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The Rise Of The Clones
At first, the IBM PC didn't have much to offer home users and gamers. It was new, expensive, not as good with graphics as the Apple II or the Atari 800, and was directed squarely at business users. However, IBM's name on the machine made it a safe buy for businesses that already used IBM hardware, and they ended up buying the machines in droves. The machine's open design sparked a huge third-party expansion market, with dozens of vendors selling memory expansion boards, hard drive upgrades and more. It wasn't long until other computer makers started examining the PC's design and figuring out how to make clones of the machine that could run PC software without issues. The one thing stopping them, however, was the ROM. IBM had a copyright on what they called the "ROM BIOS", and while cloning the hardware was easy, cloning the ROM would be much harder, with few vendors able to get it completely right. It wasn't until Compaq introduced the Portable in 1983 that a truly 100% IBM compatible PC was available, and after that, software houses such as Phoenix and AMI followed suit, opening the floodgates to an entire industry of low-priced PC compatibles.
IBM also had another problem to deal with: Microsoft. When the PC was first being developed, IBM decided they wanted to license an outside OS rather than attempt to write their own, and their first choice would have been CP/M. However, when they tried to meet with Gary Kildall to license it, he wasn't around to sign the papers; the full details are unclear and have become something of a legend, but in the end, IBM didn't get CP/M. What they did get was the product of another little-known Seattle software developer's own frustration with CP/M: MS-DOS. MS-DOS began life as an admittedly "quick and dirty" clone of CP/M, written by a developer named Tim Patterson at Seattle Computer Products.
SCP was mostly a hardware outfit, whose business was in memory upgrades and other add-ons to the aforementioned S-100 machines. When the 8086 appeared on the market, they wanted to use it and quickly threw together a prototype machine. Digital Research had promised an 8086/8088 port of CP/M for a long time and never delivered until it was too late, leading Patterson to write his own and name it "86-DOS" or "Q-DOS" (depending on who you ask). Microsoft, who had already basically lied to IBM and said they had something ready (they did; it was called Xenix—but it was a UNIX OS, and IBM wouldn't accept that. Xenix was later sold to the SCO Group), paid SCP and Patterson $10,000 for the rights to 86-DOS, did some quick editing and released that as MS-DOS/PC-DOS 1.0. Microsoft also put language in their contract with IBM, stating that they had the right to license MS-DOS to whoever they wanted without first seeking IBM's approval. This had serious implications for the PC clone business, as it meant that once the clone makers, AMI and Phoenix had opened the floodgates on the hardware side, Microsoft could sell the hardware makers MS-DOS, thus creating a complete package — and a huge pain for IBM.
IBM Tries To Win Back The Crowd
With all of the pieces in place, the clone market took off like a shot after 1984. New companies building PCs based on cheap, mass-market "motherboards" made in factories in East Asia were popping up everywhere, and Compaq became a Fortune 500 company on the success of its Portable and Deskpro ranges. In 1986 Compaq beat IBM to the punch with the first PC to use the new, 32-bit 80386 processor. Between the clone armies and Compaq's meteoric rise, IBM decided that if it couldn't compete on price, it would compete on features, and (it was hoped) introduce a new standard that they alone would control.
The result was the Personal System/2 (or PS/2 for short), a line of new PC-based machines that were deliberately much different from the prevailing PC standards. The new machines used a new, IBM-proprietary expansion bus called "Micro Channel", which was faster than the AT's bus (by now referred to as "ISA" for "Industry Standard Architecture") but completely incompatible and protected by IBM patents, requiring anyone who wanted to use it to go through a lengthy licensing process and pay royalties. The other major feature the PS/2 line introduced was a new video subsystem called Video Graphics Array (VGA), a substantial upgrade to EGA that added a new 640×480 high-resolution mode (familiar now as the mode Windows 2000 and XP use for their splash screens), analog RGB video with an 18-bit palette (over 262,000 colors), and up to 256 colors on-screen at once. VGA was accepted by the rest of the industry enthusiastically, with 100% VGA compatibility becoming a must for video-card makers.
The VGA proved very popular with game developers. What it lacked in tricks like sprites, blitting and scanline DMA, it compensated for by being tweakable (hacked 256-color modes were very popular, providing resolutions up to 360×480) and having high-speed, easy-to-use video memory. The base 320×200x256 mode, however, was the easiest and the fastest*, and many groundbreaking games of the late 1980s and early 1990s were written with this mode in mind, including the Sierra and Lucas Arts point-and-click adventures, Wolfenstein 3 D and Doom. 640x480x16 mode, on the other hand, was extremely popular with the early graphical OSes and GUI-based DOS software, and it remains a barebone compatibility video mode in many modern OSes as well. Later IBM innovations, like 1024x768x16 XGA, were a few more-or-less standard modes in the swirling chaos generally known as "Super VGA".
Local Bus Wars
Micro Channel didn't fare so well, though. Only a handful of other PC makers (notably Tandy) adopted the bus, and while a few outside peripheral makers made MCA-compatible devices, the vast majority were designed and built by IBM as build-to-order add-ons. Miffed at IBM's rather shameless attempt to corner the high-end PC market, Compaq and several other PC makers introduced a competing standard called "extended ISA" or just EISA for short. EISA expanded the bus to 32 bits and added "bus mastering" support (which let the CPU do other things while a data transfer from, say, a disk was happening) and MCA-style, semi-automatic configuration, while maintaining compatibility with regular ISA cards. EISA was popular mainly on servers and high-end PCs; desktops didn't need that kind of bandwidth yet. Its auto-configuration system was later backported to ISA as "Plug and Play", as part of the development effort leading up to Windows 95.
In the mid-1990s there was another competitor bus, VESA Local Bus (or VLB for short), which added a 32-bit wide, full-speed side channel to the ISA bus. VLB was originally designed to give bandwidth-hungry GPUs a faster connection to the system bus, but it was also something of a stopgap measure and didn't last long. Its biggest problem was that it was too deeply connected to the internals of the 486 processor, for which it was developed; the Pentium used a completely different memory bus setup, and converting between the two was notoriously difficult. Also, VLB's specification was not very rigid and almost all manufacturers tweaked it a bit. This lack of precision also made running anything other than video on VLB a potentially dangerous proposition, especially if mass storage was involved; most IDE controllers of the day generated their timing signals directly from the VLB, and if it was running faster than what the controller expected, bad things would happen.
VLB also had severe mechanical problems. Physically, it was an inverted PCI connector positioned next to an ISA-16 slot, so it could be used with full-length cards only (giving it a Fan Nickname of Very Long Bus) and, due to the large number of pins and friction in them, it required enormous force to physically install or remove a card, dangerously flexing the motherboard. This was exacerbated by the fact that due to the cards' extreme length, many cases (in which such cards barely fit) made it impossible to angle the card into the slot, making it necessary to force them straight. In the end, Intel's new "Peripheral Component Interconnect" (PCI) spec won the "local-bus wars" due to its platform-agnostic nature and cleaner architecture. PCI was first announced in 1992, and became popular with the first PCI 2.0 machines in 1995, making VLB obsolete almost immediately.
Wintel Comes And Wins
After years of being confined to what were basically fleet sales, IBM discontinued the PS/2 line and MCA in the mid-1990s, preferring instead to concentrate on the revived "IBM PC" brand (new, ISA/PCI-based machines sold as business desktops) and the highly successful ThinkPad line of notebooks, which was introduced in 1992. This marked the end of IBM's dominance of the PC clone market, with the balance of power now shifted to Microsoft, Intel and the clonemakers
The introduction of Windows 3.0 in 1990 also finally made Windows a legitimate platform after several years of false starts; it placed higher demands on both graphics hardware and Mass Storage, and it was this need for better hardware that drove PC development. With the introduction of PCI between 1993 and 1995, along with improved video, sound and storage hardware, the PC started to look less like a classic 8-bit computer with bolted-on upgrades and more like a high-end RISC workstation. The introduction of the second-wave Pentium in 1995 and the Pentium II and AMD K6 in 1997, along with the ACPI API in 1998, blurred the distinctions even further, and convinced people that a cheap desktop could perform as well as an expensive UNIX workstation. AMD sweetened the deal further in 1999 with the announcement of the "x86-64" instruction set, which added 64-bit capability to the PC as well as fixing some of the 80x86's long-standing quirks; the first CPU to feature it was the Opteron, released in 2003.
This caught Intel in a bad spot. Intel had been working with Hewlett-Packard on a new, 64-bit processor called "Itanium", and had pretty much bet the company on it, with grandiose plans to move the entire PC platform over by the mid-2000s. The Itanium was not a regular CPU. It used a new architecture based on "very long instruction words", small programs in themselves that ran the CPU's insides more-or-less directly instead of relying on a decoder system to do it. Between the chip itself being late to market and the issues developers had with writing the development tools for it, most people simply ignored it; it was often referred to as "Itanic" since it seemed to be sinking fast. Despite all this, Intel stood by Itanium right up until the Opteron came out — and then changed their minds quickly upon seeing how popular it had become, working on plans to add 64-bit support to the Pentium 4 line as well as the then upcoming Core 2 processors. Since then, the Itanium has found a niche in replacing older RISC systems like DEC's Alpha, and HP's PA-RISC, and the Itanium 2 has found use in high-performance computing, but it never had the mass-market success Intel was hoping for.
Today, in early 2011, the PC's various implementations are collectively the most popular desktop computer in the world, and have even made inroads into scientific and high-performance computing due to huge leaps in processing capability as well as an emphasis on power savings. Several attempts to update the PC using newer parts have come and gone; most of them failed after 1995 as the PC's hardware ended up absorbing most of the features that a switch to MIPS or PowerPC would have brought, including (eventually) the RISC philosophy itself. The Pentium Pro and its descendants are actually RISC processors internally, and use emulation to handle the rather haphazard x86 ISA instead of trying to execute it directly, as all processors up to the Pentium had.
On top of all this, the rise of the clones meant that pretty much everyone was selling nearly identical systems with little to differentiate them; this made margins even tighter and made PC makers more reliant on advertising, system aesthetics (the aforementioned ThinkPad was one of the first PCs to buck the trend of the generic beige box), gimmicks such as "100x CD-ROM" software and other pack-ins, and, if all else failed, price. This environment made it much more difficult for a new player to enter, as any new system would almost certainly be more expensive than a regular PC would and would have the additional hassles of porting all the software. Apple was able to stick it out due to both clever advertising and innovative system design, but they, too, eventually switched to x86 in 2006.
So far, x86 has seen off all attempts to replace it, with most of its challengers either long obsolete (6502, 68000) or relegated to embedded systems (MIPS, PowerPC). However, ARM CPUs have seen massive increases in computing power since the mid-2000s, and may end up being the first real challenge to x86's dominance on the desktop in decades. Chips based on the ARM architecture have dominated consumer electronics for years because of their clean system design and low power usage (which means better battery life), whereas Intel has had to cut features and performance from the Atom just to get it cool enough for netbooks. Chips from NVIDIA, Texas Instruments, Samsung and Apple have shown what ARM is capable of, and with many people switching from desktops and laptops to tablets, even Microsoft has gotten concerned — Windows 8 will be the first version of Windows to run natively on ARM. There's also rumors that Apple may be considering switching their desktop machines to ARM.
As a footnote, IBM themselves left the personal computer business for good in 2005, selling their PC division to a Chinese company named Lenovo (hence Lenovo now sells the Thinkpad).
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