This page looks at IBM, the US hardware, software and services giant that - for most of last century was considered by many to be the embodiment of information technology.

     introduction

What is now IBM began as a tabulator company, based on Hollerith's devices. Although particular components can trace their history back to the 1880s, the organisation had a recognisable form from 1911 when the Computing Tabulating Recording Company (CTR) - later renamed International Business Machines - was established through the merger of the Computing Scale Company and International Time Recording Company with Hollerith's Tabulating Machine Company.

For the first thirty years it gained much of its revenue from devices as prosaic as electronic scales and bundy clocks - technologies whose importance is discussed in works such as James Beninger's Control Revolution: Technological & Economic Origins of the Information Society (Cambridge: Harvard Uni Press 1989) and JoAnne Yates' Control Through Communication: The Rise of System In American Management (Baltimore: Johns Hopkins Uni Press 1993).

It leveraged global dominance (achieved through superior technology and business practices similar to those of Microsoft) in punch-card machines when it somewhat reluctantly entered the electronic computer market.

Several decades of outstanding success - highlighted in the figures here and in landmark antitrust action by the US government - were followed by managerial and financial crisis during the 1990s and the failure of offerings such as OS/2. After spinning off its printer arm as Lexmark in 1991 IBM increasingly promoted itself as a services business, acquiring Lotus (1995), Tivoli (US$743m in 1996), Unison (1997), Software Artistry (1998), Mylex and Sequent (1999), PwC Consulting for US$3.5bn and Rational Software for US$2.1bn in 2002.

As of 2001 the company had sales of around US$85,000 million, income of US$7,700 million and 319,000 employees. As of 2003 it was 8th on the Fortune 500 list of largest US companies, ranked by revenue.

IBM has manufacturing operations in the US, Canada, Mexico, Eire, Japan, France, China, the UK, India, Germany, Thailand, Hungary and Singapore. Major research facilities are located in the US, Israel, Japan, Switzerland, China and India: the company is one of the largest global owners and generators of patents. IBM is considered to be the world's largest business and technology services consultancy (US$35 billion), largest IT hardware company (US$33 billion) and the largest financing company in the IT industry worldwide (operating in more than 40 countries and with over US$40 billion in assets as of 2002).

IBM services revenue surpassed IBM hardware revenue for the first time in 2001.

Lotus was formed in 1982 by Mitch Kapor (subsequently a co-founder of the EFF) and enjoyed major success after release of its Lotus 1-2-3 spreadsheet product for personal computers, overtaking VisiCalc and having a greater market value than Microsoft.

At the end of the 1980s Microsoft bundled Excel, its spreadsheet product, with Word - emerging as the global industry standard. Lotus' market share dropped from 75% in 1988 to 55% in 1991 and declined further before the company was acquired by IBM in 1995 for its Lotus Notes groupware product.







   next page  (studies)