IBM's Triple Play

Andy Schram started working at IBM in the late 1970s, when the digital future was still in diapers. Personal computers were primitive affairs with four kilobytes of memory and now-forgotten names like Tandy and Commodore. Home video games were played on clunky TV-top consoles made by Atari and Magnavox. The Internet? Still primarily the Department of Defense’s baby.

“When I started, computers were something that only businesses had,” says Schram, now an IBM project executive. “They weren’t even in schools.”

But the caveman ’70s also saw the introduction of the microprocessor—a single chip first manufactured by Intel with all the circuitry, programmability, and memory that used to fill large cabinets. The ever-increasing speed and storage capacity of these chips was an express route to the tech-happy 21st century, and to the incredible rise of video game consoles, whose sales totaled $18 billion in the United States last year.

The introduction during the past three years of next-generation game consoles from the three dominant makers—Microsoft’s Xbox 360, Nintendo’s Wii, and Sony’s PlayStation 3—has been one big reason for the explosion in sales. And a central component of those new systems is microprocessors developed by IBM, with much of the design and execution taking place just 75 miles southeast of the Twin Cities, at the company’s Rochester campus. All three systems contain core technology developed at least in part in Rochester; in the case of the Xbox 360, half of the nearly 500 IBM engineers who did the heavy lifting are based there.

“For us to be working on three gaming machines, that was the biggest thing around,” Schram says. “At that time, you couldn’t have picked a better engineering job in the world.”

And since then? IBM is finding that its gaming technology plays well in other industries, too.

A New Approach to Engineering

Big Blue’s first step into gaming was in 1999, when the company’s Vermont campus developed the microprocessors used in Nintendo’s GameCube. But a masterstroke came in 2002, when IBM-Rochester engineer Charlie Johnson flew to Microsoft headquarters in Redmond, Washington, and evangelized about a newly formed research group in Rochester, Engineering and Technology Services.

Microsoft’s Xbox at that point contained a processor built by Silicon Valley giant Intel. For its new Xbox 360, Microsoft was considering licensing microprocessors that IBM had made for other projects and having them retrofit for the game console.