Life Before the Microprocessor and How it Changed Computers

Before the microprocessor came along, computers filled up entire rooms and were very expensive. Only a few places were able to afford them, places like government labs, research universities and thriving cooperation's. When the idea of putting transistors on a silicone chip (semiconductors) to make things smaller came along, many were skeptical about whether or not it would be a good investment, for it was still in the making. People were more in to using magnetic core memory, which was less expensive. However, Intel believed that because of the semiconductor's smaller size, greater preformance and reduced energy consumpstion, it would be a better investment. Then came along the challenge to make twelve custimized chips for a set of high preformance calculators for a Japenese company known as Busicom. Ted Hoff did not like that idea, and set out to make the microprocessor.

http://landley.net/history/mirror/intel/cn71898a.htm