ONE OF THE GREAT MISCALCULATIONS IN IBM HISTORY (May, 1980)

ONE OF THE GREAT MISCALCULATIONS IN IBM HISTORY

In the early 1950′s, we took a hard look at the future for business computer systems.

Our best estimate, at the time, was a potential of 50 new customers.

But in a relatively short time, we’d built and installed 75 systems. And by the time the dust had settled, we’d sold 1500 of them.

It’s hard to believe that a forecast could have been so wide of the mark.

But then, as now, this industry continues to surprise nearly everyone.

Who would have dreamed, back in the ’50s, that in less than 30 years this would be an industry that has installed more than 500,000 computer systems in the U .S. alone.

Who could have guessed that a business started by a few dozen scientists, inventors, and engineer would become a multibillion dollar industry employing more than three-quarters of a million people here in the United States.

For the past 30 years computer technology has been exploding, and even today demand continues to exceed the most optimistic forecasts.

There is one forecast, however, we feel confident in making.

As long as we can keep driving the cost of using a computer down, this looks like an industry with nowhere to go but up.

IBM

8 comments
  1. Rick Auricchio says: October 23, 20081:11 am

    Then there’s the famous quote from Ken Olsen, co-founder of Digital Equipment Corp (DEC), who in 1977 said “There is no reason for any individual to have a computer in his home.”

    This was a year after the Apple II came out…

  2. Firebrand38 says: October 23, 200812:24 pm

    Yeah he said that but the context has always been missing. He wasn’t talking abouit computers like the Apple II. See http://www.snopes.com/q…

  3. Rick Auricchio says: October 23, 200812:55 pm

    Thanks, Fire. I fell into the “out of context” trap all these years.

    So Olsen was referring to the Automated Home of the Future that we’ve seen here on the MM site. I don’t recall the title to search for it.

  4. Toronto says: October 23, 20083:27 pm

    What’s wrong with just having a teletype, a modem, and an acoustic coupler for your phone, and dialing into the PDP? Sheesh – kids these days. Next they’ll want ARPANet accesss.

    Anway, the context for this ad is that it was before the PCjr and OS2.

  5. Eliyahu says: October 24, 20087:07 pm

    IBM didn’t foresee the growth of the personal computer, either. But then, neither did anyone else, including the Sci-Fi writers who usually predict just about everything else…

  6. nlpnt says: October 24, 200810:11 pm

    At about this time the first PC probably WAS in pre-development…and someone at IBM decided that sincethey’d always made their money off hardware, they’d contract out the OS to a third party…

  7. Mike says: October 25, 20089:40 am

    nlpmt, by 1980 you could already buy expensive small home PCs. They didn’t do much but they were available.
    http://www.old-computer…

  8. teqjack says: October 25, 20081:59 pm

    The ad overstates a bit, I think the
    study was Sperry-Rand under government
    sponsorship not IBM, and concluded that
    only government would buy computers in
    the UNIVAC class. IBM looked at the
    study, figured a few businesses would buy,
    looked at some tech newer than included in
    the study…

    In re PC, IBM corporate did not think the
    then-small market would expand beyond a few
    enthusiasts (like HAM radio), even though they
    were already supplying hand-held computers
    equivalent to the best desktops in the
    commercial geek market to their hardware
    maintenance groups. A group of engineers
    in Boca Raton disagreed, designed one, and
    after a lot of to-and-fro the main company
    gave a limited go-ahead.

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