Twenty-five years ago this week, IBM began selling its version of a new business tool called the PC, ushering in a new era of personal computing.
There had been other microcomputers sold on the market -- for example, Apple Computer put the Apple I on the market in 1976. However, IBM's brand name legitimized personal computers for corporate use and convinced many more programmers that a big, new market was in the making.
Early programmers rushed to create new applications such as the VisiCalc spreadsheet and the EasyWriter word processor, which gave PCs a foothold in corporate America. Once PCs were accepted by businesses as well as early enthusiasts, sales took off.
Since August 12, 1981, vendors have sold 1.6 billion personal computers, creating an industry with annual revenue of US$200 billion today, according to Gartner Inc.
The earliest machines offered 40K bytes of memory, a gross luxury for the rudimentary programs of the day. But operating systems, applications and databases soon grew to fill all available space, and engineers returned to their labs to improve the PC.
Now experts warn that the PC may begin to lose its central place in personal computing to wireless and mobile computing platforms unless it returns to its original strengths: simplicity and flexibility.
"My first PC was the Alto at Xerox Parc (Palo Alto Research Center) circa 1974," said Bob Metcalfe, the inventor of Ethernet and founder of 3Com Corp., in an e-mail interview. Metcalfe has also held various executive jobs with IDG and today is a general partner at Polaris Venture Partners.
"It had a bit-map display, fonts, windows, icons, WYSIWYG editor, mouse, removable hard disk (2M bytes), Ethernet (the first one at 2.94M bps), laser printer (the first, 500dpi, 1pps) and was connected to the Arpanet (Internet 1.0), but there was, alas, no World Wide Web and no Google."
To underline the power in connecting PCs to each other, Metcalfe formulated a theorem that said the value of a network is proportional to the square of the number of users.
The potential for sharing data was a catalyst for the PC's early growth. The first users had to be programmers to apply the machines to their business tasks.
Then Dan Bricklin helped to create VisiCalc, the first electronic spreadsheet and a predecessor to office tools like Lotus Development Corp.'s 1-2-3 spreadsheet and Microsoft Corp.'s Excel. Today he runs Software Garden Inc.
VisiCalc was one of the handful of programs designed to run on that first PC, which IBM sold for $1,565 if users connected it to their own cassette tape decks and television sets. A self-contained version cost $3,005, and a business version featuring two diskette drives and a printer cost $4,500.
If that sounds like high price tag in 1981 dollars, customers were reassured by the substantial weight of the machine. An IBM 5150 weighed 21 pounds, or 28 pounds including two disk drives to handle the 5.25-inch, 160K byte diskettes.
Those first PCs were powerful at the time because they were generic enough to handle any task. But 21st century PCs are increasingly specialized.
Bricklin today uses a Dell desktop at work, a Protege M400 tablet PC from Toshiba Inc. for mobile jobs and a PowerBook G4 from Apple Computer Inc. for video editing and software development.
This trend bodes poorly for the future of the traditional PC. PCs can hold their own at the hub of personal computing only if they retain the generic power to replace the typewriter, stereo, television, mailbox, telephone and bookshelf, Bricklin said. In contrast, the array of new mobile devices each serves for a narrow range of activities such as listening to music, talking while multitasking, keeping track of where we are and taking photographs.
But so far, PCs are holding their ground. "PCs are not for everything, but they are for an awful lot, and that repertoire is growing even as other devices proliferate," Bricklin said.
Indeed, the PC's greatest strength is its flexibility, said George Colony, founder and chief executive officer of Forrester Research Inc.
Forrester analysts produced their first report on a Wang PC that used MS-DOS. Twenty-five years later, Colony uses a Latitude D610 laptop from Dell Inc. despite a host of problems, including excessive weight, short battery life and the lack of a microphone (used for Voice over Internet Protocol telephone calls).
And he still complains about applications designed by the world's biggest software company. "It is filled with Microsoft software that I find slow, poorly design and unevolved after all these years," Colony said.
"The problem with the PC is that no software designer worth his or her salt designs for it anymore," Colony said. "The PC has become a wasteland for developers. Microsoft and Apple control their platforms, making it a loser's game to try to compete. The result is that the PC as an applications platform is dead."
Rubbing salt in users' wounds is the fact that their awkward software becomes obsolete faster than ever, said Robert Rosen, president of the IBM user group SHARE, and chief information officer of the National Institute of Arthritis and Musculoskeletal and Skin Diseases.
A customer buying a PC in 2006 must be certain that a new computer is ready to run Microsoft's often-delayed Vista OS and that it holds the latest processor, as Intel Corp. has accelerated its upgrade patterns from the leisurely progression from the 8088 (used in IBM's PC XT in 1983) and 80286 (used in the PC AT in 1984), to the modern rush from 486 to Pentium to Core 2 Duo.
For some users with modest needs, the rush to upgrade does not make sense.
"When is enough enough to do what you need to do?" Rosen said. "Gamers are still buying $7,000 PCs with souped-up processors, but ... you won't see any difference between processors if you're just Web browsing."
Indeed, PC designers may see the rug pulled from under their feet if the tremendous market growth begins to slow.
"Some say that everyone who's going to buy a PC has bought a PC," Rosen said, excluding the market niche for $100 PCs in developing nations. "So the tremendous growth curve is over. Companies might be on a three-year replacement cycle, but it's not clear that the typical home user is going to be on that schedule. Unless the machine breaks, it will work fine as his Web browser."
PC vendors need to clear that hurdle to keep selling PCs for another 25 years. In order to keep PCs at the forefront of personal computing, they must forge a new pattern of computer use, relying on technologies like reliable voice recognition, converged e-mail and voicemail and mobile platforms with wider utility than smartphones and the BlackBerry, he said.
Gartner analysts warn of a similar pitfall.
"The virtuous circle of innovation that drove the PC has become a 'vicious cycle' of increasing complexity. Simplicity and stability are key PC failings," said Gartner analyst Charles Smulders in a report titled "25th Anniversary Raises Questions About PC's Future Development."
"The growing availability of cheap, ubiquitous bandwidth and processing power, coupled with Internet-based services, makes possible a new style of application delivery. In the coming years, Gartner expects many new devices will challenge the PC."
After 25 years, the venerable personal computer faces its steepest challenge yet.