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Evolution of Computer Systems

Third generation computers came into being with the invention of the integrated circuits. This gave birth to the microelectronics era.
The integrated circuit is a wafer of silicon with many transistors attached to it. Instead of attaching single transistors to a circuit, they are manufactured at the same time onto the wafer of silicon. These transistors can be connected with a process of metallization to form circuits.
The idea of the integrated circuit is as follows:
Initially, only a few logic gates or memory cells could reliably fit onto 1 chip. These early integrated circuits are referred to as small scale integration (SSI). Over time, it became possible to fit more components on the same chip. This growth in density is reflected by Moore's Law - the number of transistors that can be placed on an integrated circuit is growing exponentially every year. This pace slowed to a doubling every 18 months in the 1970s, but has sustained that rate ever since.
These are the consequences of Moore's Law:
The concept of a family of compatible computers was introduced by IBM with the System/360 family of computers. It covered a wide range of performance and cost.
Characteristics of a family of computers:

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About the same time that IBM released its System/360, Digital Equipment Corporation released the first minicomputer, the PDP-8. Its success was due to the fact that it was small enough to fit on a desk top or be built into other equipment. It was not as powerful as the mainframe, but its cost was so much less as to make it very attractive.
The PDP-8's low cost and small size allowed other manufacturers to integrate it into a total system for resale. These manufacturers became known as original equipment manufacturers and this became, and remains, a major segment of the computer marketplace.
The PDP-8 also introduced a new structure called the bus structure that is virtually universal for modern microcomputers.
The PDP-8's Omnibus
The Omnibus consists of 96 separate signal paths which carry control, address and data signals. As all system components share a common set of signal paths, their use must be regulated by the CPU. This architecture is highly flexible and allows modules to be plugged into the bus, creating various configurations.
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Content adapted from “Computer Organization & Architecture: Designing for Performance 7th Edition” & “Logic and Computer Design Fundamentals