925–1950: IBM's early growth

During the next twenty-five years, IBM's organization and product lines grew steadily. Despite the Great Depression of the 1930s, IBM continued to develop and manufacture new products, and after the Social Security Act of 1935 secured a major government contract to maintain employment data for 26 million people. IBM's archive website^[5] describes this as "the biggest accounting operation of all time," and it opened the door for a variety of other government contracts.

In 1928, IBM introduced a new 80 column rectangular-hole punched card.^[6] This format became the standard "IBM Card" that was used by the company's tabulators and computers for many decades.

During the rise of Nazi Germany and the onset of World War II, IBM had relationships and contracts with the German military/industrial technocracy. IBM's punch card machines were used by Germany to keep track of people who were to be subjected to the Holocaust.^[7] Only after Jews were identified—a massive and complex task that Hitler wanted done immediately—could they be targeted for efficient asset confiscation, ghettoization, deportation, enslaved labor, and, ultimately, annihilation. It was a cross-tabulation and organizational challenge so monumental, it called for a computer. Of course, in the 1930s no computer existed. But IBM's Hollerith punch card technology did exist. IBM and its German subsidiary custom-designed complex solutions, one by one, anticipating the Reich's needs. They did not merely sell the machines and walk away. Instead, IBM leased these machines for high fees and became the sole source of the billions of punch cards Hitler needed.

Browning Automatic Rifle

M1 Carbine

After America entered World War II, IBM played an active role in the U.S. war effort. According to the IBM archive website:

When World War II began, all IBM facilities were placed at the disposal of the U.S. government. IBM's product line expanded to include bombsights, rifles and engine parts – in all, more than three dozen major ordnance items. Thomas Watson, Sr., set a nominal one percent profit on those products and used the money to establish a fund for widows and orphans of IBM war casualties.^[8]

In particular, IBM manufactured the Browning Automatic Rifle and the M1 Carbine.

Allied military forces widely utilized IBM's tabulating equipment for military accounting, logistics, and other war-related purposes. There was extensive use of IBM punch-card machines for calculations made at Los Alamos during the Manhattan Project for developing the first atomic bombs.^[9] During the War, IBM also built the Harvard Mark I for the U.S. Navy, the first large-scale automatic digital computer in the U.S.