Santa Clara Valley Historical Association

In 1981, International Business Machines Corp. entered the personal computer market, and was welcomed as a competitor, rather slyly, by Apple. IBM's PC boasted a disk operating system that became an industry standard. Hewlett-Packard had launched its first PC in 1980. The early '80s were to be dominated by microcomputer expansions -- and by a torrid pace of start-ups.

Steadily improving microprocessors triggered a related explosion of other peripherals: printers, modems, disk drives, interlinked networks, equipment for building chips, video games, computer-assisted design. The games business reached its zenith in 1981 and by 1983 was plummeting.

The race to gain share in the expanding PC market created a profusion of new models, some of them tardy though much ballyhooed -- a phenomenon scornfully called "vaporware." In 1983, IBM introduced its PC-XT, the first personal computer with a built-in (10-megabit) hard drive. Meanwhile, Compaq marketed a "clone" of an IBM PC, starting production of a flood of IBM compatibles by rivals trying to improve on and/or undersell the industry standard-bearer.

Apple offered an expensive model called the Lisa in 1983, and it flopped. Recovering in 1984, Apple introduced the Macintosh to instant popularity. The Mac made affordable innovations that had been part of the Lisa, such as pull-down menus and the mouse as an alternative to moving the cursor with keystrokes. The Mac's special graphics capabilities endeared it to illustrators and designers.

Computer-assisted design (CAD) took off after invention of the silicon compiler in 1979. Former Stanford professor James N. Clark founded Silicon Graphics in 1982 to develop three-dimensional computer graphics and marketed the first 3-D work station in 1984. Edward McCracken later replaced Clark as Silicon Graphics CEO.

Another 1982 start-up was Sun Microsystems, also born in a Stanford laboratory. Sun founders Andreas Bechtolsheim, Scott McNealy, and Vinod Khosla, abetted by Stanford professor Forest Baskett, saw potential for workstations able to share data using the UNIX operating system favored by scientists and engineers. McNealy became the CEO.

Daisywheel and dot-matrix printers, the early choices, began to give way in 1984 when Hewlett-Packard pioneered inkjet technology.

John Warnock and Charles Geschke led a group of former Xerox PARC scientists in founding Adobe Systems in 1982. They aimed to develop a standard computer language that would consistently transmit even the most complex pages to a printer. Their scalable-font software product, PostScript, eventually became the industry standard.

Another 1982 start-up, Cypress Semiconductor, began when a group of CMOS (complementary metal oxide semiconductor) engineers led by T.J. Rodgers deemed Advanced Micro Devices too slow to adopt that technology and programmable gate arrays. CMOS, as the Japanese had learned, proved to be a "slow and low" (low-powered) answer for small battery-driven electronic devices such as notebook computers, and Cypress found a niche at the high end of the customized chip market.

Xilinx entered the customizing arena in 1984 to create field-programmable gate arrays, enabling buyers to customize computer instructions to fit their own needs. Bernie Vonderschmitt, Ross Freeman, and Jim Barnett, former Zilog employees, were its founders.

Another 1984 start-up was Cisco Systems, founded by a husband-and-wife team, Leonard Bosack and Sandra Lerner. Cisco used technology Bosack had developed to link Stanford computers so he and his bride-to-be could communicate, though in separate departments. Later in the '80s, when the market for network routers opened up, Cisco was ready.

Cirrus Logic also made its debut in 1984, adapting an efficient chip developed by Suhas Patil to the first controllers built directly on a disk drive. This led to the PC industry's shift to smaller disk drives. Sybase Inc. entered the high-performance relational database management field in 1984 in competition with Oracle Systems and became a significant player in the 1990s.

Although U.S. firms had controlled the semiconductor memory market throughout the 1970s, 1984 brought a startling reversal as Japanese producers moved into an early lead and went on to capture all of the 256K DRAM market, thus dominating the latest development. Wails that Silicon Valley had lost its edge began to make headlines.

Stanford professor Henry Taube won the 1983 Nobel Prize for Chemistry for new discoveries in the basic mechanism of chemical reactions. One application of his findings has been in selecting metallic compounds for use as superconductors.

The U.S. space shuttle grabbed the manned-flight spotlight, with Columbia beginning operational missions late in 1982. Challenger first flew in 1983, Discovery in 1984.

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