's intermediation, to individuals. The wholesale sector had sales in 2006 (including computers, peripherals, and software) of $266 billion, up from a level of $221 billion in 1997. The wholesaler is very often an integrator, providing services to corporate clients. Equipment sales are a natural part of installing networks for a company, adding nodes as these are required, and maintaining such systems over time.

KEY USERS

Personal computers may best be classified by the context of use. Computers in the home are used for Internet access, e-mail, games, homework (both of the school and the office variety), for storing, printing, and sharing photographs taken by digital cameras, and for a wide range of hobbies and administrative chores. The same people who use home computers will also use essentially identical machines at the office.

Use of the computer may be classified as heavy, casual, or intermittent. In heavy use the computer is central to daily life, e-mail is checked by the hour, and several computers may well be running, augmented by hand-held devices.

An important subset of users include those who work at home and for whom one or several computers will be the chief means of earning a living.

ADJACENT MARKETS

In the sense of substitutes for the personal computer no products come to mind, but one is reminded of the days when people used telephone lines to reach mainframes and thus time-shared massive but slow computer resources with many others. The telephone was once used for many rapid coordination activities now accomplished by e-mail. Before word processors and spreadsheets took over, typewriters and calculators performed the same basic functions software and PCs now do rapidly and with little effort. The PC, especially in its most modern incarnation as a communication and general office tool, has no substitute. Heavy users often feel as if the world had suddenly stopped when the computer dies or the network crashes.

Four markets adjacent to the PC are: (1) computer furniture, (2) extensive publishing activity ranging from books to magazines, (3) computer integration and support markets, especially PC networking by cable or wireless means, and (4) custom software production, consulting, and training services.

RESEARCH & DEVELOPMENT

Smaller, faster, without wire: the phrase describes the R&D thrust in the computer industry. In 1965 Intel co-founder Gordon E. Moore predicted that the number of transistors on a chip would double every other year. His prediction turned out to be correct. In 1970, 4,000 transistors were crowded on a chip—in 2006 more than a billion transistors fill a chip. Moore's prediction has come to be known as Moore's Law.

Semiconductor fabrication processes are referred to by the size of the transistor. In 2007, 65-nanometer technology prevailed, meaning that transistors were 65nm in size. A nanometer is one billionth of a meter. In 2007, 45nm chips were under development by Intel, AMD and IBM in partnership, and Toshiba and NEC Corporation. In 2008 or 2009, 32nm and 22nm transistors will be available. According to Intel, the 45nm chip, based on replacing silicon dioxide with a hafnium-based material for transistor gates (insulators), will double the number of transistors per chip but will cut energy consumption by 30 percent. Switching speeds will increase 20 percent. More speed is also promised by designing CPUs for processing of two activity threads simultaneously, a technology under development that Intel calls hyper-threading and AMD dubs multi-threading. Such capabilities permit parts of the same program to be carried out at the same time—or two programs running side by side—saving seconds in both cases.

Substantial R&D is also being dedicated to expanding signal transfer without the encumbrance of wires. Developments are guided by two standards issued by the Institute of Electrical and Electronics Engineers (IEEE). 802.11 relates to WiFi and 802.16 to WiMax systems. WiFi refers to wireless local-area networks. The term is a play on the old Hi-Fi designation used by home stereo enthusiasts. WiMax stands for Worldwide Interoperability for Microwave Access. Systems under these standards promise very fast, 10-billion bits per second, broadband transmissions of signal between mobile and fixed installations, or multiple fixed installations, several miles distant from each other.

All of these developments point toward both miniaturization of machine intelligence and making it mobile. Developments in support of embedded products—chips on all kinds of mobile or stationary equipment capable of acquiring or generating signal without wire—are receiving substantial R&D funding but, in effect, are aimed at products no longer even remotely like personal computers.

CURRENT TRENDS

The electronics sector, built on the base of the technology that PCs introduced, continued to grow as the first decade of the twenty-first century advanced. At the same time, the PC category showed signs of having reached maturity. The very interest in hand-held devices that acted as telephones and cameras but could still be used for texting with one's friends, indicated that attention had shifted from PCs. Similarly, the PC category itself was entirely taken for granted while commercial and entrepreneurial focus were turned on the Internet. IBM's sell-off of its PC business and Apple's name change were straws in the wind. PCs had their glorious spring in the 1970s, their youth in the 1980s, their peak in the 1990s, and had turned into very productive and rather sober adults by the beginning of the twenty-first century. The future promised growing maturity: ever better machines able to carry out virtually any task that could be framed in symbolic notation. The excitement had abated and had moved on, leaving behind a gigantic industry pervading every nook and cranny of domestic and institutional life. In that industry change would be relatively slow but steady and add-ons incremental rather than dramatic.

TARGET MARKETS & SEGMENTATION

Producers in this industry divide the market into entry-level, middle-of-the-line, commercial, and high-end machines by selecting processors with different speeds, providing less or more memory, and leaving out or making "standard" high-end functionalities, for sound or graphics, for example. Standard offerings at all levels are common, using low price at the entry level and features at the high end to target customers. Targeting relies on the user's technical sophistication. High-end users—or the managers who buy for them—understand and value technical features. Entry-level buyers are looking for functionalities, such as the machine's ability to display their favorite games or to hold their large stores of photographs. The highest end of the market is the network server, almost always selected after analysis of the system it will anchor. An important special segment is the user of a laptop computer who is interested in weight, in the performance of the battery-pack that powers the computer, and the machine's ability to be connected to the main computer in the office or the home to upload or download files for a customer visit or a trip.

RELATED ASSOCIATIONS & ORGANIZATIONS

Association for Computing Machinery, http://www.acm.org

Association of Women in Computing, http://www.awc-hq.org

Computer & Communications Industry Association, http://www.ccianet.org

Consumer Electronics Association, http://www.ce.org

Electronic Industries Alliance, http://www.eia.org

IEEE Computer Society, http://www.computer.org/portal/site/ieeecs/index.jsp

Portable Computer and Communications Association, http://www.pcca.org

BIBLIOGRAPHY

"Computer History." Computer Hope.com. Available from 〈http://www.computerhope.com/history/index.htm〉.

"Computers and Peripheral Equipment: 2005." Current Industrial Reports. U.S. Department of Commerce, Bureau of the Census. January 2007.

Darnay, Arsen J. and Joyce P. Simkin. Manufacturing & Distribution USA, 4th ed. Thomson Gale, 2006, Volume 2, 1239-1243.

Lazich, Robert S. Market Share Reporter 2006. Thomson Gale, 2006, Volume 1, 405-408.

"Meet the World's First 45nm Processor." Intel Corporation. Available from 〈http://www.intel.com/technology/silicon/45nm_technology.htm〉.

"Moore's Law." Intel Corporation. Available from 〈http://www.intel.com/technology/mooreslaw/index.htm〉.

"Product Summary: 2002." 2002 Economic Census. U.S. Department of Commerce, Bureau of the Census. March 2006.

Seibold, Chris. "April 7, 1976: Steve Jobs Gets Crucial $5,000 Loan." Apple Matters. Available from 〈http://www.applematters.com/index.php/section/history/april-7-1976/〉.

"What's In A Name Change. Look At Apple." Forbes. 25 January 2007.

Zakon, Robert Hobbes. "Hobbes' Internet Timeline v8.2." Available from 〈http://www.zakon.org/robert/internet/timeline/#Growth〉.

see also MP3 Players, PDAs & Smartphones

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Personal Computers

Personal Computers

Since they were introduced in the 1970s, the rapid-fire innovations in personal computers (PCs) have continuously changed the way Americans live. Hundreds of individuals, companies, and institutions were involved in the innovations, but by the 1990s and early 2000s, two corporations, Microsoft and Apple, and the two men at their helms, Bill Gates (1955–) and Steve Jobs (1955–), stood out.

IBM

In the early 1950s, International Business Machines Corporation (IBM) moved away from its punch card systems of calculating and began to market business computers. IBM originally specialized in manufacturing mainframe computers, computers as big as a room—sometimes larger—and requiring specially trained employees to program and enter data into the computers through punch cards. IBM's new computers were smaller and featured transistors (tiny electronic switches) instead of vacuum tubes (devices in older electronic systems that amplified signals). In 1965, IBM introduced a line of small, fast business computers with their own exclusive software. (Software consists of programs that operate the computers, a set of coded instructions that tell a computer what tasks to perform). From 1965 to 1975, IBM sold 65 percent of all U.S.computers.

Intel and computer chips

In the 1960s, integrated circuitry was introduced. An integrated circuit, also called a computer chip or microchip, is a small electronic device made out of a semiconductor material that contains thousands or even millions of transistors and other components. These chips were originally designed for use in calculators. In 1968, a new company called Intel began to produce computer chips.

In 1969, a Japanese calculator company asked Intel to produce twelve computer chips for the different functions of its calculators. After some experimenting, Intel came up with one chip that could do all functions. Realizing that this tiny chip, only a tiny fraction of an inch long, could process as much data as a room-sized business computer, Intel bought back their design. By the end of 1971, Intel was selling its computer chip for $200, making computer power (but not yet the computer itself) affordable enough for the general public for the first time.

Altair

The Intel chip caught the attention of Ed Roberts (1942–), who owned Micro Instrumentation and Telemetry Systems (MITS), a company that sold kits for assembling electronic devices. He decided to create a kit for building a home computer based on the Intel chip. Before he had quite finished his new product (which he called Altair after a character from the Star Trek television series), Popular Electronics magazine published a cover story about it. The Altair home computer came out in 1975. Considered the first personal computer, it was very limited, lacking a keyboard and video display. Nonetheless, orders for the $397 computer kit poured in.

Microsoft and the software business

Two young men were keenly interested in Altair: William H. (Bill) Gates, a nineteen-year-old sophomore at Harvard University, and Paul Allen (1953–), a twenty-one-year-old fellow computer enthusiast. They wrote a Basic All-purpose Symbolic Instruction Code (BASIC) Interpreter for the Altair—the first computer language program written for a personal computer.

Forming a partnership called Microsoft, Gates and Allen entered a contract with MITS regarding the Altair computer. Under the contract, Roberts retained rights to sell the hardware, or physical parts of the computer, and could use and market the BASIC software with it. Microsoft retained ownership of the computer language and software. This relationship

between a software developer and a hardware manufacturer became a model for future software licensing agreements.

By the end of 1976, Gates had dropped out of Harvard and set about convincing corporations of the future of the small computer, licensing BASIC to companies such as General Electric and Citibank, among others. Microsoft then developed two other programming languages, FORTRAN (1977) and COBOL (1978), becoming the leading distributor for microcomputer languages.

Enter Apple

In 1975, twenty-year-old Steve Jobs teamed up with Steve Wozniak (1950–) in a partnership for building and selling reasonably priced personal computers. Wozniak brought brilliant engineering skills to the partnership, while Jobs understood the business and marketing end.

Jobs and Wozniak formed Apple Computer Company in 1976 and released their first product, a desktop computer. Apple I was little more than a circuit-board layout. Buyers had to hook the computer up to a teletype (a kind of printer) or a television for a display, and input was accomplished by flipping switches.

Jobs imagined building a more useful product: a complete computing unit, consisting of a keyboard for input, a central processing unit for calculation, and a video screen for display. Wozniak was able to design such a unit. When Wozniak's Apple II was introduced in April 1977, it was a huge hit.

Disk drives

In the mid-1970s, minicomputers (as personal computers were then called) had little access to software. Such programming tools as BASIC were accessed in three ways: they were typed in, as on the early Apples; they were encoded onto a tape and read into the computer, as on the later Altairs; or they were encoded into a read-only-memory (ROM) chip on a circuit board. With BASIC as a programming tool, the usefulness of the computer was limited to a small group of specialists.

Wozniak changed this forever when he engineered a disk drive that allowed small computers to read and store large amounts of data from an outside source, allowing independent programmers to produce programs for the Apple. The computer became useful to nonprogrammers for the first time. Tens of thousands of ordinary people began to buy minicomputers and the programs that made them work.

The Macintosh

In 1979, Jobs oversaw the development of a radically new kind of personal computer. The first attempt, called the Lisa, sold for $10,000 when released in 1983—too high a price for most consumers. When the Macintosh was released in 1984, though, it brought personal computing to the masses with its easily understood graphics and point-and-click mouse. Rather than typing in complicated commands, users could simply click on an icon, or picture, on the screen.

Despite the great innovations, so much of Apple's money had been spent on development, the company began to falter financially. In 1985, both Jobs and Wozniak left Apple.

IBM comeback

In 1980, IBM hired Microsoft to develop a computer language and operating system for its new line of minicomputers, which were introduced to the public in 1981 as the IBM Personal Computer. The operating system used for the IBM-PC was called MS-DOS, short for Disk Operating System. It would become an international industry standard. Soon IBM began to create connections between personal computers and a larger mainframe computer. These computer networks were popular in businesses and other institutions. The entry of IBM changed the image of microcomputers from that of a hobbyist's toy to a serious business machine.

Microsoft takes the lead

Microsoft became the first major company to develop products for Apple's Macintosh when it was introduced to the public in 1984. In 1983, Microsoft introduced its first mouse, its first full-featured word processing program (Word), and Windows.

Windows extended the features of the MS-DOS operating system by providing users with a graphical user interface (GUI). The GUI was designed with visual icons that were easily recognizable. It was at least

partially based on the Apple interface used in the Lisa and Macintosh systems. In 1988, Apple sued Microsoft, claiming that Microsoft had infringed on the copyright of the Macintosh GUI. Years in court and a hostile rivalry between Apple and Microsoft followed. Despite the trouble, Windows, in its many updates, was a success and by 1986 thirty-one-year-old Gates was a billionaire.

During the late 1980s and 1990s, Microsoft released one popular new product after another, such as the spreadsheet program Excel for Windows; Windows 3.0; Encarta, the first multimedia encyclopedia designed for a computer; and Windows 95. Internet Explorer 2.0, released in 1995, provided easy Internet Web browsing on the home computer. In 1996, Microsoft acquired FrontPage, a tool for creating and managing Web pages without programming. And in July 1996, MSNBC, a twenty-four-hour news and information cable network, debuted as the result of a joint venture between Microsoft and NBC News. MSN, the Microsoft Network, was reorganized to offer content on the World Wide Web.

Microsoft monopoly trials

By 1991, Microsoft provided the operating systems for about 90 percent of the world's personal computers. The U.S. Federal Trade Commission (FTC) and then the U.S. Department of Justice opened investigations of Microsoft as a possible monopoly (a company that maintains an exclusive right to produce a particular product or service by unduly hampering its competition). To settle, Microsoft agreed to make it easier for personal computer makers to install its rivals’ software.

In October 1997, the Justice Department sued Microsoft for “bundling” its Internet browsing software, or providing Internet Explorer free of charge with its operating system. This supposedly violated the 1994 agreement by forcing PC manufacturers to use its Web browser. After extensive legal maneuvering, a trial began in October 1998. In June 2000, a federal judge ordered the breakup of Microsoft. A year later, the U.S. Court of Appeals upheld the judge's ruling that Microsoft was a monopoly but threw out the order to break up the company. The Justice Department reached a settlement with Microsoft whereby the company was prevented from making exclusive deals that could hurt competition and required the company to change several of its policies to compete more fairly.

The return of Apple

By mid-1997, Steve Jobs had returned to the financially weak Apple and was essentially running it again. To shore up the company, he formed a surprising alliance with archrival Microsoft. For $205 million, Microsoft received a 5 percent stake in Apple and an agreement to distribute its Internet Explorer Web browser with Apple's Macintosh computers. Soon, Apple was making great strides again.

In 1998, Apple introduced the popular iMac, a personal computer with a streamlined design and array of bright colors. A number of new products followed, some of which, like the iBook and PowerMac laptop computers, were extremely successful.

Jobs decided to tackle the digital music industry, which had been in a state of confusion after court rulings against “sharing” music files over the Internet (which bypassed the artists’ copyright privileges). In 2001, Apple launched its portable digital music player, the iPod. Comparable to MP3 players introduced by other companies, the iPod allowed users to download music from CDs or from online sites. In 2003, Jobs opened the iTunes Music Store. Customers could download any of the two hundred thousand songs for just ninety-nine cents each. In the first week, one million songs were downloaded, with the total exceeding fifty million after one year. By 2004, almost half of the digital music players bought by consumers were iPods.

In 2007, explaining that Apple was not just a computer company anymore, Jobs introduced the new iPhone, a lightweight mobile camera-phone that also featured a widescreen iPod multimedia player with touch controls and Internet communications including e-mail, searching, and Web browsing. Customers lined up at the Apple stores for the June launch, and sales met the high expectations. Apple once again took its seat at the top of the industry.

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Personal Computers

Personal Computers



By the late 1990s, personal computers (PCs) had found a place in millions of American homes. They were part of everyday life for office workers, as common as coffee cups and paper clips. Personal computers were used in all aspects of the media, in libraries, schools, and businesses of all kinds. Portable models had become a common sight on city streets, on public transport, and in cafes and bars. Yet barely twenty years earlier, PCs were available only to electronics hobbyists and the very rich. For most people in the 1970s, the personal computer was a device straight out of science fiction.

The PC revolution was made possible by the invention of the microprocessor—a computer chip that contains the entire central processing unit (CPU) of the computer. Before the late 1970s, computers were so large they had special rooms all to themselves. They needed a controlled climate and high levels of cleanliness to protect their sensitive electronics from dust and changes in temperature. Reducing complex electronic circuits to the size of a fingernail, microprocessors were robust enough to withstand normal working conditions and small enough to make computers more manageable in size. They were used in hand-held electronic calculators, wristwatches, and simple game machines. Microprocessors also became the key component in the PC.

Just who invented the PC is open to debate. Companies like IBM (see entry under 1980s—Commerce in volume 5), Apple Computer (see entry under 1970s—The Way We Lived in volume 4), and Xerox (see entry under 1960s—Commerce in volume 3) all have claimed to have done so. But the first PCs probably belonged to computer hobbyists. They bought electronic components and assembled the machines themselves. As the cost of microprocessors fell in the late 1970s, companies like Acorn, Apple, Atari (see entry under 1970s—Sports and Games in volume 4), and Tandy started to sell computers that were little more than ready-made hobbyist machines. Users had to be familiar with computer programming to make early PCs work. The machines had tiny amounts of memory by modern standards. A standard Tandy TRS-80 personal computer from 1980 had just eight thousand bytes (8K) of usable memory, with no hard disk. That is enough memory to hold just half a page of a basic word-processing document. Files and software were stored on a standard cassette tape.

The Apple II computer, released in 1977, was the best of the early PCs. It was the first to reach a mass market with speed and real computing power. But it was another seven years before the PC became accessible to users with no previous computing knowledge. In 1984, Apple's Macintosh computer had many of the features familiar on PCs in 2001. It was the first mass-market PC to use "drag and drop" icons, overlapping "windows," and a mouse. Known as Graphical User Interface (GUI), this system of opening files and running programs quickly became the standard.

Apple's major competitor in the early 1980s was IBM. Apple and IBM used different microprocessors, but although Apple computers were superior in terms of speed and computing power, other companies copied IBM's design. Before long, Hewlett Packard, Dell, and other computer makers began to swamp the market with PCs based on the IBM model. Running Windows software made by Microsoft (see entry under 1990s— Commerce in volume 5), these computers were cheap and used a GUI that was similar to Apple's. Both Apple and IBM had problems in the late 1980s, but the IBM platform became the standard for the desktop PC in the 1990s.

In the 1990s, major advances in the speed and efficiency of microprocessors changed the way PCs were used. In the 1980s, portable computers were the size and weight of a small well-packed suitcase. By 2001, "laptop" computers are small enough to fit in a briefcase and could be used in much the same way as a "desktop" PC. Smaller still, a fully functional handheld PC, complete with miniaturized keyboard and screen, will fit in the palm of a man's hand. Other handheld computers can recognize handwriting traced on a small screen. These pocket-sized PCs are sometimes known as personal digital assistants (PDAs). All these machines are much more powerful than the first PCs. Many exceed the capabilities of the huge "mainframe" computers of the 1960s and 1970s.

In its short life, the personal computer has grown from a hobbyist's toy into an essential everyday item. Once used mainly for word processing and data storage, the PC at the start of the twenty-first century is also a communication tool, a games machine, a sound and video system, and a place to store the family photographs. Since the advent of the World Wide Web, it has also become a shopping mall (see entry under 1950s—Commerce in volume 3), a reference library, and the first place to look for new recipes, cheap airline tickets, and classified advertisements. Personal computers have also made possible the growth in working at home and telecommuting. As new, smaller, more powerful PCs take on functions once performed by other machines, it is possible that the old-fashioned desktop PC will eventually disappear. The PCs of the late twentieth century changed forever the way we think about work and leisure.


—Chris Routledge


For More Information

"Computer History Collection." Smithsonian National Museum of American History.http://americanhistory.si.edu/csr/comphist (accessed April 1, 2002).

The Computer Museum History Center.http://www.computerhistory.org (accessed April 1, 2002).

Cringley, Robert X., writer; John Gau, producer. Triumph of the Nerds (video). New York: Ambrose Video Publishing, 1996.

Freiberger, Paul, and Michael Swaine. Fire in the Valley: The Making of the Personal Computer. New York: McGraw-Hill Professional Publishing, 1999.

Levy, Stephen. Insanely Great: The Life and Times of Macintosh, the Computer That Changed Everything. New York: Viking, 1994.

Malone, Michael S. The Microprocessor: A Biography. Santa Clara, CA: TELOS, 1995.

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