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Lord Acton’s epic warning that “Power tends to corrupt, and absolute power corrupts absolutely” was given more than 100 years ago, but it still has merit. It came to mind in reading an article on the 25-year anniversary of the PC this year. The article describes what the arrival of the PC meant to IBM. It is based on an interview the author, Tom Foremski, had with Irving Wladawsky-Berger, IBM’s top strategist. The author poses the question whether the industry standard technologies that resulted from the PC revolution were accidental because the computer industry historically always favoured proprietary technologies. What happened removed barriers to entry and allowed in much more competition.

He asked Mr Wladawsky-Berger why IBM chose off-the-shelf components and software for its IBM PC. This enabled an open industry platform that spawned a massive industry. Prior to that, proprietary computer systems were the way the computer industry made money, and lots of it.

The PC was a typical example of a disruptive technology. It disrupted the business models of huge sectors in the computing industry. Nearly all the minicomputer and mainframe companies were put out of business or disappeared through acquisitions. Even IBM barely survived - it had to reinvent itself as an IT services company.

Mr Wladawsky-Berger said, IBM used off-the-shelf technologies to create the PC platform precisely because it did not take the threat from the PC seriously. We dealt with big, complex computer systems, our management did not look to the PC as something that could seriously challenge our business.

The article then goes on to comment on the network comms business. The cell phone business sectors remain resolutely based on many competing technologies. Intel and Microsoft were not able to convince those industries to standardize on components and software in the same way as happened within the PC industry.

Indeed it is interesting to consider how far IBM’s dilemma about the PC parallels Microsoft’s dilemma about the Internet. Microsoft seems to be following the same approach as IBM did 25 years ago. Perhaps it’s the influence of new management. Perhaps it’s a response to the Anti-Trust actions. Microsoft is now vowing to play fair. It even has Twelve Tenets to Promote Competition for its Windows operating systems. Its Internet Explorer version 7 will support standards rather than going its own way.

IBM became a very different corporation in 25 years as a disruptive technology changed the ground rules. In their case, it was because their attention was elsewhere. Now Microsoft is choosing to promote competition. How different will Microsoft look in 25 years .. or even 5 years, given that we’re now measuring years on the Internet time scale?

Tags: disruptive technology, IBM, Microsoft

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This entry was posted on Friday, August 4th, 2006 at 7:35 am and is filed under Internet. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.