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  • 100 Years up for IBM: The rise, fall & rise of the BIG BLUE in India

    ibm completes a century 1911 to 2011
    GOOGLE, Apple and Facebook get all the attention. But what about the firm that invented bar-codes, computers that almost thinks like a human and even enables you to get money from an ATM? IBM — or International Business Machines — celebrates its 100th birthday today.

    If the aforementioned IT giants were celebrating such a milestone do you think it would pass so quietly? Not likely. Its much younger competitors owe a lot to Big Blue. After all, where would Groupon be without the bar code? Or Google without the mainframe computer?


    IBM dates back to June 16, 1911, when three firms that made scales, punch- clocks for work and other machines merged to form the Computing Tabulating Recording Co. The modern- day name came in 1924. With a plant in Endicott, New York, the business also made cheese slicers and — significantly — machines that read data stored on punch cards. By the 1930s, IBM’s cards were keeping track of 26 million Americans for the new Social Security program.

    history and timeline of ibm computers

    These old, sprawling machines might seem quaint in the iPod era but they had design elements similar to modern computers. They had places for data storage, math processing areas and output, says David A. Mindell, professor of the history of technology at the Massachusetts Institute of Technology. Punch cards carted from station to station represented what can be called ‘ data flow’ today.

    The RISE, fall & RISE of IBM in India

    THE story of IBM in India is surrounded by several myths and folklore, particularly relating to its infamous exit in 1978.

    George Fernandes, who was industry minister in the Janata government, is often credited for throwing out IBM over foreign exchange rules, but the trouble for IBM had started way back in 1967. It had a good run of the Indian market for two decades after its entry into India in 1951, facilitated by Jawaharlal Nehru himself.

    The real reason for IBM’s exit was a power struggle between a multinational firm and the government. With a market share of 80 per cent, IBM was able to dictate the industry’s growth rate in size as well as sophistication by deciding which products to market in India. The troubles for IBM began when the Electronics Committee, headed by Vikram Sarabhai, wanted it to end its business practice of bringing in old machines to India, refurbishing and leasing them out at inflated rates to government departments.

    IBM justified selling outmoded equipment saying it wanted India to grow step-by- step in computer technology. But the system of lease and maintenance followed by IBM resulted in a culture of dependence and hindered natural growth of engineering and programming skills among users.

    Once the department of electronics ( DoE) was formed, it wanted to be in the command of the situation. The parliamentary investigation into the functioning of IBM and ICL provided further ammunition against the two multinationals. The Foreign Exchange Regulation Act ( FERA) only came in handy to facilitate IBM’s exit.

    Culture defining role in India

    In the nearly 25 years that IBM operated in India in the first phase, it helped create a computer culture and pave the way for introduction of computers on a large scale.

    It created of a pool of highly trained computer professionals in systems engineering, programming and maintenance and IBM’s training programmes helped develop basic knowledge about programming.

    IBM’s journey back to India began soon after it left. It shut its operations in June 1978 and began exploring business with India in 1980. Ironically, CMC, which was set up to maintain IBM computers in India, became its first customer in this post- 1977 period. In 1986, IBM sent a proposal to DoE to set up a software development and training institute. In 1989, it supplied a major system to the Aeronautical Development Agency and by 1990 it was talking with DoE for a possible return to India in collaboration with the Tatas.

    It was back in operation in February 1992 as Tata Information Systems Ltd, which eventually became Tata IBM and finally IBM India in 1997. Today it is a full spectrum IT company in India and one of the largest employers in the private sector.

    Life has come full circle for the Big Blue in India.

    ibm bar codes, punh cards, factory

    Article credits: Mail Today
    Image credits: Reuters