Compaq (original) (raw)

Compaq Computer Corporation was founded in February 1982 by Rod Canion, Jim Harris and Bill Murto, three senior managers from semiconductor manufacturer Texas Instruments. Each invested $1,000 to form the company. Their first venture capital came from Ben Rosen and Sevin-Rosen partners.

The first product was one of the first portable versions of an IBM PC compatible personal computer. Released in March 1983 at a price of US$3,590, this "luggable" suitcase-sized computer was the progenitor of the modern laptop. Although not the first portable computer, it was the first portable IBM-compatible PC--indeed, it was the first legal IBM-compatible PC, period--and it proved to be popular. The portable model featured a 9-inch monochrome screen and two 5 1/4 inch floppy disk drives and weighed approximately 45 pounds. Compaq sold 53,000 units in the first year and set revenue records for American businesses in its first three years of operation.

Compaq's efforts were possible because IBM had used mostly "off the shelf" parts for their PC, and because Microsoft had kept the right to license the operating system to other computer manufacturers. The only part which had to be copied was the BIOS, which Compaq did legally by reverse-engineering it at a cost of $1 million. Numerous other companies soon followed their lead.

Compaq further cemented its place of significance in the industry when, in 1987, they introduced the first PC based on Intel Corp's new 80386 microprocessor, the first 32-bit processor in the x86 line. By introducing a PC with a processor IBM had chosen, at the time, not to use, Compaq established what had been known disparagingly as the "PC clone" business as a force for innovation in the PC business.

Later in 1987, when IBM released its Microchannel-based IBM PS/2 line, Compaq was one of the leading supporters of EISA, an industry-standard challenger to IBM's proprietary architecture.

Compaq's early machines were known for the quality of their engineering and their documentation.

Compaq entered the retail computer market in the early 1990s with its Presario line, and was one of the first manufacturers in the mid-1990s to experiment with PCs at a retail price just below US$1,000. In order to maintain the price points it wanted, Compaq became the first first-tier computer manufacturer to utilize CPUs from AMD and Cyrix. The price war resulting from Compaq's actions ultimately drove numerous competitors, most notably IBM and Packard Bell, from the marketplace.

In 1998, Compaq acquired Digital Equipment Corporation, the leading company in the previous generation of computing during the 1970s and early 1980s.

In 2002, Compaq engaged in a bitterly contested merger with Hewlett-Packard. Numerous large HP shareholders, including Walter Hewlett, publicly opposed the deal. CEO Michael Capellas left the company soon after, leaving HP CEO Carly Fiorina in charge of the combined company. Many Compaq products were re-branded with the HP nameplate, while the Compaq brand remained on other product lines.

Two sports stadiums were named after the company. The Houston Compaq Center, of Houston, Texas, formerly The Summit, lost its sports teams to the Toyota Center. The building is expected to be converted for other use. The San Jose Compaq Center, of San Jose, California, was renamed the HP Pavillion.