IBM made 20% of its profits in the 1950s from selling blank cardboard punch cards, not computers.

The architecture was brutal: IBM patented the 80-column card format (introduced 1928) and leased the hardware. Customers had to buy IBM's premium card stock because cheap knockoffs jammed the high-speed readers. Switching meant manually re-punching millions of records onto a different format—basically impossible.

The lock-in was physical. You couldn't "export" data. Your entire operational infrastructure lived on rectangles of cardboard that only worked reliably in IBM machines.

When IBM launched electronic computers like the 1401, they kept the same 80-column card as the input layer. Companies migrated to digital without re-keying decades of archives. IBM rode the punch card straight into the computer era.

This is the original razor-and-blades model in tech. The machine was the hook. The consumables were the profit engine. Standards + physical lock-in + recurring revenue = a moat that lasted generations.

Before SaaS subscriptions and cloud vendor lock-in, there was cardboard.