Recession, S-Curves and Digital Equipment Corporation - History of Computing: Learning from the Past - page 183

a new market for their product. With the PDP-11 they were forced into the market by
Data General, which was formed by three ex-DEC engineers led by Edson de Castro
who was disillusioned by DEC's decision not to go ahead with the 16 bit system he
had been designing. Having formed Data General he brought a system to market very
quickly and forced DEC to respond with their very successful PDP-11 range. In this
instance it was Data General who had the disruptive technology that forced a reaction
from DEC. De Castro had worked on the design of the PDP-8 and was working on the
next system codenamed PDP-X which was to be DEC's 16 bit offering. When he left
to start Data General his name was effectively wiped from DECs official histories.
The Data General story is told in Tracy Kidders topic “the Soul of a New Machine”
[6]. In Rifkin's [3] topic there is commentary on whether the team that left to form
Data General were working on the Nova design whilst at DEC and Olsen is quoted as
saying that DEC had a copy of their log of what they were doing for their last two
years at DEC.
Looking at base technologies DEC had overlapping S-curves, starting with the
PDP-8 family in 1965, the PDP-11 family in 1970 (forced by Data General's release
of the Eclipse). The VAX 11/780 released in 1978 and the Alpha in 1992. This was
fine when there were base technology overlaps but the Alpha was fourteen years after
the VAX 11/780 and so at the limit of the S-curve creating problems for DEC in the
area of uptake. This is graphically exposed in the figure 6 which shows the gap in
major product release during the 1980's. The effect of this was hidden from the com-
pany by good sales of the VAX, the mid life kicker of the VAX 8600 and the sus-
tained economic climate of the 1980s. When the recession came, it hit DEC hard
especially as the VAX 9000 was two years late and released when the recession was
at its worst.

Recession versus product release

6

5

4

3

2

1

0

-1

year

Recession cycle Major produc t releas e

Fig. 6. Recession versus major product release

Asthana [7] looks at S-curves related to disk drive technology and comments that a
phenomenon that needs careful S-curve analysis is the moving technology target.
Again, this hit DEC in the early 1990s when a major development program should
have put them in a leadership position in disk technology. However it took them so