Wilson da Silva

Science journalist, feature writer and editor.

Nov 12, 1996
Published on: The Age
3 min read
The Intel 4004 microprocessor – the chiip that began it all

The microchip that spawned the personal computer revolution is 25 years old this week. And the revolution isn’t over yet.

By Wilson da Silva

THE world changed forever on November 15, 1971. And hardly anyone noticed. Watergate was still seven months away. Britain had just voted to join the European Union, John Newcombe and Evonne Goolagong had won at Wimbledon and Columbo debuted on television. The biggest news of that day was the readmission of China to the United Nations.

Yet on that morning 25 years ago, a small start-up company in California known as Intel, barely three years old, put out a press release that signalled the dawn of the Digital Age. “Announcing a new era in integrated electronics,” it said breathlessly, as press releases often do. And for once, it was an understatement. 

The product launched was the Intel 4004, the first general-purpose “microprocessor”. It was an innocuous sliver of silicon in a dark metal casing and fat metal electrodes for legs, looking all the world like a headless electronic cockroach. With 2,300 transistors, it could process what must have seemed like an astounding 60,000 instructions a second. In today’s tech-talk, it was a 4-bit microprocessor with an operating speed of 100,000 cycles, or 0.1 megahertz (MHz). It cost $US200 ($253) or, in today’s terms, $US3,330 per MIPS (million instructions per second).

That modest chip represented a revolution so powerful it would sweep the world and eventually re-shape it.

In 1971, offices were filled with paper: order books and invoice folders, carbon copies and suspender files, forms in triplicate, memos written by hand, and desks populated with rubber stamps and typewriter ribbons. Armies of busy clerks swarmed around the paper mountains: sorting, marking, stamping, filing. Today, the office is a more contemplative place, broken only by the gentle hum of computers and the click-clack of keyboards; the army of clerks has been replaced by a platoon of skilled information workers.

Today, that little-known company in Santa Clara, California, is the world’s largest manufacturer of microprocessors, with 42,000 employees and annual revenue of $US16.2 billion.

Intel’s latest chips, the Pentium and Pentium Pro, all trace their lineage back to the 4004. The high-end Pentium Pro chip has 5.5 million transistors, a clock speed of up to 200 MHz, and can process 381 million instructions per second. Within the span of a human generation, the clock speed and the number of transistors that can fit on a microchip have soared more than 2,000 per cent. Meanwhile, the number of instructions per second a chip can handle has risen 6.35 million per cent.

“None of us thought it was going to be this big,” said Albert Yu, senior vice-president at Intel. “We thought it would be substantial. We thought it had potential. But we had no idea it would go this far.”

From left, Federico Faggin, Ted Hoff and Stanley Mazor holding Intel 4004 processors at the National Inventors Hall of Fame

When the 4004 chip hit the market, IBM was making big, heavy, room-crowding mainframe computers with magnetic tapes and metal desks where operators flicked switches or fed perforated paper punch cards into slots. The arrival of the 4004 made hardly a wave: the reaction from industry to Intel’s innovation was largely, “So what?”

Some did take an interest. It became obvious that the complex mathematical calculations performed on slide rules, which had propelled men to the moon in Apollo 11 only two years earlier, could be performed flawlessly and instantaneously using the silicon chip. Soon, the first programmable electronic calculators were born, as were electronic cash registers, traffic-light controllers that could sense approaching cars, and digital scales.

In 1969, Intel engineers Ted Hoff and Federico Faggin created a CPU, or central processing unit, the heart of today’s personal computers, for Busicom, a Japanese client.

Both Hoff and Faggin quickly realised the chip’s potential: that single $US200 microprocessor could perform what only two decades before had taken 18,000 vacuum tubes, and 85 cubic metres of machinery weighing 30 tonnes, to achieve.

Hoff tried to convince Intel to buy the chip back from the Japanese, who under the contract owned the intellectual rights.

In 1971 Intel offered to return Busicom’s $US60,000 investment in exchange for the rights to the chip. Busicom, struggling financially at the time, accepted the offer. Few realised that it might well prove to be the deal of the century.

After the birth of the Intel 4004, nothing much happened at first. In the year that followed, more US astronauts walked on the moon from Apollo 16, Polaroid launched its SX-70 instant colour camera, Tom Kenneally published The Chant of Jimmie Blacksmith, Richard Nixon re-captured the White House and Gough Whitlam took the Lodge.

That same year, 1972, Intel launched the 8008 chip an eight-bit microprocessor with 16,000 bytes, or 16KB, of memory. It could process 300,000 instructions a second, five times more than the year before.

It was a confirmation of “Moore’s Law”. In 1965, before founding Intel, Gordon Moore had stated that the number of transistors that could be crammed into a chip would probably double every 18 months, generating a huge increase in power and a rapid decrease in cost.

Also in 1972, Atari was founded by Nolan Bushnell, and Pong, the world’s first video game, a black-and-white, tennis-like contest, was released commercially. 1972 was also the year two young and ambitious computer aficionados, Paul Allen and Bill Gates, seized on the Intel 8008 and developed a traffic-flow recording system, creating a company called Traf-O-Data, and the Chicago-based radio and communications company Motorola launched its own microprocessor, the 6800, an eight-bit chip with 4000 transistors and a five-volt power supply.

But it took two computer enthusiasts in Albuquerque to really set computing on fire. Working under the grandiose name of Micro Instrumentation and Telemetry Systems (MITS), and saddled with debts of $US365,000, Ed Roberts and Forest Mims launched the Altair 8800, a ready-to-assemble computer based on the new Intel chip. Selling for a rock-bottom $US489, it made the cover of Popular Electronics in January, 1975, and set off an avalanche of orders.

MITS received 400 orders in one afternoon. Within three weeks, it had a $US250,000 backlog of orders. At a time when there were less than 40,000 computers in the world, the Altair, named after a planet in an episode of Star Trek, sold 2000. It was the first machine to be called a “personal computer”, although it was just a box with lights and toggle switches. If you wanted a keyboard, monitor or magnetic tape drive, you had to buy expansion cards.

Nevertheless, the Altair sparked much interest. Allen and Gates ditched development of Traf-O-Data and approached MITS, offering to write an operating system for the Altair. The duo called themselves “Micro-Soft”, a business name they did not formalise (dropping the hyphen) until the following year. At established firms like Xerox and Digital, engineers broke new ground in personal computer design but management could not see the potential and scuttled the projects.

That all changed in December 1976, when Steve Wozniak and Steve Jobs displayed to a Californian computer enthusiasts’ club a prototype of the Apple II. The commercial version of the ready-to-use Apple II, amazingly complete for the time with sound and graphics, was launched the following year.

Steve Wozniak with the Apple II

By the end of 1977, the Commodore PET and the Tandy TRS-80 had also entered the fray. Apple developed a floppy disk drive, and then a PC printer. Word processing and games were the major applications. It was not until 1979, with the launch of an accounting spreadsheet program called VisiCalc for the Apple II, that the world really took notice of personal computers.

By 1980, the personal computer industry was becoming too big to ignore. IBM, scared into the market, created a crack unit of engineers in August, 1980, to develop its own personal computer, a project codenamed “Acorn”.

With no time to develop a chip, Big Blue went to Intel, which set about configuring its new 8088 chip for IBM. IBM also asked the fledgling Seattle computer company, Microsoft, to write one, impressed by the young Bill Gates and his pioneering work with Paul Allen in developing a system for the Altair 8080 years before.

When the IBM PC was launched in August 1981, it single-handedly legitimised the personal computer as a serious tool. Relying on a 4.77 MHz Intel 8088 chip, and with only 64KB RAM memory and a single floppy drive, it went on sale for a pricey $US3000. With the marketing muscle of IBM and the stamp of business approval it brought, Intel and Microsoft were guaranteed a future.

Just as suddenly, personal computers made by Apple, Commodore and Tandy, and newcomers like Sinclair, gained instant respect.

Within a year, others were on the scene, or had crash programs to get in Compaq, Texas Instruments, Epson, Atari, Amiga, Osborne, Olivetti, Hewlett-Packard, Toshiba, Zenith.

By the end of 1981, about 900,000 computers had been shipped worldwide and Apple became the first PC company to reach $US1 billion in annual sales.

Application programs like dBase and Lotus 1-2-3 flooded the market and, at the end of 1982, a further 1.4 million personal computers were shipped.

By January, 1983, the revolution was so apparent that Time magazine named the personal computer “Man of the Year”. Certainly no-one would have imagined that Intel’s first modest silicon chip would spawn, 25 years later, a tidal wave of more than 200 million personal computers that would populate offices and homes around the world. Nor could they predict that, at the close of the century, more PCs would be manufactured than cars or televisions.

Intel and Motorola, too, have had their anxious moments with product lines that failed to catch fire.

Some years ago, Intel chief executive Andy Grove coined a phrase that has become the unofficial motto of the personal computer industry: “Only the paranoid survive.”

Yet there’s more ahead. “ ‘Moore’s Law looks like it’s going to continue,” said Albert Yu. “I certainly don’t see any physical limits . . . looking out to the next 10 years or so.

“Today, there’s close to 6 million transistors on a Pentium Pro chip. If you draw a straight line, you can imagine anywhere from 300 to 400 million transistors 10 years out.

“Just imagine the kind of power that will be available by that time.”


  • 1968 Intel, founded by Robert Noyce (the inventor of the integrated circuit), Gordon Moore and Andy Grove, all from Fairchild Semiconductor.
  • 1970 Intel launches the 1103, the first widely available RAM (random access memory) chip. It stores 1K (1024 bits) of information.
  • 1971 Intel offers the 4-bit 0.1MHz 4004 microprocessor, the first “computer on a chip”, for $300. The Poketronic, probably the first battery-powered pocket calculator, is launched in the US.
  • 1973 Sinclair Cambridge pocket calculator launched in the UK at 29.95 ($60) plus value added tax.
  • 1974 Intel announces the 8-bit 8080 microprocessor at $360. It has 5000 transistors. Frederico Faggin, who has designed all Intel’s microprocessors so far, leaves to found Zilog, where he designs the Z80. This has sold more than a billion units, and is still selling about 40 million a year.
  • 1975 The first 8-bit personal computer, the MITS Altair, is a construction kit based on Intel’s 8080 microprocessor. Bill Gates and Paul Allen write a version of Basic for it, and found Microsoft. Three important 8-bit processors are unveiled, the Zilog Z80 (used later in the Tandy TRS-80, Sinclair and Amstrad PCs), MOS Technology’s 6502 (used later in the Apple II, Commodore PET, Acorn BBC B, Commodore 64) and Motorola 6800 series. The 6502 costs only $25.
  • 1978 Intel announces the 16-bit 8086, founding the x86 dynasty. It has 29,000 transistors and runs at up to 10MHz. Texas Instruments launches Speak and Spell, the first electronic toy with digital speech synthesis.
  • 1979 Intel introduces 8088 microprocessor, a cheaper version of the 8086. Acorn offers the System 1 microcomputer kit in the UK at 65 ($130) plus VAT.
  • 1980 Motorola releases the 8MHz 68000, the first microprocessor with 32-bit registers. Sinclair launches the ZX-80, a kit computer for less than 100 ($200) In Britain, the first System X microprocessor-controlled digital telephone exchange is installed. Atari’s Pac-Man sweeps the pubs and games arcades.
  • 1981 IBM launches the IBM PC, based on a 4.77MHz Intel 8088. Monthly production of the Sinclair ZX-81 hits 50,000.
  • 1982 Intel unveils the 16-bit 80286 processor, which has 130,000 transistors and runs at speeds of up to 12MHz. Sinclair Research launches a new home computer, the Spectrum. Inmos, a UK company, is developing a promising microprocessor, the Transputer.
  • 1984 IBM launches the IBM PC AT, based on a 6MHz Intel 80286. Apple launches the Macintosh based on the rival Motorola 68000 chip; Sinclair announces the QL (Quantum Leap), based on the 68008.
  • 1985 Intel announces the 32-bit 20MHz 80386 processor at $299, and sues Japan’s NEC over the x86-compatible NEC V20 and V30 processors. The 386 has 275,000 transistors, and is the first processor Intel will not allow other firms (except IBM) to manufacture under licence. Atari ST and Commodore Amiga launched: both use the Motorola 68000, as will the later Sega MegaDrive games console.
  • 1986 Compaq brings out the Deskpro 386, the first popular 386-based IBM-compatible, without waiting for IBM. Amstrad dominates the UK market with the first cheap PC clone, the PC-1512, at 399 ($800) plus VAT. Intel makes its sixth straight quarterly loss; annual sales are now worth $1.3 billion.
  • 1987 Acorn launches the Archimedes, the first mass-market computer based on a Risc (Reduced Instruction Set Computer) chip.
  • 1989 Intel announces the 25MHz 80486 processor, which combines a 386, a maths co-processor, cache memory and memory management on one huge die. It has 1.2 million transistors. Annual turnover hits $3 billion.
  • 1990 Intel co-founder Robert Noyce dies aged 62.
  • 1991 Cyrix launches 486-compatible chips to compete with Intel. IBM, Apple and Motorola form a consortium to back PowerPC processor.
  • 1993 Intel introduces 60 and 66MHz Pentiums with 3.1 million transistors. The Pentium is not called the 586 because a number cannot be trademarked.
  • 1994 Intel and Hewlett-Packard agree to co-develop the next generation of processors, codenamed Merced, the equivalent of the 786. Intel suffers bad publicity after the discovery of a bug in the Pentium’s maths routines.
  • 1995 Intel launches the Pentium Pro, which runs at 150 to 200MHz and has 5.5 million transistors. Intel’s annual turnover reaches $16 billion.
  • 2000 Microprocessors are expected to have 50 million transistors and run at 500MHz.