CSIRO Computing History, Chapter 4
Last updated: 4 September 2020.
Robert C. Bell
Status: 1985-86 annual report done.
Chapter 4. Csironet – later 1980s – privatisation and decline: growth of local computing, IDAPS/PAXUS
The Review of the CSIRO Division of Computing Research from February 1984 together with the Statement of Executive Decisions marked a turning point for Csironet. The review contains useful information on the history of computing in CSIRO, and the development of the service. On p 9, it is noted that ‘CSIRO was initially the major user of the network, but in recent years CSIRO usage of CSIRONET as a fraction of total revenue has decreased to about one-third of the total. The principal users now are Commonwealth government departments.’ (There is a curious slant here that usage as a proportion of revenue is used: Commonwealth Government departments were, at least initially, charged the same rates as CSIRO users.) Thus one can see a justification within CSIRO for asking why it was running a service principally for external users?
This was not the first review, and the report contains:
(In this era, people said that CSIRO stood for Commonwealth Scientific and Incessantly Reviewed Organisation!).
The computing service and its associated developmental activities were placed into a separate agency known as CSIRONET, effective from 1 January 1985. Research activities not directly related to the computing service formed part of a new CSIRO Division of Information Technology.
1984-85: CSIRONET: over 150 basic nodes, 53 hosts
The 1984-85 CSIRONET Annual Report can be found here (38 pages – far shorter than previous years, but there was also a CSIRONET Research and Development 1984-85 publication here). The cover featured an unnamed user of the Image Processing Laboratory and a reflection of Phil Robertson – the Lab continued in CSIRONET.
The front cover was overlaid on text Division of Computing Research while the next page was overlaid on text CSIRONET.
The date of acquisition of this report by the CSIRO Headquarters Library shows a fairly lengthy delay in the availability of the report.
The Chairman’s report had a fairly biting criticism of the bureaucracy under which CSIRONET was operating – reporting directly to the Board of Management and to the CSIRO Executive.
The problem of low utilisation of the Cyber 205 was viewed as a problem primarily for CSIRONET’s finances – until utilization improves. But, it was not easy to port codes to the machine and gain a substantial fraction of its peak performance, and the front-end environment was foreign to most of the university sector, and the charging-by-usage regime was unfriendly in the era when local computing power was becoming more affordable and more widespread.
The Chairman’s report also responded to criticism of the charging rates, contrasting the rates with commercial services. However, the crucial comparison with ‘free’ access to local systems and overseas centres was overlooked. (One of my colleagues spent a sabbatical at the National Center for Atmospheric Research in Boulder Colorado, taking advantage of the ‘free’ access to supercomputing reseources.) Marketing was seen as the answer.
Acknowledgement was made of ‘ a fairly painful and disruptive period for the staff’, with the hope that the organization will settle down and achieve its objectives. Instead, even more change was ahead!
Here’s a view of the CSIRONET site at near Black Mountain from Clunies Ross Drive.
A changed structure was seen as a gain.
A view of the Cyber machine room: disc drives in the front, the Cyber 76 on the left, tape drives on the far wall, the Cyber 845 on the right and part of the Cyber 205 on the right.
The case was made for a Bureau service when local systems were growing in power. The same arguments were used in later years to justify in-house and national shared facilities, and in recent years, the use of cloud services – someone else’s computer. It failed to address the idea that big machines can be used to tackle bigger problems than can be run on small systems, and the idea that high utilisation can be achieved on shared systems whose users have time-varying demands, as is typical in scientific research.
CSIRONET offered several levels of access.
The number of node locations continued to increase, along with the number of nodes (over 100 basic nodes) and host connections (53).
Here’s a list of the major facilities – hosts and services.
The Mail system came into general use in February 1985.
Another COM unit was acquired.
The Supercomputer Applications group was involved in developing software for the Cyber 205, and the CSIRO Executive started a grants scheme for access to the Cyber 205, avoiding the charging barrier (which still, unfortunately, applied to the necessary front-end access).
Effort was being expended in integrating UNIX hosts into CSIRONET.
The Micronodes were fulfilling their promise of greater reliability.
Fibre optic networking was used for the first time.
Software developed by CSIRONET was being sold, including the Ed editor.
Here’s an organisation chart.
Here are pictures of some of the Board and management team members, and details of the Board and senior management. Peter Hanlon was a staff-elected member of the Board, which I’d imagine was a difficult position in a time of change.
The statement of funding again shows a round amount for CSIRO Users of CSIRONET, implying that the CSIRO Executive was guaranteeing a fixed block of revenue. It explains why, in a few years, CSIRO was canvassing Divisions with special allocations to be spent on CSIRONET.
1985-86: CSIRONET: 190 nodes, 50 hosts, 2000 terminals, 230 remote peripherals
The 1985-86 CSIRONET Annual Report (24 pages – shorter still) can be found here.
CSIRONET outsourced its support functions in SA and WA to Intran Australia (CoResearch July 1985).
From then, CSIRO set in train a process to privatise Csironet. The first half was sold in about 1986, and in response to a letter of Rob. Bell’s published in CoResearch (Sep 1985 – see below), the CSIRO CEO wrote (CoResearch Oct 1985 – see below) that CSIRO would not sell any more, and would retain control. However, within about a year, CSIRO sold the remainder, while keeping the Cyber 205 and its services separate, and providing block grants for access, but constraining usage by requiring access to the front-ends to be subject to charging.
Below are extracts from the 1985-86 CSIRONET Annual Report.
The cover featured a stylised portrayal of the network.
The foreword anticipated that the reorganisation to be more commercially oriented would lead to an exciting future.
The statement of purpose was wide, but was curious in the statement of the need for a surplus – see the financial statements below.
The Chairman’s Report started by highlighting the difficult year financially because of the cost of the Cyber 205, and the need to boost revenue through sales and marketing activities. He highlighted the need to build communications and inter-personal skills among staff – perhaps a reflection of the staff members previous emphasis on in-house research, development and operational delivery.
The Cyber 205 was transferred to CSIRO, thus off-loading the cost burden, while CSIRONET continued to operate it. An ADIC study was initiated on the topic of fully separating CSIRONET from CSIRO, and concluded it would be difficult without a partner: discussions were underway with prospects.
Peter Claringbold’s retirement as Chief Executive of CSIRONET after 16 years with DCR and CSIRONET was noted – a key figure. Staff were thanked for their efforts in paving the way for the future, and for the very well executed changeover from the Cyber 76.
David Glavonjic took on the role of Chief General Manager. His report follows.
He touched on the challenges of rebuilding and redirecting, the de-commissioning of the Cyber 76, the acquisition of a Cyber 840 (to complement the Cyber 845), the replacement of the FACOM M190 with an M380, the decision by CSIRO to operate the Cyber 205 as a research facility, the development of a stand-alone network product, and challenges for the future.
It then provided an overview of CSIRONET services.
The network was featured. The Network Product led the section. CSIRONET’s development of hardware and software communications were highlighted as the only such development in Australia. The Network Product was described as being virtually assured of success domestically because of its price/performance ration and guaranteed local support.
Micronodes packaged into the Network Product are shown on the right of the following picture, while older PDP-11 nodes are on the left.
Electronic mail was well established, with a directory service made available – presumably on-line!
Network growth continued, with 190 nodes in operation. The local area network was extended to all the major mainframes, the TFS, and the specialised output devices.
A rather bold claim was made for the capabilities of ray-tracing and animation.
Techway, the Australian agent for the NSC Hyperchannel installed at CSIRONET, acquired a controlling interest in Office Automation, which had co-developed the Micronode, and was then involved in the workstation project.
OSI was seen as the only cost-effective way for CSIRONET to continue to satisfy the interconnection demands of CSIRONET users.
The statement of funding showed a large direct allocation by CSIRO – $700k for the Cyber 205 Merit Allocation Scheme, and funding of $2.45M of the 1985/86 deficit.
The statement of expenditure shows significant increases in the figures for Purchase, Lease and Maintenance of equipment – the new hosts and presumably some of the Cyber 205 costs.
See also the CSIRONET 1985 film (Cyber 205, Braegan automated tape library, etc)at https://www.scienceimage.csiro.au/video/12259/csironet-1985-/
Here is an article from Coresearch February 1986 about the CSIRONET Mail system. The heading was:
and the bottom of the article contained the following photograph.
(The photo shows Rob. Bell, textbooks on a shelf, a microfiche reader, and a HP 2621A terminal. I was reportedly reading my electronic *Mail [while not looking at the camera].)
The article states that “Last year Dr Bell sent and received more than 500 *Mail messages.”
In the CSIRONET News of Spring 1987: “CSIRONET Commercialisation Announced – publicly unlisted company owned jointly by Idaps Australia Limited and CSIRO”
Text (not corrected) from The Age, 29 June 1987, p6 announced the first stage of the privatisation.
CSIRO to sell big share in computer firm
By ROBERT CSARRAN, Canberra
The CSIRO is to sell a 60 per cent share in Its computer network offshoot, CSIRONET, to the computer services company, IDAPS. The Canberra Times’ reported yesterday that a draft agreement for the sale had been signed on Friday, and that the deal was expected to be completed late next month. Neither the general manager of CSIRONET, Mr David Glavonjic nor a CSIRO spokesman would comment on the deal last night. However, it is believed the sale of part of the network has been discussed for some years. No value was placed on the sale, although CSIRONET earns about $1S million a year. CSIRONET has been under pressure for about two years to find a partner because of its investment in an extremely powerful computer called a Cyber 205, which was said to be the biggest computer south of Texas when It was bought several years ago. Despite such large clients as Telecom Australia, the CSIRO and Government departments, CSIRONET has not had enough business to earn a healthy return on the heavy overheads of running such a large computer. The sale to IDAPS follows the breakdown of negotiations with Telecom. CSIRONET will keep the remaining 40 per cent share of the business. CSIRONET is set up as a company separate from the CSIRO so it can operate competitively in the market, without the strictures of working as part of Government. It is believed the sale may not fall under the caretaker conventions which preclude the Government from making big decisions during an election campaign. IDAPS is a computer service company known for its computer information services in the motor and banking industries. CSIRONET staff were told of the deal late last week.
Text from The Age, 5 July 1988, p31 shows how messy the ownership of CSIRONET became after the partial and then full privatisation.
Tuesday 5 July 1988 Six months of success for Csironet
Csironet has reported revenue of $7.7 million in its first six months as a commercial entity. In the same period the half year ended 31 March Csironet made a substantial after-tax profit. The executive chairman of Csironet, Mr John Dougall, said: “The result is even more remarkable because Csironet has turned an operating loss of $650,000 for the financial year 1986-87 when it was a Government organisation into an after-tax profit for six months of $440,000.” Mr Dougall, who is also managing director of the information services group of Paxus Corporation, said changes in accounting methods made direct comparisons difficult Csironet, which was the computer services arm of the Commonwealth Scientific and Industrial Research Organisation, became an unlisted public company on 1 October. Csironet became the first, public asset sold to the private sector by the Hawke Government when Idaps, now merged with Paxus Corporation, took a 60 per cent holding. Subsequent events have led to an insurance company, based in Perth, Scotland, becoming the ultimate controlling shareholder. About a third of Csironet’s revenue came from work undertaken for its former parent, CSIRO, another third from Telecom Australia, and the rest from a mix of Government and business clients. Both Control Data Corporation and Fujitsu mainframe computers are used to provide bureau and network services, but Csironet will progressively become an IBM house. That is the policy which has been adopted by Paxus Corporation. One of Csironet’s Control Data Cyber mainframes has already been decommissioned.
Paxus report distorted picture By JAY SPENCER
Paxus Corporation has reported an after-tax profit of more than $4 million on revenue of $68.6 million for the nine months to 31 March. But the jumble of financial results in the 1987-88 “annual report” give a distorted picture of the strength of Paxus Corp, which is probably Australia’s second-biggest listed computer services company after the Melbourne-based Computer Power Group. Paxus Corp was formed in February this year by the merger of the NZI Corporation’s computer services arm, Paxus Information Services Group, and the listed Australian company Idaps, which had previously acquired 60 per cent of Csironet from the CSIRO in the Hawke Government’s first sale of public sector assets. The annual report covers nine months’ trading for Idaps, six months for Csironet and only two months for Paxus Information Services Group. A statement issued with the annual report said: “Had the two companies (Paxus and Idaps) been merged for a full-year period to the new 31 March balance date, the combined revenue would have been $163,996,000, of which 45 per cent was generated from operations outside Australia.” The auditors Coopers & Ly-brand qualified Paxus Corp’s financial results for an extraordinary write-off of $29 million in goodwill. They said they did concur with the decision of Paxus Corp directors to depart from Australian accounting practices and write off goodwill in its entirety. The Paxus Corp decision contrasts with Computer Power Group, which also departed from Australian accounting standards by not writing off any goodwill. Paxus Corp’s general manager of finance, Mr John Hogg, said the write-off was to give the company a “squeaky clean” balance sheet as a lead-up to further overseas expansion. Mr Hogg said Australian accounting standards were not followed overseas and, in some cases, were not understood by … Mr John Hogg said the write-off was to give the company a “squeaky clean” balance sheet as a lead-up to further overseas expansion. overseas clients. In future, Paxus Corp would use United States accounting practices covering software products which, because they were intellectual products, added goodwill. He said the cost of developing new products would be capitalised and appear in the balance sheet. However, the cost of continuing research to improve and upgrade software products would be treated as current expenses. Determining the nationality of Paxus Corp is as confusing as its financial results. It was further confused by a hint from the chief executive, Mr Neil Cullimore, that the company could move its headquarters to London to be closer to the west European market. Mr Cullimore, who was chief executive of Paxus Information Services Group (based in New Zealand) before the merger, con tinues to be based in Auckland. He is building a new home adjoining that of the founder of Paxus Group, Mr George Wheeler, now the chief executive of New Zealand Forest Products. The New Zealand Paxus Group acquired Idaps in a reverse takeover so that the combined operations became a listed Australian company with its legal head office in Sydney. However, the New Zealand-based NZI Corporation remains the controlling shareholder of the new Paxus Corp and control of NZI Corporation recently passed to a Scottish company, General Accident Fire and Life Assurance Corporation. The merged Paxus-Idaps-Csironet business has been formed into three key operating units: Paxus Financial Systems, which accounted for 27 per cent of revenue; Paxus Professional Office Systems (24 per cent); and Paxus Information Services, which includes Csironet (49 per cent). Mr Cullimore said that moving the head office to London was “on the agenda” as result of the growing sales of Paxus Financial Systems’ products into the insurance industry. Life and general insurance offices are gearing up for the fusion of Europe into a single market, scheduled for 1992. The stiffest competition that Paxus Financial Systems faced overseas came from another Australian company. Computations Holdings. Paxus Professional Office Systems was the business on which the original Paxus Group was built after the takeover of the pioneer computer manufacturer Hartley Computers. It no longer builds computers, but has add-on boards which allow the IBM personal computer range to run Hartley’s proprietary multi-user operating system.
I was irked on a visit to the Information Technology Services Branch in around 1988 to find that CSIRO had negotiated prices for services on the Csironet systems, with a discount of 50% for administrative processing, and only about 25% for science processing!
Advanced Computing Support Group
An Advanced Computing Support Group was set up, separate from Csironet, to provide support for the Cyber 205 users, headed by Peter Price, and including Roger Brown, John Mooney and one other.
One Division’s use of computers from the 1970s to the 1990s can be seen at Garratt 1998, p128.
The Philipson book “Vision Splendid…” (2017) has a section on Paxus, which finishes with the following notes.
Once the commercialisation, restructuring and privatising was underway, CSIRONET users became more aware of the marketing, and less aware of any improvements to the service. The Cyber 205 was used heavily by those with the right codes, but usage of the other systems faded away, in the face of growing choices – mini-computers and servers, PCs and Apples, a common operating system (UNIX), and the continuing charge-by-usage philosophy. The latter was being wound back, with Keith Boardman’s response to my CoResearch letter indicating some of the problems with that resource allocation method, and the institution of a merit allocation scheme, open not just to CSIRO users, but to the universities.
The CSIRO Administrative processing had moved onto a dedicated FACOM system.