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If I were to make a computer analogy, I would probably say that Tesla in having to deliver the Model 3, is right at the point IBM was when they were finishing u

If I were to make a computer analogy, I would probably say that Tesla in having to deliver the Model 3, is right at the point IBM was when they were finishing up the IBM 360 series: it will be a make or break product release for them. http://www-03.ibm.com/ibm/history/ibm100/us/en/icons/system360/words/ http://www-03.ibm.com/ibm/history/ibm100/us/en/icons/system3... quote from Thomas J Watson Jr.: “The expense of the project was indeed staggering. We spent three quarters of a billion dollars just on engineering. Then we invested another $4.5 billion on factories, equipment and the rental machines themselves. It was the biggest privately financed commercial project ever undertaken.”" (note $5 Billion number was in 1964, inflation-adjusted, that is many billions more)

tarlinian 10y ago
Reading about the S/360 is insane...no one makes investments like that anymore. This would be the equivalent of Intel or someone spending $40 billion dollars on engineering the and the infrastructure needed to build a quantum computer today. (What's interesting is that they would survive even if the expense didn't pan out, but no large successful company would ever do this today.)
- adventured 10y ago
  Sure they do. That's an immense spend by IBM, however lots of big companies spend in the 11 figures on projects. Exxon is spending $20 billion in the next five years to expand its oil refining and chemical operations along the gulf coast. Las Vegas Sands is planning to spend at least $10 billion just to build its Japanese operation. Verizon spent $25 billion or so over 12 years trying to build out FiOS. Wanda Group in China is spending $15 billion to build a Disney park competitor. Apple's total cost every time it builds a new iPhone is in the tens of billions including its ahead-of-time purchasing commitments.
  - tarlinian 10y ago
    All of these aren't in defining a new product. There was no guarantee of a customer base for the S/360. There was already an established market for each of these listed items. Maybe if Apple had spent that kind of money on making the first iPhone you could make a similar comparison.

tarlinian 10y ago

Reading about the S/360 is insane...no one makes investments like that anymore. This would be the equivalent of Intel or someone spending $40 billion dollars on engineering the and the infrastructure needed to build a quantum computer today. (What's interesting is that they would survive even if the expense didn't pan out, but no large successful company would ever do this today.)

adventured 10y ago
Sure they do. That's an immense spend by IBM, however lots of big companies spend in the 11 figures on projects. Exxon is spending $20 billion in the next five years to expand its oil refining and chemical operations along the gulf coast. Las Vegas Sands is planning to spend at least $10 billion just to build its Japanese operation. Verizon spent $25 billion or so over 12 years trying to build out FiOS. Wanda Group in China is spending $15 billion to build a Disney park competitor. Apple's total cost every time it builds a new iPhone is in the tens of billions including its ahead-of-time purchasing commitments.
- tarlinian 10y ago
  All of these aren't in defining a new product. There was no guarantee of a customer base for the S/360. There was already an established market for each of these listed items. Maybe if Apple had spent that kind of money on making the first iPhone you could make a similar comparison.