perkins@bnrmtv.UUCP (09/01/87)
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.
jpn@teddy.UUCP (09/02/87)
>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. Perhaps that ratio refers to PROFIT. Suppose IBM spends $10 billion on each hardware and software development. They make a profit of $10 billion on hardware (sold $20billion) and $1 on software (sold $10 billion + 1$). This is not that farfetched: IBM doesn't seem to make much money on software. Perhaps that is because IBM has yet to come out with a decent software product!