SDC:

I learned from  Al Blue today that  you had not received  an expected
letter from John.  Subsequent research revealed that John hadn't sent
one and now  doesn't want to for  awhile.  Enclosed are a  short form
version and  a longer  expression of my  views.  I  hope that  one of
these will cover your needs.



                         STANFORD UNIVERSITY
                     Stanford, California 94305


COMPUTER SCIENCE DEPARTMENT                    Telephone 415-321-2300
                                                       extension 4202
                          February 2, 1973


Mr. Stephen D. Crocker
R & D Program Manager
Information Processing Techniques
Defense Advanced Research Projects Agency
1700 Wilson Boulevard
Arlington, Virginia 22209

Subject:  Decommitment of the Processor Project

Dear Steve:


In accordance with your request, we have suspended plans to fabricate

a high speed processor.  On this basis, we will not need  $200,000 of

the funds allocated under the current contract (SD-183).


Sincerely,



Lester D. Earnest
Executive Officer
Stanford Artificial Intelligence Laboratory



                         STANFORD UNIVERSITY
                     Stanford, California 94305


COMPUTER SCIENCE DEPARTMENT                    Telephone 415-321-2300
                                                       extension 4202
                          February 2, 1973


Mr. Stephen D. Crocker
R & D Program Manager
Information Processing Techniques
Defense Advanced Research Projects Agency
1700 Wilson Boulevard
Arlington, Virginia 22209

Subject:  Decommitment of the Processor Project


References:

1.  "Proposal for Development of a High Speed Processor", to
    Advanced Research Projects Office from Stanford University,
    January 1972.

2.  Amendment P00023 of Contract SD-183, between Defense Supply
    Service - Washington and Stanford University.

3.  L. Earnest (Stanford), "High Speed Processor Fabrication",
    letter to E. Stubbs (DSS-W), 12 July 1972.

4.  E. Stubbs (DSS-W), "Approval of Acquisition or Fabrication
    of Facilities", letter to L. Earnest (Stanford), 11 Sept. 1972.


Dear Steve:


The  purpose  of  this  note  is  to  record  recent  discussions and

decisions regarding our processor development project.


Funds for this project were requested in January 1972  (Reference 1),

and   received   in  July   (Reference   2).    Specific  procurement
Mr. Stephen D. Crocker                                         Page 2


authorization was  requested on  12 July  (Reference 3)  and approval

(Reference 4) was received at our office on 13 December.  Although we

had formal authority to proceed, we had requested a design  review in

mid-January  to  insure  completeness and  adequacy  of  the detailed

design before certain major procurements were undertaken.


PROJECT REVIEW


Our staff went over the  design with you and the review  committee on

January 15.   The general state  of the project  at that time  was as

follows.


    1.  All logic drawings complete (214 drawings).


    2.  16 of 24 printed circuit cards completely designed.


    3.  34 of 44 wirewrap cards completely designed.


    4.  design automation programs operational (and in use at MIT

        and DEC).


    5.  Prototype printed  circuit and wirewrap  cards fabricated

        and tested.


Our  schedule  called for  two  and one-half  months  more  of design

review,  paper  debugging,  and design  of  the  remaining  8 printed

circuit  and  10 wirewrap  cards.   Component procurement  was  to be
Mr. Stephen D. Crocker                                         Page 3


partly  overlapped with  this  phase and  all fabrication  was  to be

complete by the end  of June.  Our budget for  completing fabrication

was $194,315 for parts  and services, and $72,499 for  management and

staff  salaries,  miscellaneous  direct  costs,  and  overhead, which

totals to $267K.


Following  fabrication,  there  was  to  be  a  debugging  period  of

uncertain  duration,  depending  on  the  number  and  difficulty  of

problems encountered.  Development  of Tenex modifications was  to go

on concurrently.


COMMITTEE COMMENTS


You  and the  committee were  apparently convinced  of  the technical

adequacy of  the design  as far  as you  could probe  it in  the time

available.  There was some variance of opinion on the  schedule, with

the designer's estimates being (predictably) more optimistic than the

committee's.   Even so,  there appeared  to be  a consensus  that the

processor could be  made fully operational by  the end of  this year,

barring major catastrophe.


I heard no criticism of the fabrication budget estimates.  Additional

costs for  debugging and initial  exploitation of the  processor were

not given and are more  difficult to estimate.  My estimate  is about

$80K.  Apparently, yours was higher.  We were planning to cover these

expenses under our computer facility budget.
Mr. Stephen D. Crocker                                         Page 4


Overall, John McCarthy and I were pleased with the recent performance

of  the design  group and  with the  committee's evaluation  of their

work.


DISCUSSION


Subsequent  to the  project review,  you asked  us not  to  build the

processor,  citing  schedule   slippage  and  a   changing  technical

environment.   Indeed, there  has  been substantial  slippage  in the

verbal estimates of the design staff.  As you are aware, this kind of

optimism is common among designers, especially young ones.


As far as formal schedule  commitments are concerned, we were  not so

far off.  Our request for approval (Reference 3) estimated completion

by 1 February  1973 contingent upon receipt  of approval by  1 August

1972.  In fact, approval was  received 13 December 1972 and  our most

recent estimate for fabrication was  about 1 July.  I do not  wish to

argue that there was a month-for-month slip associated with  delay in

approval, but there was some coupling.


Of course,  a project  should not be  halted for  delays if  it still

makes  sense  technically  and there  are  adequate  funds available.

There were adequate funds available.


The most recent  development on the  technical front, our  spies tell

us, is that DEC is designing a machine that may come within  a factor
Mr. Stephen D. Crocker                                         Page 5


of 2 of the performance of  the one we have designed and  that theirs

will be probably be cheaper than ours would in production.  That will

be an interesting machine if it pans out.


Meanwhile, the one that our group has designed is ready to  build and

has a much higher performance/cost ratio than anything on  the market

or likely to  appear in the next  two years.  Making  the pessimistic

assumption that at most one  machine would be built, the  question to

ask in our current position is "Is it worth $350K (or whatever figure

you believe) to have  a processor 4 times as  fast as a KI-10  by the

end of this year?" I believe that the answer is yes.


DECISIONS


While not fully understanding your reasons for requesting a  halt, we

agreed to suspend procurement on the processor project.  You remarked

that you had no objection to our completing design details and trying

to convince you that the processor should be built, but  you assigned

low probability to that  outcome.  Our staff subsequently  decided to

proceed on that basis.


You also asked that we inform your office by the next morning  of the

amount  in  the contract  that  we  would not  need,  given  that the

processor will  not be  built.  I subsequently  pointed out  that our

computer system remains  badly overloaded and  that we must  get more
Mr. Stephen D. Crocker                                         Page 6


performance in some way.  I suggested that the available  funds might

be diverted to the procurement  of a KI-10 processor from  DEC, which

would provide  some increase  in performance and  would permit  us to

convert to the Tenex monitor.  You said that was not possible.


On the basis of these decisions, I reported to Al Blue (ARPA) that we

could leave $200,000 unspent.


CONCLUSIONS


As I write this,  it is 2 AM and  there are 22 people running  on our

system.  This is not unusual.  Daytime loads almost always  exceed 40

jobs.  As far as I know, there is no other PDP-10 installation on the

network that regularly carries half this load.


As things stand, we have an overloaded timesharing system, a slightly

disillusioned and very disgruntled design group, and  little prospect

for  improvement  in  either.   We  remain  convinced  that  the  new

processor was and is a  sound investment and hope to convince  you of

this.
Mr. Stephen D. Crocker                                         Page 7




In  considering alternatives,  I trust  that you  will  remember that

while hardware can never compete in performance with  paper machines,

neither can paper machines compete with planned machines.  We solicit

your help in finding solutions to our problems.


Sincerely,



Lester D. Earnest
Executive Officer
Stanford Artificial Intelligence Laboratory


cc: L. Roberts, A. Blue (ARPA)