IBM

International Business Machines Corporation
Public
Traded as
ISINUS4592001014
Industry
FoundedJune 16, 1911; 107 years ago (1911-06-16) (as Computing-Tabulating-Recording Company)
Endicott, New York, U.S.[1]
FounderCharles Ranlett Flint
HeadquartersArmonk, New York, U.S.
Area served
177 countries[2]
Key people
Ginni Rometty
(Chairman, President and CEO)
ProductsSee IBM products
RevenueDecrease US$ 79.139 billion (2017)[3]
Decrease US$11.400 billion (2017)[3]
Decrease US$5.753 billion (2017)[3]
Total assetsIncrease US$125.35 billion (2017)[3]
Total equityDecrease US$17.594 billion (2017)[3]
Number of employees
380,300 (2017)[4]
Websitewww.ibm.com

International Business Machines Corporation (IBM) is an American multinational information technology company headquartered in Armonk, New York, United States, with operations in over 170 countries. The company began in 1911 as the Computing-Tabulating-Recording Company (CTR) and was renamed "International Business Machines" in 1924.

IBM manufactures and markets computer hardware, middleware and software, and provides hosting and consulting services in areas ranging from mainframe computers to nanotechnology. IBM is also a major research organization, holding the record for most U.S. patents generated by a business (as of 2018) for 25 consecutive years.[5] Inventions by IBM include the automated teller machine (ATM), the floppy disk, the hard disk drive, the magnetic stripe card, the relational database, the SQL programming language, the UPC barcode, and dynamic random-access memory (DRAM). The IBM mainframe, exemplified by the System/360, was the dominant computing platform during the 1960s and 1970s.

IBM has continually shifted its business mix by commoditizing markets focusing on higher-value, more profitable markets. This includes spinning off printer manufacturer Lexmark in 1991 and selling off its personal computer (ThinkPad/ThinkCentre) and x86-based server businesses to Lenovo (2005 and 2014, respectively), and acquiring companies such as PwC Consulting (2002), SPSS (2009), and The Weather Company (2016). Also in 2014, IBM announced that it would go "fabless", continuing to design semiconductors, but offloading manufacturing to GlobalFoundries.

Nicknamed Big Blue, IBM is one of 30 companies included in the Dow Jones Industrial Average and one of the world's largest employers, with (as of 2017) over 380,000 employees. Known as "IBMers", IBM employees have been awarded five Nobel Prizes, six Turing Awards, ten National Medals of Technology and five National Medals of Science.

History

In the 1880s, technologies emerged that would ultimately form the core of International Business Machines (IBM). Julius E. Pitrap patented the computing scale in 1885;[6] Alexander Dey invented the dial recorder (1888);[7] Herman Hollerith (1860-1929) patented the Electric Tabulating Machine;[8] and Willard Bundy invented a time clock to record a worker's arrival and departure time on a paper tape in 1889.[9] On June 16, 1911, their four companies were amalgamated in New York State by Charles Ranlett Flint forming a fifth company, the Computing-Tabulating-Recording Company (CTR) based in Endicott, New York.[1][10] The five companies had 1,300 employees and offices and plants in Endicott and Binghamton, New York; Dayton, Ohio; Detroit, Michigan; Washington, D.C.; and Toronto.

They manufactured machinery for sale and lease, ranging from commercial scales and industrial time recorders, meat and cheese slicers, to tabulators and punched cards. Thomas J. Watson, Sr., fired from the National Cash Register Company by John Henry Patterson, called on Flint and, in 1914, was offered a position at CTR.[11] Watson joined CTR as General Manager then, 11 months later, was made President when court cases relating to his time at NCR were resolved.[12] Having learned Patterson's pioneering business practices, Watson proceeded to put the stamp of NCR onto CTR's companies.[13] He implemented sales conventions, "generous sales incentives, a focus on customer service, an insistence on well-groomed, dark-suited salesmen and had an evangelical fervor for instilling company pride and loyalty in every worker".[14][15] His favorite slogan, "THINK", became a mantra for each company's employees.[14] During Watson's first four years, revenues reached $9 million and the company's operations expanded to Europe, South America, Asia and Australia.[14] Watson never liked the clumsy hyphenated name "Computing-Tabulating-Recording Company" and on February 14, 1924 chose to replace it with the more expansive title "International Business Machines".[16] By 1933 most of the subsidiaries had been merged into one company, IBM.[17]

NACA researchers using an IBM type 704 electronic data processing machine in 1957

In 1937, IBM's tabulating equipment enabled organizations to process unprecedented amounts of data, its clients including the U.S. Government, during its first effort to maintain the employment records for 26 million people pursuant to the Social Security Act,[18] and the tracking of persecuted groups by Hitler's Third Reich,[19][20] largely through the German subsidiary Dehomag.

In 1949, Thomas Watson, Sr., created IBM World Trade Corporation, a subsidiary of IBM focused on foreign operations.[21] In 1952, he stepped down after almost 40 years at the company helm, and his son Thomas Watson, Jr. was named president. In 1956, the company demonstrated the first practical example of artificial intelligence when Arthur L. Samuel of IBM's Poughkeepsie, New York, laboratory programmed an IBM 704 not merely to play checkers but "learn" from its own experience. In 1957, the FORTRAN scientific programming language was developed. In 1961, IBM developed the SABRE reservation system for American Airlines and introduced the highly successful Selectric typewriter. In 1963, IBM employees and computers helped NASA track the orbital flight of the Mercury astronauts. A year later, it moved its corporate headquarters from New York City to Armonk, New York. The latter half of the 1960s saw IBM continue its support of space exploration, participating in the 1965 Gemini flights, 1966 Saturn flights and 1969 lunar mission.

An IBM System/360 in use at the University of Michigan c. 1969.

On April 7, 1964, IBM announced the first computer system family, the IBM System/360. It spanned the complete range of commercial and scientific applications from large to small, allowing companies for the first time to upgrade to models with greater computing capability without having to rewrite their applications. It was followed by the IBM System/370 in 1970. Together the 360 and 370 made the IBM mainframe the dominant mainframe computer and the dominant computing platform in the industry throughout this period and into the early 1980s. They, and the operating systems that ran on them such as OS/VS1 and MVS, and the middleware built on top of those such as the CICS transaction processing monitor, had a near-monopoly-level hold on the computer industry and became almost synonymous with IBM products due to their marketshare.[22]

In 1974, IBM engineer George J. Laurer developed the Universal Product Code.[23] IBM and the World Bank first introduced financial swaps to the public in 1981 when they entered into a swap agreement.[24] The IBM PC, originally designated IBM 5150, was introduced in 1981, and it soon became an industry standard. In 1991, IBM sold printer manufacturer Lexmark.

In 1993, IBM posted a US$8 billion loss - at the time the biggest in American corporate history.[25] Lou Gerstner was hired as CEO from RJR Nabisco to turn the company around.[26] In 2002, IBM acquired PwC consulting, and in 2003 it initiated a project to redefine company values, hosting a three-day online discussion of key business issues with 50,000 employees. The result was three values: "Dedication to every client's success", "Innovation that matters—for our company and for the world", and "Trust and personal responsibility in all relationships".[27][28]

IBM inventions: (clockwise from top-left) the hard-disk drive, DRAM, the UPC bar code, and the magnetic stripe card

In 2005, the company sold its personal computer business to Chinese technology company Lenovo[29] and, in 2009, it acquired software company SPSS Inc. Later in 2009, IBM's Blue Gene supercomputing program was awarded the National Medal of Technology and Innovation by U.S. President Barack Obama. In 2011, IBM gained worldwide attention for its artificial intelligence program Watson, which was exhibited on Jeopardy! where it won against game-show champions Ken Jennings and Brad Rutter. The company also celebrated its 100th anniversary on the same year on June 16. In 2012, IBM announced it has agreed to buy Kenexa, and a year later it also acquired SoftLayer Technologies, a web hosting service, in a deal worth around $2 billion.[30]

In 2014, IBM announced it would sell its x86 server division to Lenovo for $2.1 billion.[31][better source needed] Also that year, IBM began announcing several major partnerships with other companies, including Apple Inc.,[32][33] Twitter,[34] Facebook,[35] Tencent,[36] Cisco,[37] UnderArmour,[38] Box,[39] Microsoft,[40] VMware,[41] CSC,[42] Macy's,[43] Sesame Workshop,[44] the parent company of Sesame Street, and Salesforce.com.[45]

In 2015, IBM announced two major acquisitions: Merge Healthcare for $1 billion[46] and all digital assets from The Weather Company, including Weather.com and the Weather Channel mobile app.[47][48] Also that year, IBMers created the film A Boy and His Atom, which was the first molecule movie to tell a story. In 2016, IBM acquired video conferencing service Ustream and formed a new cloud video unit.[49][50] In April 2016, it posted a 14-year low in quarterly sales.[51] The following month, Groupon sued IBM accusing it of patent infringement, two months after IBM accused Groupon of patent infringement in a separate lawsuit.[52]

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