Today, the term PC or personal computer is taken to mean the IBM PC or a clone thereof. That was not always so. For some time after the microprocessor had burst onto the scene with the 4004 and 8008, the personal computer was most conspicuous by its absence. By 1979 it seemed surprising that no large company had taken one of the new microprocessors and used it to build a personal computer. 

Perhaps no major company wanted to create a personal computer market because, at that time, there were no low cost peripherals such as hard disk drives; display technology was very crude (simple text-only displays on domestic TVs); and there were no operating systems and rather less applications software. The enthusiast or hacker blazed the trail to the PC market by constructing simple microcomputers from processor manufacturers’ kits; for example, Motorola sold a 6800 kit of parts (CPU, memory, serial I/O, and a bootstrap loader in ROM). As there weren't any peripherals, enthusiasts had to find an old Teletype (a mechanical keyboard and printer) or construct their own display device.

Six months after the 8008 was introduced, the first ready-made computer based on the 8008, the Micral, was designed and built in France. The term microcomputer was first coined to refer to the Micral, although it was not successful in the USA. Another early microcomputer based on the 8008 was the Scelbi-8H marketed in kit form by the Scelbi Computer Consulting Company at $565 with 1 Kbytes of RAM. 

Quite a lot of interest in microprocessors came from the amateur radio community because they were accustomed to constructing electronic systems and were becoming more and more interested in digital electronics (e.g., Morse code generators and decoders and teletype displays). In June 1974, Radio Electronics magazine published an article by Jonathan Titus on another 8008-based microcomputer called the Mark-8. As a result of this article, several user groups sprang up around the US to share information – a forerunner of the web. 

In January 1975 Popular Electronics magazine published one of the first articles on microcomputer design by Ed Roberts, the owner of a small company called MITS (based in Albuquerque, NM). MITS was a calculator company going through difficult times and Roberts was gambling on the success of his 8080-based microcomputer kit that sold for $395 and included 256 bytes of random access memory. Altair was programmed from a row of switches on the front panel. You had to enter a program bit-by-bit – an operation reminiscent of the time of the first mainframes. Ed Roberts's microcomputer was called Altair 8800. It has been stated that the writer asked his daughter what the computer in Star Trek was called and she said "Computer". So he asked where the Enterprise was heading. She said "Altair." 

Although the Altair was intended for hobbyists, it had a significant impact on the market and sold 2000 kits in its first year. It increased the number of people using microprocessors and helped to encourage the early development of microprocessor software. Moreover, the Altair had a bus, the so-called S-100 bus that could be used to connect peripheral cards to the computer. At least it would once peripherals had been invented. The first Altair was a bit like the very first telephone – there was no one to call….  

The S-100 bus was not designed by a team of specialists and yet it was eventually granted an IEEE standard (IEEE 696). This was a case of an industry being set up by small groups of entirely ordinary people (as opposed to large organizations). Indeed, you could say that the Altair was to have another effect on the development of the computer industry – one of the first to write programs for the Altair was a young man called Bill Gates who designed a BASIC interpreter in July 1975. 

Early microprocessors were expensive – Mark Garetz in an article in Byte in 1985 describes a conversation he had with an Intel spokesman in 1975 who told him that the cost of a microprocessor would never go below $100. On the same day, Garetz was able to buy a 6502 for $25 at the WESCON conference. With prices at this level enthusiasts were able to build their own microcomputers. Lots of "personal computers" sprang up during this time. Some were based on the 6502, some on the 8080, some on the Z80 and some on the 6800. The very first systems were all aimed at the electronics enthusiast because you had to assemble them from a kit of parts.

 Typical machines of the early 8-bit era were the Apple I and Apple II, the KIM-1, the Commodore PER, the Sinclair ZX80, and the VIC-20. These created a generation of computer programmers and hardware experts. 

The 6502-based KIM 1 microcomputer had 2 Kbytes of ROM holding a primitive operating system, 1 Kbytes of RAM, an octal keypad, an LED display, and used a domestic cassette recorder to store programs. However, in just a few years the IBM PC was to appear and all these first-generation computers would be swept away to leave only the IBM PC and Apple's Mac in the ring.

 It was surprising that no large organization seemed to want to jump on the personal computer bandwagon. Tredennick stated that there was a simple reason for this phenomenon – microprocessors were designed as controllers in embedded systems such as calculators and cash registers and the personal computer market in the 1970s represented, to a first approximation, zero percent of a manufacturer's chip sales.

 In March 1976, Steve Wozniak and Steve Jobs designed their own 6502-based computer that they called the Apple 1 – they had both been influenced by the Altair 8800. A year later in 1977 they created the Apple II with 16 Kbytes of ROM, 4 Kbytes of RAM and a color display and keyboard. Although unsophisticated, this was the first practical personal computer. 

The next development was unanticipated – the writing of the first spreadsheet called VisiCalc in 1978. Although spreadsheets are common today, they did not exist before the personal computer. The spreadsheet enabled the personal computer to jump from the enthusiast-driven market to the business market. In turn, this created a demand for other business software such as the word processor.