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9/16/2010
03:15 PM
Jake Widman
Jake Widman
Slideshows

15 Budget Busting Technology Projects

Large-scale information technology projects can balloon to inconceivable figures very quickly with endless revisions, change orders and delays pushing budgets into the stratosphere. Sometimes the cost of an IT project can be measured simply in dollars, but just as often these projects costly in other ways -- in reputation, for example. With government projects, it's easy to look at the budget and see how much it costs -- or at least how much it's supposed to cost. In the private sector, it's not




Japan's National Space Development Agency and the Power Reactor and Nuclear Fuel Development Corporation received authorization for an Earth Simulator in 1997, and NEC Corporation made the winning bid. The result was delivered in 2002, and the 640-processor-node machine's 35.86 teraflops/second performance kept it at the top of the speed charts for two years, when it was displaced by IBM's BlueGene/L. But its price has kept it on top of the money charts -- the Japanese government estimated it cost $400 million, making it the most expensive computer ever built.

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The Pentagon's Joint Strike Fighter, aka the F-35, was commissioned as a replacement for more than 2,500 existing aircraft in all branches of the service, including the A-10, F-16, some F-18 variants, Harriers and others. The original plan, in 2001, was for 2,866 planes at $72 million apiece. The Government Accounting Office now estimate the planes will cost $100 million each, which means -- even with a reduced number ordered -- the program will cost at least $245 billion. Other estimates range up to $300 billion, making it the most expensive weapons program ever.

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The great-great grandfather of the iPad, the Newton PDA was introduced by Apple in 1993. It had its full measure of Apple cool, but its iffy handwriting recognition made it the butt of comic strips and late-night comedians. The Newton cost Apple its reputation, which in 1993 was the best thing the company had going for it.

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What the Zune cost Microsoft can't be measured in money. Who knows how many developer-hours were spent on the product -- which actually, when it came out, got pretty good reviews. If the iPod didn't already exist, the Zune might have become the leading MP3 player. But the iPod did already exist, and some of Microsoft's decisions as far as marketing (like making it brown) and features (like limits on how many times you could play a shared song) combined to make it too complicated and too late. What the company lost, probably forever, was a chance to make a splash in the portable music market.

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England launched the National Programme in 2002, hoping that the ten-year effort would reform the way the National Health Service processed patient information, improving service and quality accordingly. It would encompass appointment-making, prescribing, a provider directory and email service and more. It was originally projected to cost $12.4 billion, or nearly $20 billion; two years later, the Department of Health warned it might cost as much as $55 billion, more than four times as much as planned.

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When Microsoft Windows 95 came out, it boasted multitasking and dynamic memory allocation, neither of which was available in the existing Mac System 7. Copland was the company's ill-fated, lengthy attempt to develop a new operating system in-house; actually begun in 1994, the new OS was intended to be released as System 8 in 1996. Apple managed to get a developer's release out in that year, but it was wildly unstable. The failed effort cost Apple $429 million: the price it took to acquire Next Software, the foundation for OS X.

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Knight-Ridder had a vision of a home computer that would deliver banking capabilities, news and advertising to its customers. The vision was fine; the timing wasn't. The $900 initial cost (later dropped to $600) was too much for 1983 and for customers who weren't sure what they were supposed to be getting. The project was dropped in 1986, costing the media giant a cool $50 million.

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The British supermarket chain decided in the early 2000s to install an automated fulfillment system in one of its distribution centers, based on barcode readers. The system was installed in 2003, only to be riddled with errors. By 2007, the entire project was scrapped, and Sainsbury's wrote off $150 million in IT costs -- more than $230 million.

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The Canadian government started in 1997 with plans for a modest project that would cost $119 million but would be offset by $117 million in licensing fees. But political controversy led to giving the contractors, EDS and SHL Systemhouse, more than 1,000 change orders in just two years. They pushed the cost to $688 million, and by 2001 maintenance alone was running $75 million a year. In 2002, an audit estimated that the program would cost more than $1 billion by 2004.

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In 2000, Congress approved $379.8 million for the Information Technology Upgrade Project intended to improve the FBI's case management and forms processing. By 2001, the project had mutated into the development of an entirely new system, the Virtual Case File (VCS), with a contract awarded to Science Applications International Corp. The code SAIC delivered was so bug-ridden that in 2005, the entire project was scrapped.

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The ERA, begun in 1998, was an initiative to extend the National Archives and Records Administration's capabilities to include the U.S. Government's electronic records. After several years of research, Lockheed Martin was awarded a 6-year, $308 million contract in 2005 to build out the system. But late last year, a member of the House Archives subcommittee charged that the final system will cost a cool half billion more than originally projected.

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In 1990, the state of California commissioned a feasibility study for an automated child support system that would meet the requirements of the 1988 Federal Family Support Act. The report projected that the system would cost nearly $100 million; a year later, a revised report increased that to more than $150 million. By 1993, the projected cost was approaching $175 million; by 1995, more than $260 million; and in 1995, nearly $300 million. In 1997, the project was scrapped.

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Virginia assigned Northrop Grumman in 2005 the ten-year task of taking over the operation of the state's mainframe, server, desktop and network facilities. The $2.3 billion contract also called for new applications to improve the delivery of services to residents. The project has been plagued by cost overruns and missed deadlines, and last October state auditors released a report criticizing Northrop's performance. Northrop, for its part, said the blame should be shared.

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IT Hall Of Shame, Part 2


This entry may not carry the price tag of some of the others, but it's certainly tops in its category. The Diamond Flower mouse from German company Pat Says Now (don't ask us) has a body made of 18 carat white gold studded with 59 diamonds. A USB optical mouse that works with Windows, Mac and Linux, it can be yours for a mere [euro]18,600 -- less than $25,000, a bargain.

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IT Hall Of Shame

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In 2000, The United States Navy and Marine Corps signed a contract with Electronic Data Systems (EDS, now part of HP) for a department-wide network. The network was intended to provide data, video and voice communications for all personnel at reduced cost and enable them to quickly and securely share information. By 2008, NMCI included more than 360,000 computers and served more than 700,000 service members in 620 locations worldwide but had become a synonym for frustration among its users. Cost: $9.3 billion ($6.9 billion for the first five years, plus three optional years).

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IT Hall Of Shame

7 Biggest Microsoft Flops Ever

IT Hall Of Shame, Part 2

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