It was quite a year.
IBM announced a drastic restructuring of its computer hardware business, abandoned the personal computer software applications business and teamed up with Apple to develop workstations of the future.
Apple, meanwhile, finally got real with its prices and introduced some great new machines.
Microsoft, which was adopted by IBM as a toddler, reached adolescence, rebelled and struck out on its own, confident that it now rules the personal computing world. It may be right.
And Compaq finally figured out what would-be customers have known for three years, fired its president and set out in a new direction.
There are a lot of lessons in all of this.
IBM is in trouble because of its peculiar genius for losing new business while doggedly trying to preserve old business. Put another way, it has refused to compete with itself, leaving that to others, who have made billions gleefully accepting the opportunity.
For instance, the PC that IBM introduced in 1981 was the natural successor to its expensive DisplayWriter word processing system. Instead of taking advantage of the new technology, IBM crippled the original PC with a lousy keyboard and minuscule memory.
So today it is WordPerfect and Microsoft that rule word processing, and DisplayWriters are dead, so dead you can't even give them away.
If we are lucky, the brilliance of IBM, which is in its scientists and engineers, will be able to flourish under the new structure and they will be allowed to actually market what they invent without worrying about making existing products obsolete.
One need only look at Apple to see the advantage of giving free rein to the best and brightest stars in a company. The Macintosh has a personality that IBM and compatible computers lack. It will be Apple's challenge to keep the personal touch alive in its new ventures.
What did Compaq belatedly learn? That its true competitors were the low-priced clone makers, not IBM. While it was busy trying to sell a few thousand expensive network file-servers, others were selling the hundreds of thousands of cheap PCs that would be connected to those file-servers.
There are many developments to look forward to. Multimedia computing, which mixes text, graphics, sound, photos and videos, is getting more attention. But I don't see people flocking to it until digital video is just as good as what we see on television, and that's not possible right now.
Pen computing, which uses a stylus to write on the screen, will hit the market this year. But it's a niche market. It may be ideal for spreadsheets and specialized kinds of data entry. But it's no good for word processing.
The computer keyboard may intimidate those who don't know how to use it. And it may injure those who use it too much and suffer repetitive stress injuries.
Nonetheless, it is a marvelous device for easily converting human thought into electronic data that can be efficiently processed. If you want to be prepared for the future, learn to type. At the very least, make sure your children do.
Happy New Year.