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IBM and the system 360 decision Case on IBM (A) : The System/360 Decision The Industry There were nine competitors in the computer industry in the 60s, with GE and RCA withdraw from the field, due to the recession and corporate crises in 1970-72, the industry was left with seven U.S computer makers. The technology of the old computer has its limited compatibility. In the first generation of computers, there were about 2,000 components per cubic foot; the second generation uses transistors instead of tubes at 5,000 per cubic foot. The technology System/360 was to use a hybrid microcircuitry, involved 30,000 components per cubic foot. In 1963, IBM falls into competitor’s threats when its product line was running out of steam. Major customers were seeking ways of linking separate data-processing operations on a national basis, which is not found in IBM. Honeywell was ahead of the technology development where it offers a newer, faster, and cheaper transistors, with 30% price lower and it has the reprogramming capability. Some competitors think that the concern over the new system/360 is not to its challenge. In fact, during the process of launching system/360, G.E was awarded the business opportunity from MIT, when G.E an