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TL;DR;

I'm asking if there is any information on why they chose to make kilobyte = 1000,

Because kilo means 1000. It simply doesn't stand for 1024. The same way 13 inches aren't a foot.

So I'm interested in the arguments used and the decision making process that lead the IEC to decide that kilobytes would be redefined as 1000 bytes,

There was no redefinition, as 'kilobytes' isn't a unit of its own. It's 'kilo' as prefix with the fixed definition of 1000 and 'byte' as, well, a byte. So kilobyte always meant 1000 bytes.

These prefixes are part of the International System of Units (SI) — though, they had already been used before, since introduced with the metric system in 1795. Within SI there are no different units for the same thing (like inch, feet, yard, furlongs, chains and miles for length) but always only one (meter for length, ampere for current, and so on). To use them in different circumstances they are prefixed according to powers of 10. A very convenient system.

And it was sloppy engineers who used this convenience to describe certain binary values with somewhat close values — as 2^10 is 1024 and thus close to 1000. These were never official units in any way, just a kludge to get along. Standard documents always used power of 10 pefixes — which leads, by the way, to the effect of serial transmissions always being decimal - a 9.6 kbit line transfers 9600 bits per second, not 9830 :)

When computers came out of the closet in the 1980s, people stated to recognize that these 'kilobytes' aren't really a kilo of bytes but different, so it was common to capitalize the K, as the SI prefix uses a lower case k. Nice idea - as long as memories stayed in the range of a few dozen to a few hundred KB - but when 1024 KB were reached, it broke, as the SI prefix M is already uppercase.

In the late 1980s/early 1990s it became obvious that there is a need for a clear meaning, so an international standard was proposed - and accepted in the late 1990s.

It's now more than 20 years later ... heck, not even the English complained that long about the loss of their non-decimal currency.

and the creation of the rather awkward "kibibytes".

The binary prefixes are anything but awkward. They offer an easy, convenient and well-defined way to operate with (almost) the same prefixes as for any other unit, but now making it binary, which does make a lot of sense for computing, doesn't it?

Postfix:

It may be useful to add a bit of common sense before going into rather pointless nagging about how it sounds or how much we're used to the imprecise way it always has been. The main point about these binary prefixes is in writing, not speaking. When talking there is context. Continuing to say 'kilobytes' when KiB are meant should be fine. After all it's much like asking for a pound of meat in a metric country works, though hey will give you 500g :))

Just write the prefix always uppercase and add a lowercase 'i' for binary and there's no more confusion.

To me it seems like kilobytes were well established as 1024 bytes, both by programmers using them and by electronic engineers

They are not the only people though. The term got confusing mostly because of disk manufacturers who preferred base 10 because your disk capacity was a larger number. Perhaps the most egregious nonsense comes from the high density floppy disk which is described as having 1.44 Megabytes where a Megabyte is defined as 1000 kilobytes and a kilobyte is defined as 1024 bytes. i.e. 1.44 × 1000 × 1024 which is plainly ridiculous.

Also "kilo", "tera" and "mega" are standard SI terms meaning various powers of 1,000 (in base 10). It should, therefore, be a good idea to have different names for the base 2 versions.

Disclaimer: I personally ignore the base 2 names and abbreviations because they are stupid.

While JEDEC memory standards were using 1024 Byte Kilobytes at the time, many magnetic storage devices were using 1000 Byte Kilobyte size for several reasons.

To explain where the 1024 Byte value comes from, it is a nice convenient 2^10 value.

However, this use of power of twos only applied to RAM and ROM. Magnetic media did not use power of two dimensions, and thus when marketing saw that they had to chose between two numbers, the irrelevant 1024 based standard of memory or 1000 based traditional metric standard. They chose the traditional metric standard, since neither produced a nice round number and the 1000 based number created a large number.

This of course caused untold issues, and neither side was really wrong. Disk drives were not JEDEC memory devices. IEC, thus decided to settle the matter on disk drives by having two different units for magnetic data storage. Kibibytes and KiloBytes.

I agree that we should never have redefined kilobyte, megabyte, etc. But the definition is older than the use in computers. Which wasn't much of a problem when the difference between the two unit prefixes is fairly small, but with higher numbers the differences become significant.

1) A kilometer is 1000 meters. A kilowatt is 1000 watts. a kilogram is 1000 grams. It makes absolutely no sense to make a kilobyte 1024 bytes.

2) The difference between a kilobyte and a kibibyte is 2.4%. That's not nothing but really no huge problem. The difference between a megabyte and a mebibyte is 4.8%. The difference between a terabyte and a tebibyte is 9.95%. You're slowly getting to significant differences there.

3) Just because we made mistakes in naming things several decades (half a century) ago, doesn't mean we can never change things. In fact changing things sooner would have been better.

The source here is a confusion of standards.

SI is the Système International. It governs physical quantities like Kilo's and meters. In this system, the quantity information is measured in Joules per Kelvin.

In computing, information is measured in bits. Joules Per Kelvin is just too inconvenient.

There's no confusion when using SI prefixes with SI units. A Megajoule per Kelvin is 1.000.000 Joules/Kelvin. But this is a whole lot - a modern harddisk might contain barely one nanoJoule/Kelvin (0.0000000001J/K)

Going back to bits, "SI-insipired prefixes" are used. But a kilobit is 1024 bits, and it's been that way since the introduction of the Intel 1103 : the first RAM chip in the world, with a 1 kbit (1024 bit) capacity.

The real confusion started when harddisk makers found out that they could sell bigger numbers by intentionally mixing the SI Giga- prefix with the non-SI unit "byte" (8 bits). This was fraudulent, and multiple class action lawsuits were settled with refunds for the buyers (around 2007).

IEC unfortunately came up with yet a new system, using non-SI units with both SI prefixes in their SI meaning and an entirely new set of prefixes (kibi etc). But in a sense this is no surprise; that's what engineers do when there are conflicting standards. (Bonus)

(As other replies, this is not the direct answer, just some hanging around.)

When I worked at Internet service provider, we ran into problem with that prefixes: in communications, stream rate is defined at units of 1000, like 64 kbits = 64000 bits. OTOH, many programs count sizes in portions of 1024.

After a few attempts to fix this, the final decision was as follows: a usual customer contract contained definitions section that stated:

traffic is measured in:

1 kilobyte = 1000 bytes.

1 megabyte = 1024 kilobytes.

1 gigabyte = 1024 megabytes.

(This edition appeared approx. in 2001.)

I can't insert emoticons into reply in StackExchange, but I'd like to put here a shockingly astonished face. 😞? 😢? 😱? None is good here, but Munch's "Cry" is rather close.

So I'd support a general tendency to separate two suffix sets. OTOH, the particular choice of -bi is utterly brain-damaged: nearly nobody can distinguish kibi from gibi in a noisy environment. The prefixes shall be radically different in pronounciation.