In July of 1980, IBM representatives met for the first time with Microsoft's Bill Gates to talk about writing an operating system for IBM's new hush-hush "personal" computer. IBM had been observing the growing personal computer market for some time. They had already made one dismal attempt to crack the market with their IBM 5100.

At one point, IBM considered buying the fledgling game company Atari to commandeer Atari's early line of personal computers. However, IBM decided to stick with making their own personal computer line and developed a brand new operating system to go with. The secret plans were referred to as "Project Chess". The code name for the new computer was "Acorn". Twelve engineers, led by William C. Lowe, assembled in Boca Raton, Florida, to design and build the "Acorn".

On August 12, 1981, IBM released their new computer, re-named the IBM PC. The "PC" stood for "personal computer" making IBM responsible for popularizing the term "PC". The first IBM PC ran on a 4.77 MHz Intel 8088 microprocessor. The PC came equipped with 16 kilobytes of memory, expandable to 256k.

The PC came with one or two 160k floppy disk drives and an optional color monitor. The price tag started at $1,565, which would be nearly $4,000 today.What really made the IBM PC different from previous IBM computers was that it was the first one built from off the shelf parts (called open architecture) and marketed by outside distributors (Sears & Roebucks and Computerland).

The Intel chip was chosen because IBM had already obtained the rights to manufacture the Intel chips. IBM had used the Intel 8086 for use in its Displaywriter intelligen Typewriter in exchange for giving Intel the rights to IBM's Bubble Memory technology.

8 inch "floppy" disk with drive



5.25 inch "floppy" disk