The information society

Ewan Sutherland

The computer industry


Industry sectors

World market shares by sectors

Collision with telecommunications and entertainment.

The infobahn

Image - use Netscape

Hardware


System/360

Barriers to entry in 1960s


Seymour Cray

Cray Research


Digital Equipment Corporation (DEC or Digital)

Graph of DEC profit and loss


Wang Laboratories


Apple Computer

The Apple Macintosh "borrowed" the user interface from Xerox

Macintosh launched ten years ago


Xerox Corporation

A major photocopier company, founder of the industry. Establised a "blue skies" research centre in Palo Alto California, where the staff developed:

Then failed to exploit them...


The IBM PC

The clone wars

The empire fights back

The fall of IBM is not the conventional American story of underinvestment, slipshod standards, and lagging technology. Even with all the recent defections, it still has outstandingly talented employees. Its rate of investment through the 1970s and 1980s was massive; R&D spending in the last half of the 1980s averaged almost $6 billion a year. No other company in the history of the world has spent that much. But still the loss of market share has been precipitate in every major product category.
Ferguson and Morris (1993) p. 84.
IBM Market shares in 1983

Changes in market shares between 1986 and 1991

RISC computing

Underlying causes of IBM's failure:

Ramsey Clark, the attorney general of the United States during the last waning days of the Johnson administration, on January 17, 1969, signed a complaint charging IBM with unlawful monopolization of the computer industry and requested that the federal courts dismember the company.

Ferguson and Morris (1993), p 10.

An extensive review of the IBM case was an early priority of the Reagan administration Justice Department. The suit was dropped in June 1982 with a curt four-sentence appraisal by the solicitor general that the case was "without merit."

Ferguson and Morris (1993) page 11.


The rise of the Japanese

First in cars, motorbikes and then in televisions, video cassette recorders.

Japanese exports of VCRs to the USA

Finally Japan has been exporting:


Shares of the world market for microprocessors

Selling chips

Long-term product planning is dangerous ... Three years is long-term. Even two years may be. Five years is laughable.
Ed McCracken, CEO Silicon Graphics in Harvard Business Review
We don't pay a lot of attention to whether or not a product is still gaining market share when we decide to launch a new product. This approach is the only way to ensure that no one gets to the market first with a faster, better, cheaper product. When someone beats us to the market, which has happened only a very few times, we are embarassed.
Ed McCracken, CEO Silicon Graphics in Harvard Business Review

Software


Key factors in company formation

Silicon Valley


Japanese Keiretsu


Conclusion


Readings

Campbell-Kelly (1990) "ICL" OUP, London
Wallace and Erickson (1992) "Hard Drive" Wiley, New York
Sculley, John (1987) "Odyssey" Fontana, Glasgow
Bauer et al. (1992) "The Silverlake Project" OUP, New York
Ferguson, C H and Morris, C R (1993) "Computer Wars" Times Books, New York

URLs


Copyright Ewan Sutherland, 1995.

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