The Computer Buzz

April 17th, 2008

Nome and Paul Van Middlesworth - owners - The Computer Factory
 

Looking Back

A few weeks back one of our long time customers brought in a copy of our system price sheet from December of 1996. Just for grins we decided to price a 1996 configuration at today's components cost. It was so interesting that we then decided to reverse the process and price a modern configuration at 1996 component prices. We show the results in the top half of the next three columns:

It’s amazing to find that nearly all of the components in our present day PCs like LCD screens and DVD recorders actually existed in 1996. They were not available as PC components but were available for commercial and industrial processing.

We found that low tech components like keyboards, mice and case/power supply assemblies have changed little because their price is determined to a large extent by the cost of copper, steel, petro-chemicals and labor. Increasing costs of commodities and labor have largely offset improvements in tech nology.

In stark contrast to the rest of the PC industry, Microsoft products (operating systems and Office suites) have continued to climb. Because Microsoft is virtually an unregulated monopoly (in the USA), Microsoft has been able to not only maintain but increase the price of its products. In 1996 the Windows 95 operating system represented about 5% of the cost of an average PC. Today the Vista Home Premium operating system is around 20% of the cost of a new PC.

While the improvement in the feature/function/performance to cost ratio in the rest of the PC industry has been spectacular, Microsoft's bloated bureaucracy has produced little to cheer about. Microsoft's latest operating system "Vista" offers no advantages over the previous O.S. "XP," runs slower, consumes more electrical power, and is incompatible with much of the hardware and software that is in use today. Yet it costs more and Microsoft is trying to force it on American PC users.

Microsoft is the poster child for the need to enforce anti-trust laws in America but it won't happen for two reasons. First Microsoft has enough money to buy legislative influence. Second, because there is not an attorney on the federal payroll that has the "cajones" in step into a court room against Microsoft's "Dream Team."