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From: perkins@bnrmtv.UUCP
Newsgroups: comp.sys.ibm.pc
Subject: IBM hardware vs. software R & D costs
Message-ID: <2475@bnrmtv.UUCP>
Date: Tue, 1-Sep-87 16:06:37 EDT
Article-I.D.: bnrmtv.2475
Posted: Tue Sep  1 16:06:37 1987
Date-Received: Fri, 4-Sep-87 01:28:03 EDT
References: <4381@intelca.UUCP> <416@aucs.UUCP> <4048@utai.UUCP> <16481@toto.uucp>
Organization: BNR Inc., Mountain View, California
Lines: 25
Summary: Absurd software/hardware cost ratio

In article <16481@toto.uucp>, dbercel@toto.uucp (Danielle Bercel, MIS Systems Programming) writes:
> Indeed, I recall reading an IBM report that said for every penny ($0.01)
> they spend on hardware R & D they had to spend 100M ($100,000,000.00) in
> software R & D.
> 
> danielle

This ratio is NOT possible.  IBM spends millions of dollars on
hardware R & D.  The necessary software R & D to accompany this,
using the 10 BILLION-to-1 ratio you recall, far exceeds the
gross world product.

Let's try it from another approach.  Say IBM's software R & D
is on the same order as their total profits, or $10 billion a
year.  With your ratio, their annual hardware R & D budget is
a mere $1.  That's pretty impressive when you consider that they
introduce dozens of new hardware products each year.

Next time, I suggest you add some smiley faces when you "recall"
figures from IBM reports.
-- 
{hplabs,amdahl,ames}!bnrmtv!perkins         --Henry Perkins

It is better never to have been born.  But who among us has such luck?
One in a million, perhaps.