Perot and Scrap Cycles

[tcmay@got.net (Timothy C. May)]

At 1:31 AM 8/19/95, Michael Froomkin wrote:
>Didn't Ross Perot make his fortune by running data processing tasks nights
>and weekends on machines he leased to other people (all legal)?

I hadn't heard this.

And until I hear more details, I'm skeptical.

(Trivia sidenote: I was in high school in 1970 and met Ross Perot at a
shindig in Dallas--his wife picked me up at the airport and drove me to the
hotel. He had just that spring lost a billion dollars in a single day, due
to a glitch in EDS stock. A billion dollars in 1970 was a lot of money.)

Now in 1970 EDS was indeed leasing lots of IBM mainframes to customers, and
running them. Also, doing processing jobs.

But how many IBM mainframes were idle at night? Not many. This was the day
of multimillion dollar mainframes and programmers making $10,000 a year to
keep them busy at all times.

So, I doubt the machines were idle in the same way our workstations and PCs
are largely idle (obviously, machines now cost less $2000-6000, and
programmers make 10-20 times that...the tables have turned).

I don't discount the possibilty that EDS made a deal on the lease rates. I
haven't read up on EDS in this era. I just know that Perot wasn't using
"scrap cycles" (to use Doug Barnes' term), because there probably weren't
many of them.

But I'd like to hear the details.

--Tim May

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