Sickness of Opportunity cost

Sans the R and D usage scenario … most computer systems in our state don’t go for their average processing usage beyond 20%. Most of them are used for ground level  operations

And that means we are talking ~20 million (= 2 crore) systems in our state with an average price of Rs.30,000! Which have an average CPU usage of only 20%

That means on an overall basis , we lose Rs.(0.8*20mn*30,000) = Rs.48000 crores / Rs.480 billion in terms of opportunity lost

(In A.P alone! In other states, its even worse! Abroad its further more un-imaginable)

~One basic flaw in the argument! The reader who identifies it first gets a treat 😀

16 responses to “Sickness of Opportunity cost

  1. Thats not the flaw, geek-boy 😛

  2. flaw 1 : the arguement not backed by authentic data.
    flaw 2 : lets assume the data is true, u say the cpu usage is 20% cpu ,avg cpu’s cost shud be 5K cos u said the entire dabbas cost is 30K .. hence the wastage comes to 0.8*5,000 * 20 mn = Rs . 8000 Cr

    where is the party ?

  3. @ krackjack:
    dont think so much … i mean the system.. u dont use a “only a CPU ” at ground level operations

    There’s no party are nowhere near!

  4. This post screams “MBA!! MBA!! MBA!!” 😛

  5. I didnt get it.
    Firstly, how do you say the system cost is equal to usage cost. I mean if I buy a water tank of 20 litre for Rs20 to use for 10 litre water, then of course 10 litre is empty but that doesnt say rs 10 is wasted.
    The problem is surety that a 10 litre tank will cost me Rs10, that is not case. 10litre tank may cost Rs15.
    Therefore you will need for your benchmark: cost of a PC which gives that ‘20%’ usage as its 100%.

    Now, maybe, flaw you identified is different but I have got one. “mail me the treat”(desperate try at being geek)

    and what the heck!! where is reference for proof of 20% usage.

  6. Use elastic CPU – Amazon’s EC2. Save money!

  7. Ghost Chaser

    You are assuming that increased CPU usage will translate into more cash flow or “value”, if you will – which you are freely monetzing at 30,000. i.e. You assume that if you have 100% CPU usage, the result is worth Rs. 30,000.

    Opportunity costs depend on what operation you are performing on the computer – if I use my CPU to mine complex data so I can sell products better, there is an opportunity lost in not optimizing usage, if I use it to open a million games of Minesweeper and Free Cell…

    In essence, you are not allowing for variation in the population’s usage characteristics. Your argument could, I suppose, be made robust if you use a sample population, try to monetize the value they get from their x% CPU usage, and arrive at a mean and standard deviation. Then you can quote a figure for the approximate opportunity cost, along with a margin of error.

    There are lots of subjective assessments in the above method as well, so it is quite pointless to rigorously try and defend what you are saying. Besides, it takes one go-green guy to talk to you about increased carbon footprints from high CPU usage, and then you’d have to factor in social costs as well. Big headache.

    I might just be completely wrong about all this disclaimer.

  8. @ himank:
    the first person to give the correct answer was our neighbourhood’s barber! So Its common sense and not all the MBA superfluousness (for further ref., refer to arun’s commment above 😀 )

    @ sultan:

    @ sukesh:
    Good point! Lets talk about the water tank too 😀

    @ Gratiano-analogy above:
    I asked for a common-sensical flaw identification and you are again showcasing your articulation skills … go kiss the mirror arun 😛 !!

    Btw … minesweeper and cell are to be assumed here as “value” at least for this post 🙂

  9. bloody blah!! that was not a point, that was flaw in your argument. can you find flaw in my flaw?

    Secondly, the efficiency of 20% CPU usage may not be equal to efficiency when CPU works 100%. (multi-tasking is not perfect, same 5 tasks done separately with 20% usage will definitely take less time than 5 tasks done at same time with 100% usage) Therefore when you use 20% CPU, you are actually saving time. The time-vs-output factors are not taken into account.

  10. well!! for performing 20% of task u can’t purchase a 20% PC … u have to buy a full 100% PC for you

    and then… the computer’s processing usage is restricted by the user who’s operating it. since only one person can operate a machine at a time, he can only perform the task to his maximum capability…

    PS: normal human being use around 10% of their brain. how much opportunity loss is thr ??

  11. Zzzzzzzzzzzzzzzzzzzzzzzzzz

  12. Ghost Chaser

    Write something funny Abbulu. Got your dates yet?

  13. Asalu AP lo 24hours current untonda sir?

  14. Do we need computers at all? Why cant opportunities be created when they are idle or powered off?

  15. you drive the perception on audience that you can prove anything dont you 😛

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