Intel 8086 and 8088 processors
Introduction: June 1978 (8086) and June 1979 (8088)
Intel introduced a revolutionary new processor called the 8086 back in June of 1978. The 8086 was one of the first 16-bit processor chips on the market; at the time virtually all other processors were 8-bit designs. The 8086 had 16-bit internal registers and could run a new class of software using 16-bit instructions. It also had a 16-bit external data path, which meant it could transfer data to memory 16 bits at a time. The address bus was 20 bits wide, meaning that the 8086 could address a full 1MB of memory. This was in stark contrast to most other chips of that time that had 8-bit internal registers, an 8-bit external data bus, and a 16-bit address bus allowing a maximum of only 64KB of RAM.
Unfortunately, most of the personal computer world at the time was using 8-bit processors, which ran 8-bit CP/M (Control Program for Microprocessors) operating systems and software. The board and circuit designs at the time were largely 8-bit as well. Building a full 16-bit motherboard and memory system would be costly, pricing such a computer out of the market. The cost was high because the 8086 needed a 16-bit data bus rather than a less expensive 8-bit bus. Systems available at that time were 8-bit, and slow sales of the 8086 indicated to Intel that people weren’t willing to pay for the extra performance of the full 16-bit design. In response, Intel introduced a kind of crippled version of the 8086, called the 8088. The 8088 essentially deleted 8 of the 16 bits on the data bus, making the 8088 an 8-bit chip as far as data input and output were concerned. However, because it retained the full 16-bit internal registers and the 20-bit address bus, the 8088 ran 16-bit software and was capable of addressing a full 1MB of RAM.
For these reasons, IBM selected the 8-bit 8088 chip for the original IBM PC. Years later, IBM was criticized for using the 8-bit 8088 instead of the 16-bit 8086. In retrospect, it was a very wise decision. IBM even covered up the physical design in its ads, which at the time indicated its new PC had a "high-speed 16-bit microprocessor." IBM could say that because the 8088 still ran the same powerful 16-bit software the 8086 ran, just a little more slowly. In fact, programmers universally thought of the 8088 as a 16-bit chip because there was virtually no way a program could distinguish an 8088 from an 8086. This allowed IBM to deliver a PC capable of running a new generation of 16-bit software, while retaining a much less expensive 8-bit design for the hardware. Because of this, the IBM PC was actually priced less at its introduction than the most popular PC of the time, the Apple II. For the trivia buffs out there, the IBM PC listed for $1,265 and included only 16KB of RAM, while a similarly configured Apple II cost $1,355. The original IBM PC used the Intel 8088. The 8088 was introduced in June 1979, but the IBM PC did not appear until August 1981.
Back then, there was often a significant lag time between the introduction of a new processor and systems that incorporated it. That is unlike today, when new processors and systems using them are often released on the same day. The 8088 in the IBM PC ran at 4.77MHz, or 4,770,000 cycles (essentially computer heartbeats) per second. Each cycle represents a unit of time to the system, with different instructions or operations requiring one or more cycles to complete. The average instruction on the 8088 took 12 cycles to complete. Computer users sometimes wonder why a 640KB conventional-memory barrier exists if the 8088 chip can address 1MB of memory. The conventional-memory barrier exists because IBM reserved 384KB of the upper portion of the 1,024KB (1MB) address space of the 8088 for use by adapter cards and system BIOS. The lower 640KB is the conventional memory in which DOS and software applications execute.
Source: Upgrading and Repairing PCs (13th Edition) by Scott Mueller.