These computers used vacuum tubes which were large and expensive.
The use of transistors marked this generation.
The introduction of integrated circuits hailed these computers.
Second generation computers evolved with the replacement of the vacuum tube by the transistor. Other changes that marked this generation were the introduction of more complex arithmetic logic units and control units along with the use of high-level programming languages and the provision of system software with the computer.
Along with these came dramatic speed improvements which were a result of improved electronics and more complex circuitry. The IBM 7094 included an Instruction Backup Register. When the control unit fetched 2 storage locations from memory, it stored 1 in the Instruction Backup Register so the control unit only had to make half the calls to main memory, resulting in reducing the average instruction cycle time.
The introduction of data channels was quite significant. They are independent I/O modules and contain their own processor and instruction set allowing these modules to take care of the I/O instructions, resulting in relieving the CPU of considerable processing burden.
The multiplexer acts as a central termination point for the data channels, the CPU and memory. Scheduling access to each of these devices, it allows them to act independently of each other.