D. Analysis of annual Federal ADP costs by agency for the general management classification of computers

The figures for "Annual Federal ADP Costs by Agency," compiled for years FY65 through FY75, are presented in Figure 17. The dollars spent as a percentage of the total Federal ADP costs show comparative spending of agencies (Figures 18 and 19). The dollars for all of the above charts are in actual dollars spent, not constant dollars, and are only for those costs connected with computers in the general management classification (since these are the only costs which must be reported to GSA).

DOD's costs remain the highest, among all agencies representing 50% of all Federal ADP costs in 1975. However, in the last half of the sixties, DOD's costs represented 60% of Federal costs. ERDA, HEW, NASA and Treasury together have accounted for roughly 30% of all Federal ADP costs over the last decade. Although in number of computers Treasury has accounted for 1.5% to 2.0% of Federal computers, its expenditures have increased by a factor of 10, now representing 14% of all Federal costs. Similarly, HEW's percentage of Federal costs is 7.5% while its percentage of the Federal installed computer base is 1.5%.

Because the total Federal ADP costs roughly tripled from one billion to three billion over the last decade, agencies whose costs have doubled (DOD and ERDA) or remained the same (NASA) show a decrease in percentage of the annual Federal total cost, while those whose costs have more than tripled (notable GSA, HEW, and Treasury) show an increase in this percentage.

Total ADP Cost $1132 $1182 $1445 $1653 $1830

$2125

$2382 $2427

$2651

$2662

$3100

1. FY65, FY66 figures include special purpose computers as well.

Figure 17

1. FY65 and FY66 bars based on all ADP costs.
Interior and Transportation (including FAA) are included with Other Civil for
FY65, FY66.

Figure 19

E. Analysis of Minicomputers in the Federal Government

A recent GAO report, Uses of Minicomputers in the Federal Government: Trends, Benefits, and Problems, looks at the uses of minicomputers in the Federal Government in the past, present and future and analyzes the problems and benefits that are attached to such uses. The basic statistics for "number of minicomputers in Government" are provided in a bar graph, "Number of Computers in the Federal Government by Computer Cost and by Fiscal Year" (Figure 20a). It should be noted that the figures given in this bar graph are rounded figures and thus do not match exactly the GSA totals given in Figure 1. Since GAO used as one of the definitions of minicomputer, "a simple computer system having a central processing unit which costs $50,000 or less," most of the computers on this chart in the category "under $50,000" are considered minicomputers.

This bar graph shows that in 1967 minicomputers represented about 26% of the Federal Government computers and in 1975 represented about 55% of the Federal computers. If the growth of minicomputers in relation to the total Federal inventory since FY70 is analyzed, the average growth rate has been about 3% of the Federal inventory. GAO states that "considerable growth has occurred in the lower-priced computers, whereas use of the middle-priced computers had decreased and use of the more expensive computers has remained fairly constant."*

To analyze the actual growth rate of the three categories of computers, the GAO bar graph was translated into numbers of CPUs (Figure 20b). When the number of CPUs is plotted on a line graph to show the growth rates of the three categories of computers (Figure 21), it can be seen that the computers costing under $50,000 are growing much faster than the other two categories.

The actual growth rate or increase in units compared to the installed base the year before was calculated for each year for all three categories (Figure 22). An average of 471 minicomputers, or computers costing less than $50,000, has been added per year over the past eight years giving an average yearly growth rate of 22%. For computers costing between $50,000 and $200,000 the average number of units with an average yearly growth rate of 3%. For the large computers costing over $200,000 the average number of units per year that are added to the installed base is 79.5 units, with an average yearly growth rate of 8%. Thus, numbers of minicomputers are growing, on an average, greater than twice as fast as either of the other two categories of computers.

*GAO report, p. 6

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