The Jargon File (version 4.4.7, 29 Dec 2003):

timesharing


    [now primarily historical] Timesharing is the technique of scheduling a
    computer's time so that they are shared across multiple tasks and multiple
    users, with each user having the illusion that his or her computation is
    going on continuously. John McCarthy, the inventor of LISP, first
    imagined this technique in the late 1950s. The first timesharing operating
    systems, BBN's "Little Hospital" and CTSS, were deplayed in 1962-63. The
    early hacker culture of the 1960s and 1970s grew up around the first
    generation of relatively cheap timesharing computers, notably the DEC 10,
    11, and VAX lines. But these were only cheap in a relative sense; though
    quite a bit less powerful than today's personal computers, they had to be
    shared by dozens or even hundreds of people each. The early hacker
    comunities nucleated around places where it was relatively easy to get
    access to a timesharing account.

    Nowadays, communications bandwidth is usually the most important constraint
    on what you can do with your computer. Not so back then; timesharing
    machines were often loaded to capacity, and it was not uncommon for
    everyone's work to grind to a halt while the machine scheduler thrashed,
    trying to figure out what to do next. Early hacker slang was replete with
    terms like cycle crunch and cycle drought for describing the consequences
    of too few instructions-per-second spread among too many users. As GLS has
    noted, this sort of problem influenced the tendency of many hackers to work
    odd schedules.

    One reason this is worth noting here is to make the point that the earliest
    hacker communities were physical, not distributed via networks; they
    consisted of hackers who shared a machine and therefore had to deal with
    many of the same problems with respect to it. A system crash could idle
    dozens of eager programmers, all sitting in the same terminal room and with
    little to do but talk with each other until normal operation resumed.

    Timesharing moved from being the luxury of a few large universities runing
    semi-experimental operating systems to being more generally available about
    1975-76. Hackers in search of more cycles and more control over their
    programming environment began to migrate off timesharing machines and onto
    what are now called workstations around 1983. It took another ten years,
    the development of powerful 32-bit personal micros, the Great Internet
    Explosion before the migration was complete. It is no coincidence that the
    last stages of this migration coincided with the development of the first
    open-source operating systems.