

DigiBarn Friends

Jef Raskin's writings:
"Computers by the Millions (1979)"

In late 1979, while getting the Macintosh project started, I wrote an article about the implications of manufacturing and using millions of computers, looking ahead at what an order of magnitude or two in sales would do to the industry. At Apple Chairman Mike Markkula's request I did not submit it for publication, and it was made a confidential internal report. It was released in 1982 as "Computers by the Millions," in SIGPC Newsletter, Vol. 5, No. 2.



by Jef Raskin © 1979


If "personal computers" are to be truly personal, it will have to be as likely as not that a family, picked at random, will own one. To supply even our own nation with enough computers to make this happen (over, say a four-year period) we will require, for example, twenty-five companies each producing over a million computers a year. To keep this essay short, no attempt is made to give a comprehensive treatment, but to just give the reader an idea of the magnitude and character of a few of the problems.


Let's say that you were producing a million computers per year. This is about a hundred thousand (more or less) per month. Let's also say that it cost you $1500 to build each one, of which $1000 is parts and $500 labor (a moderately expensive business system). These amounts are not accurate as to either parts/labor ratio or to absolute costs, but they are not so far off as to substantially prejudice the argument.

To be prudent, you have enough parts on hand for thirty days production. The section below on the availability of parts makes up only part of the argument as to why having some parts on hand is a good idea. (It is also a good idea to have some of the finished product in stock as well.) Given our assumptions we have to lay out one hundred million dollars a month on parts. Having a hundred million dollars of inventory laying around for a month is an expensive business. At 12% simple interest, you could make a million dollars a month just by putting that money in the bank, and not bothering with manufacturing at all.

You also have fifty million dollars a month in labor costs to think of.

On the other hand, if you are selling these computers for about $6000 each, you have more coming in than is going out. It is by no means all profit; for example, most of it probably goes for advertising.

The numbers given here are not representative of the industry, and many items (such as distribution, engineering, software and much else) have been ignored completely. But we are certainly in the right orders of magnitude. It should be clear by now that you have to be rich to produce a million computers a year.

The largest personal computer company in the world right now isn't even close to these figures.



Software, at first, doesn't seem to be nearly as much of a burden as the hardware. Certainly it does not seem to entail the constant financial drain as does hardware manufacturing. You might think that software might be written once, and then may be supplied identically for each computer. This is, of course, not quite true, as will be seen in the next section. But, for the moment, assume that software can be written once, and then merely duplicated for each customer.

Part of the catch is in the phrase "merely duplicated". Just how mere a duplication is depends on what is being duplicated. If the software is supplied on tapes or disks (or any magnetic medium) we find ourselves in a morass of time-consuming steps.

Magnetic media must be duplicated serially, and written (at best at accelerated speeds) individually. Take a diskette as an example: it might take one minute to load, copy, verify, and unload a diskette. In one month, to produce 100,000 diskettes, you will have to spend 100,000 minutes in duplication.

A working month, given two 8-hour shifts, has but 19,200 minutes, say 20,000 in round numbers. You will need five duplicators running at full speed, with no down time or other problems. To be realistic, you'd better have custom-made mass disk duplicating systems. Now have a catalog of 100 programs, and you will have to have a factory with nearly 1,000 duplicating stations, say 100 machines each of which can duplicate 10 diskettes at a time. Now you need 100 operators, their management, janitors, and so on... It is likely that companies will come into existence to fulfill the function of mass storage media duplication in this kind of scale.

Now, as an exercise in large numbers, the reader should go back and calculate the square footage required to build and warehouse the 100,000 computers per month.

Other problems arise with programs supplied on ROM, where the lead time becomes a headache (to say nothing of having someone produce all those chips, or getting into the semiconductor business yourself.) ROM is also impractical for large programs. On the opposite tack, video disks are much faster to duplicate on a per bit basis than almost any other medium, but are impractical for small and medium size programs since you have to create the whole disk at once (given most current technologies).

One technology for distributing programs that turns out to be very practical for extremely large runs (even intermixed with small runs) is the printing press. Bar codes, magnetic printing and other formats that can be run off on a printing press and read by a computer offer great opportunities in a large-scale operation. Fast readers for such codes are not presently in development.

Since documentation, point of sale information and advertising material must be distributed with the programs, the printing press is at an even greater advantage: it can do the whole job.

Software can also be supplied via a communication channel. This possibility requires a few paragraphs of its own. It is discussed below.

It is clear that software duplication will require much planning, and perhaps some new technologies.


The full power of the computer is not available to an individual who owns one until he or she can program it. This opinion is rapidly becoming a heresy. The trend is to more and more packages that do specific tasks. This trend is not to be deplored, as software packages fulfill a useful role. Another trend is toward fill-in-the-form or pick-an-item-on-the-menu customizing of programs. This trend, too, is to be encouraged. Nonetheless, unless extended far beyond what is now being done (say, to the point where the menu consists of all possible program statements) it does not give the user the full power of a computer.

This is not the place to discuss techniques for easing the average user into programming (and it certainly will not be done with BASIC, Pascal or Fortran), but it can and must be done. If not, the computer will become a mere appliance--at best performing a small number of possibly related tasks. What is desired is for the computer to become an appliance, but not a mere appliance. Its presence must be taken for granted by its user, but in the long run, the act of programming itself must be taken for granted as well.

In the short run it will be, if successful, an information appliance.


Software is seldom perfect and usually has errors (called "bugs"). The manuals that describe computers and their software often have errors, of which some will be caught. In the past, it was the custom for a computer or software manufacturer to supply "updates" to their customers to correct such errors. When you have a million customers, this becomes impractical (if not positively ridiculous).

Personal computers, unlike their larger brethren, are not sold to fixed sites, but to mobile individuals who are free to sell (and give) these machines to others without informing the factory. Of a million people, a few hundred thousand move each year, and it is very expensive to find a few hundred thousand missing people.

It costs (at present mail rates, and allowing a pittance for the material to be sent, and unrealistically underestimating labor costs) well over $300,000 to merely send a letter to a million people. To keep track of which person has which version of the software (updates imply versions) would require a large computer in itself. It will be very easy for a programmer (or almost anybody else) to make an error that costs the company a million dollars, even without anybody generating a lawsuit. All the error must do is force the company to make an update to a piece of software that went out with each machine for the last few months.

It is clear that the concept of supplying updates to software or manuals will have to go. In its place should come much better tested software and manuals, and the concept that what you buy is what you get. Later versions will be sold as new, separate programs; compatibility (especially of data prepared under previous software offerings) will become a major concern. It can be expected that people will stick with an old, familiar system rather than buy a new one--unless it contains some new features that are in themselves worth the entire purchase price.

I am concerned that what might happen is that the same old quality of software will go out and then it will not be supported or updated due to the magnitude of the problems in reaching so large a customer base. The industry has the golden opportunity here to turn people off to computers in unprecedented numbers.


Actually, software costs will be in the same order of magnitude as hardware costs, both for the manufacturer and the user. Software management, in the face of large quantities, is a less well known art than the management of large-scale manufacturing. There are a few secrets that have been written up many times, but are rarely heeded: use a single higher level language for all program development, use clean and unified design, use a management technique like the chief programmer concept and so on. But for computers by the millions, some new ideas may come into play.

The mass sales of personal computers started out with the S-100 bus machines. The concept was that you could buy all kinds of devices and plug them in. What was not said was that you then had the rather terrible task of writing software to support these new "boards". Even the more sophisticated operating systems still required detailed understanding of the add-ons. Even the second generation personal computers (Apple II, TRS-80, Pet, etc.) allow plug-ins and add-ons. This creates a software nightmare.

The third generation personal computers will be self-contained, complete, and essentially un-expandable. As we shall see, this strategy not only makes it possible to write complete software, but makes the hardware much cheaper and produceable. The kinds of options that do not give programmers nightmares are things like case color, kind of screen (so long as size, aspect ratio and resolution are unaffected), power supply and the model name.

Programmers will be very happy when the computer for which they are writing software is a constant environment. This is not to say that good programming cannot handle the problems inherent in a varying environment, and on a machine which allows many different peripherals. What is being said is that it is more difficult to program for such machines, and that such programs take up much more space. We need every help we can get in simplifying the programming problem.


Most responsible computer companies have people who can be called when a customer has a question. If 30% per year of a million customers call, then you have to handle 300,000 calls per year. Given that there are less than 300 working days per year, that means over 1000 calls per day. It is inhuman to have a person answer even 25 calls per day, so you have forty full-time people just answering questions. This seems to be a small number, compared with the numbers we have been considering, but in practice these people need management and support, there are questions coming in the mail, and the calls don't arrive evenly spaced in time. This last means that you need extra people to handle peak loads. Or, you can alienate many customers.

In addition, the people answering the phones must be very highly trained, both technically as well as in telephone decorum (you get a lot of angry calls). It is hard to find such people, slow and expensive to train them, and they usually don't last long before having to rotate to some other job. I challenge you to try to find a cadre of, say, 100 such workers. I wouldn't look forward to such a recruiting effort. Yet, it will have to be done.

Or, you can train the dealers to handle the problem. Later, we will see how many dealers are necessary.


The present crop of personal computers are nowhere near having what it takes to sell in the quantities we are discussing. The simplest problem is in manufacturability. The computers we have now were not designed for true large-scale mass production. They are full of connectors, separate printed circuit boards, nuts and bolts, and require too much hand labor. One part, say a bolt, that takes seven seconds to attach, will cost the company (besides paying for a million bolts) a full time assembler's salary each year. With various overheads (such as space, bookkeeping and more) the elimination of one bolt can save the company $40,000 per year.

That bolt wasn't nearly so interesting when you are making only 10,000 or so computers a year, and even at current rates in the 100,000 per year category it may cost only $4000 per year. But at a million computers per year, each little piece can be very expensive. If re-tooling a portion of the case so that the bolt is unnecessary costs $30,000, the re-tooling can be amortized very quickly.

Another consideration is that hardware can no longer be the usual conglomeration of little boxes held together with cables. For user convenience, there should be nearly zero set-up time. Besides, manufacturing costs are far less for one box than for many. Cables are also expensive and failure prone.

We have seen, above, that software may well demand strong restrictions on the variability of hardware. This only reinforces the same decision made on the basis of cost reductions in hardware per se.


Assume that only 1% per year of the million computers fail in such a way that they cannot be fixed at a dealer. That's 10,000 computers per year or some 500 per working day. (Many present-day personal computer companies don't ship 500 computers per day, much less are prepared to handle that many coming in and going out of a service bay.) One technician, with elaborate diagnostic equipment, might be able to fix (on the average) a dozen computers a day. With one thing and another, you will require a minimum of 50 technicians. Auxiliary clerical and shipping personnel will also be required.

This also implies that there might be some good reasons to make the computer itself more reliable--and again to minimize model changes so that automatic diagnostic equipment can be used fully. When you allow a variety of attachments to be placed inside the computer (e.g. on the bus), especially when they are from other manufacturers, it is hard at times to pinpoint problems. Since the user will not typically send in foreign devices with the computer to be repaired, the problem may not be detectable at all at the service center.

Another suggestion that the problems of service bring to mind is that the computer should be highly modular (conceptually--e.g. all timing circuits in one place on the board), and designed with strong advice from the service organization.

Consider also the number of warranty cards that you might have coming in each day--that requires a department in itself. Of course, if each computer had a built in modem and could thus "talk" over the telephone lines, and if each computer were given an electronic serial number, then you could have the purchaser merely call a toll-free number to register their new computer. You would have to set up a considerable automatic facility to handle the some 1000 to 2000 calls per day that will come in.


Assume that an salesperson can sell an average of 2 computers per day, considering both quantity and individual sales. Make it 400 computers per year (at, say, $3,000 each that means sales of $1,200,000 per salesperson). Even with such prodigious selling, and assuming 5 sales persons in the average store (so that each store sells 2,000 computers annually) we need merely 500 stores. Since that many stores at present manage to sell only about one tenth as much as we have estimated here, we probably need at least 5000 outlets. Only one manufacturer has that kind of structure at present. It doesn't manage 2 computers per store per day, much less per salesperson.

The truly personal computers will probably have to be sold from a set of chains and other stores with a maximum of about 10,000 total locations nationwide. A good percentage of sales will be through direct mail outlets.

Many "personal" computer manufacturers at this time have barely produced 10,000 computers. Only the largest companies have produced ten times this many. This is mentioned just to keep things in today's perspective: right now there are few brands of computers with which the distribution network can even be provided with one computer in each store of our projected number.


Advertising will continue on its present path, moving from the hobbyist and specialist magazines to the large-circulation general readership periodicals, to newspapers, radio and television. Eventually the personal computer companies will be sponsoring prime-time programs and special events on television, prominently backing major sports figures and other personalities, and generally making as much of a nuisance of themselves as do beer, automobile, camera, soap and tire companies.


Since some idea of the volumes required has been discussed (and left to the imagination and pocket calculator of the reader), there is not too much to be said on this score, except that many of the techniques used by the large quantity manufacturers of television sets, washing machines and automobiles will have to be adopted, including considerable automation. Unionization may occur, and if automation is not strongly under way before this happens, it will become difficult to accomplish. Some manufacturing may have to be done on an international basis.


At the present time, most electronic components are scarce, with long delivery times. Many components are on allocation from their manufacturers. Plastics and metals, due to current trends in oil pricing and metals speculation are rising rapidly in price, with some shortages already apparent. There is no assurance to be had that parts and materials for building millions of computers can be obtained.

In response to these pressures, manufacturers will use conservative design which allows second sourcing. When new technology is imperative, some vertical integration may be necessary--although this often just puts the problem on raw material supply (e.g. high-purity silicon) instead of finished goods (e.g. ICs).

If the computer we are discussing uses any chips in quantity (e.g. it might have 16 memory chips) then the company will have to buy 16,000,000 of those chips per year. Not many suppliers are prepared to manufacture, let alone sell to one customer, that kind of quantity. Incidentally, the computer company will have to receive 80,000 of those chips every working day.


We can pretty safely assume that future personal computers will have communications facilities built in. Since the only bi-directional network currently available is the phone system, we can assume that this system will be the first used extensively for inter-personal-computer communications.

We can expect the telephone company to attempt to create tariffs in response to these usages since, statistically, computer calls are rather different than ordinary voice communications. Two fundamental measures, average length of call and time density of information are much greater for computer communication.

There are two kinds of usages that can be easily foreseen. One is the sending of blocks of previously prepared data. The other is real-time computer conversations.

If we assume that the average transfer of information will be about 30,000 characters (a long letter) and that data will (for the time being) be transferred at a rate of 300 characters per second, then a typical transfer call will be 100 seconds in length. This is not an unusually long call, but the data transfer is continuous. In normal speech, there are brief pauses. On major phone routes, calls are "interleaved", with the sound from one put into the pauses of the other (this is called "time division multiplexing"). With data transfers, there are no pauses. Thus, where you might fit five 100 second voice messages into one 100 second time slot, you could only fit one computer transfer.

A real-time conversation involves two (or more) people with terminals carrying on an exchange. Such a conversation could easily last for hours. Or two computers could be co-operating on a problem, with the same duration of contact. Such usage could, in the face of a million users, tie up large portions of phone company equipment all out of proportion to the numbers using the system.

There are many technological solutions, but almost all involve major changes in telephone company equipment and/or changing the standard ways computers communicate over telephone lines. Something will have to give--either through restrictive legislation, or the quality of phone service, or through increased cost of phone service (presumably going, in part, to increasing the amount of equipment the phone company is using), or through a change in technology.


It is impossible to accurately assess what changes any new technology (or any policy or political decision) will cause. It is clear that truly massive use of a technology is quite different than the mere introduction of a new class of devices. No superhighways were created for the first few automobiles.

It is easy to anticipate more of what is now underway: new legislation, new data services (e.g. the phone book in computer-accessible form), new programming companies, new computer service firms, various kinds of clubs and organizations... It is easy to anticipate that many of these computers will end up on shelves alongside of unused tennis rackets, trumpets and fondue pots. Nobody questions that small improvements in the quality of life of people who do a lot of writing, filing and scheduling will occur.

But will the average person's circle of acquaintances grow? Will we be better informed? Will a use of these computers as an entertainment medium become their primary value? Will they foster self-education? Is the designer of a personal computer system doing good or evil?

The main question is this: what will millions of people do with them?

See Jef's other writings on this topic here

Back to Jef Raskin's Pages at the Digibarn

Please send site comments to our Webmaster.