COMMITMENT TO FIXED TERM RENTALS OF IBM EQUIPMENT

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80-01794R000100200034-2
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 4
• Document Creation Date: December 12, 2016
• Document Release Date: December 26, 2001
• Sequence Number: 34
• Publication Date: August 27, 1973
• Content Type: MFR

AUG
a27
SUBJECT: Commitment to Fixed Term Rentals of IBM Equipment
1. This fiscal year IBM has increased the monetary
incentive to place some of their rental equipment on a
twenty four (24) months rental plan. The previous Fixed
Term plans offered an 8% decrease in rental for 12-23 months
and a 16% decrease in rental for a 24 month commitment.
Both of these plans carried an unlimited use clause (no
charge for. use over 176 hours per month).
2. For the Fiscal Year 1974 GSA contract, IBM has
offered to credit all rental for the month of July 1974 for
those machines placed on the 24 month plan. This must be
done before 1 September 1973. Four of the machines
presently installed (3333-1-Disk Storage and Control Units)
are only available on the 24 month plan.
3. IBM has also made recent announcements of new
equipment that impact the decisions to be made regarding
such long term rental.
a. The first announcement concerns new magnetic
tape drive units which quadruple the recording
density on tape with the same tape speed
therefore quadruple the data transfer between
the tape unit and the Central Processing Unit.
b. The company has also announced a Disk Storage
Unit that doubles the density of a Disk Pack
and therefore its disk drive from 100 million
bytes to 200 million bytes.
4. Because of our large STAR data base both of these
features are very attractive to the DO Computer Center. The
importance here is that the equipment on hand can be
modified to take advantage of these new capabilities and are
still eligible to be placed on the 24 month plan with
advantages of the savings in rental.
5. At present, all the machines in question, for which
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therefore no overtime is now being paid. The savings in
overtime are not a factor in this decision.
6. We propose to take advantage of the savings offered
on most of the equipment that is available for the 24 months
rental plan as summarized in Attachment A. This will result
in a savings of $79,874 for Fiscal Year 1974 and depending
.upon those machines upgraded an approximate savings of
$55,000 in Fiscal Year 1975. Attachment B lists equipment
now installed that will or will not be placed under the
above plan.
25X1A
Acting Deputy for Information Systems, ISG
Attachments (2)
cc: D/OJCS/DD/M&S
C/IS/O
ISG/BF
Approved For Release 2002/01/15 CIA-RDP80-01794R000100200034-2
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 Approved For Release 2002/01/15 : CIA-RDP80-01794R000100200034-2
FT
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July 73
FY74
FY75
12 Months
x2
24 Months
Credit for
24 Months Plan
Total
Savings
Savings
Printers & Controllers
$155,424.
$141,936.
$5,914.
$12,658.
$6,744.
Tape Controllers
80,988.
73,932.
2,730.
5,850.
3,936.
Tapes
214,176.
198,000.
7,952.
17,120.
9,564.
Disk Storage
658,704.
608,640.
16,214.
37,718.
28,560.
Disk Storage & Control
87,696
74,640.
(1)
6,528.
6,528.
$32,810.
$79,874.
$55,332.
79,874.
Total Savings FY74 & FY75
$135,206.
(1) Not eligible for July 73 credit as installed after 1 July 1973.
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 Approved For Rel
4-1403 N1
2-2821-1
2-2821-2
14-3420-7
12-3330
4-3333
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Equipment To Be Placed On
24 Month Fixed Term Plan Rental
Equipment Not To Be Placed On
24 Month Fixed Term Rental Plan
2-3420-7 Now being discontinued.
4-3330-1 Will be replaced as model l's are converted
to model 11's.
Approved For Release 2002/01/15 CIA-RDP80-01794R000100200034-2
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