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<p>                              United States General Accounting Office
  ____________________________________________________________________________
  GAO                         Report to Congressional Requesters
</p>
<p>  ____________________________________________________________________________
</p>
<p>  July 1991                   HIGH-PERFORMANCE
                              COMPUTING
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<p>                              Industry Uses of
                              Supercomputers and
                              High-Speed Networks
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<p>  ____________________________________________________________________________
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<p>  GAO/IMTEC-91-58
</p>
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<p></p>
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<p>         Thank you for your time.
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<p>         Sincerely,
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<p>         Jack L. Brock, Jr.
         Director,
         Government Information and Financial
         Management Issues
         Information Management and Technology Division
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<p>                              i
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<p>  _____________________________________________________________________________
  GAO                    United States
                         General Accounting Office
                         Washington, D.C. 20548
                         ______________________________________________________
                         Information Management and
                         Technology Division
</p>
<p>                         B-244488
</p>
<p>                         July 30, 1991
</p>
<p>                         The Honorable Ernest F. Hollings
                         Chairman, Senate Committee on Commerce,
                           Science, and Transportation
</p>
<p>                         The Honorable Al Gore
                         Chairman, Subcommittee on Science,
                           Technology, and Space
                         Senate Committee on Commerce, Science,
                           and Transportation
</p>
<p>                         The Honorable George E. Brown, Jr.
                         Chairman, House Committee on Science,
                           Space, and Technology
</p>
<p>                         The Honorable Robert S. Walker
                         Ranking Minority Member
                         House Committee on Science, Space,
                           and Technology
</p>
<p>                         The Honorable Tim Valentine
                         Chairman, Subcommittee on Technology
                           and Competitiveness
                         House Committee on Science, Space,
                           and Technology
</p>
<p>                         The Honorable Tom Lewis
                         Ranking Minority Member
                         Subcommittee on Technology
                           and Competitiveness
                         House Committee on Science, Space,
                           and Technology
</p>
<p>                         This report responds to your October 2, 1990, and
                         March 11, 1991, requests for information on
                         supercomputers and high-speed networks.  You
                         specifically asked that we
</p>
<p>                       - provide examples of how various industries are using
                         supercomputers to improve products, reduce costs, save
                         time, and provide other benefits;
                       - identify barriers preventing the increased use of
                         supercomputers; and
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                       - provide examples of how certain industries are using
                         and benefitting from high-speed networks.
</p>
<p>                         As agreed with the Senate Committee on Commerce,
                         Science, and Transportation, and Subcommittee on
                         Science, Technology, and Space, our review of
                         supercomputers examined five industries--oil,
                         aerospace, automobile, and chemical and
                         pharmaceutical.  These industries are known for using
                         supercomputers to solve complex problems for which
                         solutions might otherwise be unattainable.  Appendixes
                         II through V provide detailed accounts--drawn from 24
                         companies contacted within these industries--of how
                         supercomputers are used to improve products and
                         provide other benefits.  We also obtained information
                         from 10 companies in the oil, automobile, and computer
                         industries concerning how they are using and
                         benefitting from high-speed computer networks.  We did
                         not verify the accuracy of the examples of benefits
                         provided by the various companies.  Appendixes I, VI,
                         and VII, respectively, provide additional information
                         on the objectives, scope, and methodology of our
                         review, and identify the companies examined to assess
                         uses of supercomputers and high-speed networks.
</p>
<p>  #####################________________________________________________________
  RESULTS IN BRIEF       Supercomputers contribute significantly to the oil,
                         automobile, aerospace, and chemical and
                         pharmaceutical industries&#x27; ability to solve complex
                         problems.  They enable companies within these
                         industries to design new and better products in less
                         time, and to simulate product tests that would have
                         been impossible without spending months developing and
                         experimenting with expensive product models.  Some
                         companies have attributed significant cost savings to
                         the use of supercomputers.  For example, although
                         exact figures were not always available,
                         representatives of some automobile and aerospace
                         companies estimated that millions of dollars have been
                         saved on specific models or vehicle parts because of
                         reduced manufacturing or testing costs.  In addition,
                         one oil company representative estimated that over the
                         last 10 years, supercomputer use has resulted in
                         increased production of oil worth between $5 billion
                         and $10 billion from two of the largest U.S. oil
                         fields.
</p>
<p>                         Despite widespread use of supercomputers for certain
                         applications, representatives of these companies told
                         us that several key barriers currently hinder their
                         greater use.  These barriers include (1) the high cost
                         of supercomputers, (2) a lack of application
                         software, (3) the cultural resistance to the shift
                         from physical experiments to an increased reliance on
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<p>  _____________________________________________________________________________
                         computational experiments, and (4) a lack of
                         supercomputing education and training.
</p>
<p>                         High-speed networks contribute to improved
                         productivity by enabling industries to more
                         efficiently share information and resources and
                         collaborate on product development over distances.
                         Companies within the oil, automobile, and computer
                         industries, for example, rely on high-speed networks
                         to transfer large graphics and data files, and access
                         computers worldwide.  In many cases these companies
                         must use high-speed networks (as opposed to those
                         operating at lower speeds) because (1) the
                         applications in use require high transmission speeds,
                         for example to provide instant images for interactive
                         videoconferencing, (2) high volumes of traffic in one
                         or more applications are being transmitted, or (3)
                         fast response is needed for such applications as data
                         base queries.  Several companies reported that they
                         would not be able to develop products in a timely
                         manner without high-speed networks.
</p>
<p>  #####################________________________________________________________
  BACKGROUND             A supercomputer, by its most basic definition, is the
                         most powerful computer available at a given time.
                         Current supercomputers, costing from about $1 million
                         to $30 million, are capable of performing billions of
                         calculations each second.  Computations requiring
                         hours or days on conventional computers may be
                         accomplished in a few minutes or seconds on a
                         supercomputer.
</p>
<p>                         Although the term supercomputer does not refer to a
                         particular design or type of computer, supercomputers
                         generally use vector or parallel processing.  With
                         vector processing, a supercomputer lines up billions
                         of calculations and then uses one or several large
                         processors to perform these calculations.  In parallel
                         processing, many smaller processors work on multiple
                         parts of a program concurrently.  The trend in
                         supercomputer design is to add more processors to
                         achieve greater performance.  Massively parallel
                         supercomputers consisting of between 1,000 and 64,000
                         processors now exist.
</p>
<p>                         The unique computational power of supercomputers
                         makes it possible to solve critical scientific and
                         engineering problems that cannot be dealt with
                         satisfactorily by theoretical, analytical, or
                         experimental means.  Scientists and engineers in many
                         fields--including aerospace, petroleum exploration,
                         automobile design and testing, chemistry, materials
                         science, and electronics--emphasize the value of
                         supercomputers in solving complex problems.  Much of
                         this work involves the use of workstations for
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<p>  _____________________________________________________________________________
                         scientific visualization--a technique allowing
                         researchers to convert masses of data into three-
                         dimensional images of objects or systems under study.
                         These images enable researchers to comprehend more
                         readily what data reveal and facilitate the
                         understanding of problems by different types of
                         scientists and engineers.
</p>
<p>                         While supercomputers are still relatively limited in
                         use, the number of supercomputers has risen
                         dramatically in the last decade.  In the early 1980s,
                         most of the 20 to 30 supercomputers in existence were
                         operated by government agencies for such purposes as
                         weapons research and weather modeling.  Today, about
                         280 supercomputers#1 are in use worldwide.  The
                         Government (including defense-related industry)
                         remains the largest user, although private industry
                         has been the fastest growing user segment for the past
                         few years, and is projected to remain so.
</p>
<p>                         A high-speed network is generally defined as a
                         network operating at speeds of T1--1.544 million bits
                         per second--or higher.  Prior to 1977, high-speed
                         networks were employed exclusively by the telephone
                         companies.  By the early 1980s, however, these
                         services had become widely available to commercial
                         customers.
</p>
<p>                         Today, thousands of high-speed networks exist, fueled
                         by demands for a variety of applications, such as
                         electronic mail, data file transfer, and distributed
                         data base access.  Networks operating at T1-speeds are
                         common and provide sufficient capability to meet most
                         application needs.  However, there is a growing demand
                         for higher-speed networks, such as those operating at
                         T3-speeds (45 million bits per second) or greater, to
                         transmit multiple low-speed applications to many users
                         at the same time.  In addition, many industries now
                         look to such networks as a means of transmitting more
                         advanced applications that result from the use of
                         supercomputers and other sophisticated technologies.
                         The growth of T1 and T3 lines is expected to be great,
                         according to Northern Business Information/Datapro, a
                         research company and industry analyst, which projected
                         that revenues for T1 and T3 will increase three-fold
                         between 1990 and 1994.
</p>
<p></p>
<p></p>
<p>                         ______________________________________________________
                              1  This figure includes only high-end
                         supercomputers such as those manufactured by Cray
                         Research, Inc.  Including International Business
                         Machines (IBM) mainframes with vector facilities would
                         about double this number.
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<p>  _____________________________________________________________________________
</p>
<p>  #####################________________________________________________________
  INDUSTRIES BENEFIT     Supercomputers provide the five selected
  FROM SUPERCOMPUTING    industries with the ability to develop new and better
                         products more quickly.  Although most companies within
                         these industries could not provide precise figures to
                         quantify the extent of gains realized, nearly all
                         believed that supercomputers have enabled them to
                         perform previously impossible tasks, or achieve
                         significant cost reductions or time savings.
                         Moreover, industry representatives believed that
                         greater benefits would be realized in the future, as
                         these companies move toward using more powerful
                         supercomputers with thousands of processors.  Of the
                         21 companies that commented on the issue, 19 said that
                         they will be using massively parallel supercomputers
                         to a greater extent in the future.#2  Details on each
                         industry&#x27;s use of supercomputers are in appendixes II
                         through V.
  _____________________________________________________________________________
  The Oil Industry       As an early user of supercomputers, the oil industry
                         has realized substantial benefits from supercomputer
                         applications.  By using two key applications for
                         processing seismic data#3 and simulating reservoirs,
                         oil companies have improved their ability to determine
                         the location of reservoirs and to maximize recovery of
                         oil and gas from those reservoirs.  This ability has
                         become increasingly important because of the low
                         probability of discovering large oil fields in the
                         continental U.S.  New oil fields are often small and
                         located in harsh environments, making exploration and
                         production difficult.  Several industry
                         representatives estimated that the use of
                         supercomputers reduces the number of dry wells drilled
                         (at a cost of $.5 million to over $50 million per
                         well) by about 10 percent.  In addition, an Atlantic
                         Richfield Company (ARCO) representative estimated that
                         supercomputer use has led to increased oil production
                         worth billions of dollars at two large fields.
</p>
<p>  _____________________________________________________________________________
  The Aerospace          Engineers and researchers in the aerospace industry
  Industry               have used supercomputers since the early 1980s to
                         design, develop, and test aerospace vehicles and
                         related components.  Supercomputers, for example, have
                         enabled engineers to analyze aircraft structural
                         composition for design flaws and to simulate their
</p>
<p>                         ______________________________________________________
                              2  Three out of 24 representatives did not
                         comment on the issue for proprietary reasons.
</p>
<p>                              3  Seismic data reveal characteristics about the
                         earth and are gathered using sound recording devices
                         to measure the speed that vibrations travel through
                         the earth.
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<p>  _____________________________________________________________________________
                         performance in wind tunnels.  This ability is
                         important because wind tunnels are expensive to build
                         and maintain, and cannot reliably detect certain
                         airflow phenomena.  Simulation permits a reduction in
                         physical model testing, and substantial savings in
                         time and money.  As a major user of supercomputers,
                         McDonnell Douglas estimates that supercomputer
                         simulations saved about a year in the design and
                         testing of its new C-17 military aircraft.
</p>
<p>  _____________________________________________________________________________
  The Automobile         Since 1984, automobile manufacturers have
  Industry               increasingly relied on supercomputers to design
                         vehicles that are safer, lighter, more economical, and
                         better built.  By the late 1980s, the world&#x27;s 12
                         largest automobile companies had acquired
                         supercomputers.  A primary supercomputer application--
                         crash analysis--is used to simulate how vehicle
                         structures collapse on impact and how fast passengers
                         move forward.  These simulations provide more precise
                         engineering information than was possible from
                         physically crashing pre-prototype vehicles.  They also
                         reduce the number of vehicles required for these tests
                         by about 20 to 30 percent.  Consequently, companies
                         have been able to save millions of dollars annually.
                         According to General Motors Corporation
                         representatives, for example, supercomputers enabled
                         the company to crash 100 fewer vehicles when
                         developing some of its 1992 models, than it did in
                         1987.  Each test vehicle costs from $50,000 to
                         $750,000, depending on whether a production vehicle or
                         prototype is used.
</p>
<p>  _____________________________________________________________________________
  The Chemical and       Supercomputers also play a growing role in the
  Pharmaceutical         chemical and pharmaceutical industries,
  Industries             although their use is still in its infancy.
                         From computer-assisted molecular design to synthetic
                         materials research, these companies increasingly rely
                         on supercomputers to study critical design parameters
                         and more quickly and accurately interpret and refine
                         experimental results.  Industry representatives told
                         us that the use of supercomputers will result in new
                         discoveries that otherwise may not have been
                         possible.  Du Pont, for example, is developing
                         replacements for chlorofluorocarbons, compounds used
                         as coolants for air conditioners, that are thought to
                         contribute to the depletion of ozone in the
                         atmosphere.  In designing a new process to produce
                         substitute compounds, Du Pont is using a supercomputer
                         to make certain calculations needed for this process.
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                         These calculations, on a supercomputer, require a few
                         days at a cost of between $2,000 to $5,000.
                         Previously, however, such tests cost about $50,000 and
                         required up to 3 months to conduct.
</p>
<p>  #####################________________________________________________________
  BARRIERS IMPEDE        Although supercomputers have yielded highly
  GREATER USE OF         visible contributions in the selected
  SUPERCOMPUTERS         industries, representatives told us that many
                         aspects of supercomputer use remain untapped, because
                         of the following significant barriers.
</p>
<p>                         High cost:  Currently, supercomputers cost between $1
                         million and $30 million, not including the cost of
                         software development, maintenance, or trained staff.
</p>
<p>                         Lack of software:  While the evolution of software for
                         vector supercomputers has accelerated over the past
                         decade, little reliable software has been developed
                         for parallel supercomputers.  This is in part due to
                         the lack of software tools for developing new
                         parallel software and converting vector software so
                         that it can be used on massively parallel
                         supercomputers.
</p>
<p>                         Cultural resistance:  Many companies or industries,
                         particularly the chemical and pharmaceutical
                         industries, rely more heavily on physical
                         experimentation than necessary, according to
                         representatives.  Many scientists and managers see the
                         use of computational science as a dramatic break with
                         past practice, and  such a major shift in research
                         methodology is difficult to accept.
</p>
<p>                         Lack of supercomputer training and education:  Before
                         1985, university students and professors performed
                         little of their research on supercomputers.  Thus, for
                         many years industry hired students from universities
                         who did not bring supercomputing skills and experience
                         to their jobs.   According to Du Pont and Eli Lilly
                         representatives, universities are still not providing
                         a sufficient number of students skilled in the use of
                         supercomputers.  A Ford Motor Company representative
                         also noted that there is a scarcity of trained staff
                         in computational fluid dynamics, an important
                         application to the automobile industry.  Currently,
                         formal supercomputer education is primarily limited to
                         the National Science Foundation (NSF) university
                         supercomputer centers.
</p>
<p>  #####################________________________________________________________
  INDUSTRY USES OF       Like supercomputers, high-speed networks are
  HIGH-SPEED NETWORKS    making valuable contributions to many industries.
                         Companies in the oil, automobile, and computer
                         industries, for example, increasingly rely on high-
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<p>  _____________________________________________________________________________
                         speed networks to share resources and provide various
                         types of person-to-person communications.  Many oil
                         company representatives, in particular, reported
                         network traffic increases, ranging from 10 to more
                         than 100-fold over the past 5 years.  Many companies
                         thought that significant benefits--including monetary
                         savings, reduced time-to-market, and improved product
                         quality--have resulted from their use of high-speed
                         networks.
</p>
<p>                         The companies we contacted primarily use high-speed
                         networks operating at T1-speeds (1.544 million bits
                         per second).  A significantly smaller, although
                         growing, number of companies also use higher-speed T3
                         networks of 45 million bits per second.  These
                         networks generally consist of private lines, leased
                         exclusively for each company&#x27;s use, although many are
                         connected to outside commercial and private networks.
</p>
<p>                         Companies we contacted use high-speed networks for a
                         variety of reasons.  In some cases, these networks are
                         used for individual applications that require high
                         transmission speeds, such as interactive
                         videoconferencing.  Most companies also used these
                         networks as a more cost-effective way of transmitting
                         large volumes of aggregated traffic from lower-speed
                         applications.  These applications include voice
                         communication, remote computer access, and electronic
                         mail.
</p>
<p>                         Landmark Graphics Corporation, a company that
                         develops seismic data processing software for oil
                         exploration, for example, uses an extensive T1 network
                         to support a variety of applications.  This network
                         supports up to four voice lines (at 64,000 bits per
                         second each), while providing electronic mail access
                         to hundreds of network users.  This network also
                         allows users across the country to work simultaneously
                         on the development of the same software by accessing
                         and sharing files via high performance workstations,
                         and to routinely transfer voluminous files to backup
                         the file system.  A Landmark representative said that
                         network use has provided more coordinated and
                         consistent control of product development among the
                         company&#x27;s different offices, and ultimately, a
                         shortened product development life-cycle.
</p>
<p>                         The Amoco Corporation uses a high-speed network to
                         transmit very large (100 million bit to 1 billion bit)
                         files between its foreign and domestic sites.  The
                         files contain large volumes of data such as images of
                         sections of the earth, which measure about 400 square
                         miles wide by 3 miles deep.  These data are critical
                         to improving Amoco&#x27;s ability to locate oil reservoirs.
                         Because of the volume of the data, Amoco
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<p>  _____________________________________________________________________________
                         representatives said it would be impossible to
                         transmit these files to each work site without high-
                         speed networks.  If they did not have the networks,
                         the data would have to be duplicated at each site,
                         resulting in higher costs.  Moreover, according to an
                         Amoco representative, access to the supercomputer via
                         the high-speed network enabled them to make a major
                         oil discovery--the details of which are proprietary.
</p>
<p>                         Within the automobile industry, a General Motors (GM)
                         Corporation representative reported that high-speed
                         networks primarily benefit them by reducing costs and
                         increasing productivity.  For example, the network
                         permits resource sharing, reducing duplicate hardware
                         and software purchases.  One group reported saving
                         $90,000 by using university software over the network,
                         rather than purchasing it.  Another group reported
                         that it did not have to buy a parallel supercomputer
                         because it accessed one at a university via the
                         network.  In addition, a corporate networking group
                         projected a $2.3 million cost avoidance for 1991
                         because the use of a high-speed network enabled them
                         to make large data and graphics files more readily
                         available to remote sites.
</p>
<p>  _____________________________________________________________________________
                         We discussed the information in this report with
                         industry representatives and experts, and
                         incorporated their comments where appropriate.  Our
                         work was performed between October 1990 and May 1991.
</p>
<p>                         As agreed with your office, unless you publicly
                         announce the contents of this report earlier, we plan
                         no further distribution until 30 days from the date of
                         this letter.  We will then send copies to interested
                         congressional committees and others upon request.
                         Please contact me at (202) 275-3195 if you have any
                         questions concerning this report.  The major
                         contributors to this report are listed in appendix
                         VIII.
</p>
<p></p>
<p></p>
<p></p>
<p>                         Jack L. Brock, Jr.
                         Director
                         Government Information
                           and Financial Management
</p>
<p></p>
<p></p>
<p></p>
<p></p>
<p></p>
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<p>  _____________________________________________________________________________
  CONTENTS
</p>
<p>  #####################________________________________________________________
  LETTER                                                                      1
  #####################________________________________________________________
  Appendix I                                                                 12
  OBJECTIVES, SCOPE,
  AND METHODOLOGY
  #####################________________________________________________________
  Appendix II                                                                13
  THE OIL INDUSTRY       Seismic Data Processing                             13
                         Reservoir Simulation                                15
  #####################________________________________________________________
  Appendix III                                                               17
  THE AEROSPACE          Computational Fluid Dynamics                        18
  INDUSTRY               Structural Analysis                                 19
                         Computational Electromagnetics                      20
  #####################________________________________________________________
  Appendix IV                                                                21
  THE AUTOMOBILE         Automobile Crash Analysis                           22
  INDUSTRY               Structural Analysis                                 23
                         Computational Fluid Dynamics                        23
  #####################________________________________________________________
  Appendix V                                                                 25
  THE CHEMICAL AND       Molecular Modeling                                  26
  PHARMACEUTICAL         Structural Analysis                                 27
  INDUSTRIES             Computational Fluid Dynamics                        27
  #####################________________________________________________________
  Appendix VI                                                                28
  COMPANIES
  INTERVIEWED REGARDING
  SUPERCOMPUTER USE
  #####################________________________________________________________
  Appendix VII                                                               29
  COMPANIES
  INTERVIEWED REGARDING
  HIGH-SPEED NETWORK USE
  #####################________________________________________________________
  Appendix VIII                                                              30
  MAJOR CONTRIBUTORS TO
  THIS REPORT
</p>
<p>                         ______________________________________________________
                                             Abbreviations
</p>
<p>                         ARCO    Atlantic Richfield Company
                         GAO     General Accounting Office
                         GM      General Motors Corporation
                         IBM     International Business Machines Corporation
                         IMTEC   Information Management and Technology Division
                         NASA    National Aeronautics and Space Administration
                         NSF     National Science Foundation
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<p>  Appendix I
  _____________________________________________________________________________
  OBJECTIVES, SCOPE, AND METHODOLOGY
</p>
<p>  _____________________________________________________________________________
                         At the request of the Senate Subcommittee on Science,
                         Technology, and Space, the Senate Committee on
                         Commerce, Science, and Transportation; the House
                         Subcommittee on Technology and Competitiveness; and
                         the House Committee on Science, Space, and Technology;
                         we reviewed various industries&#x27; use of supercomputers
                         and high-speed networks.  The purpose of our review
                         was to (1) illustrate how the automobile, aerospace,
                         petroleum, and chemical and pharmaceutical industries
                         are using supercomputers to improve products, reduce
                         costs, save time, or provide other benefits; (2)
                         describe barriers that inhibit the increased use of
                         supercomputers; and (3) provide examples of how
                         certain industries use high-speed networks and their
                         associated benefits.
</p>
<p>                         To illustrate how industries are using and
                         benefitting from supercomputers and identify barriers
                         to their increased use, we interviewed managers,
                         scientists, and engineers from the 24 companies listed
                         in appendix VI.  We selected these companies on the
                         basis of recommendations from various experts
                         knowledgeable about industrial supercomputer use.
                         Most of the companies we selected are Fortune 500
                         companies, largely because of the resources required
                         to purchase, maintain, and use supercomputers.
</p>
<p>                         We also interviewed and obtained background
                         information on supercomputers and on industry
                         applications and future trends from industry analysts
                         and consultants, hardware vendors, and government
                         officials.  The industry analysts and consultants
                         included those from Research Consortium, Inc.,
                         Dataquest, The Superperformance Computing Service,
                         Gartner Group, Inc., and the Institute for
                         Supercomputing Research Recruit Co., Ltd.  The
                         hardware vendors included Cray Research, Inc.,
                         International Business Machines Corporation, Thinking
                         Machines Corporation, and Silicon Graphics, Inc.  The
                         government officials included those from the Office of
                         Science and Technology Policy, International Trade
                         Administration, Department of Commerce, Lawrence
                         Livermore National Laboratory, Department of Energy,
                         and National Aeronautics and Space Administration Ames
                         Research Center, National Science Foundation (NSF),
                         and NSF supercomputer centers--San Diego Supercomputer
                         Center, National Center for Supercomputing
                         Applications at the University of Illinois at Urbana-
                         Champaign, Cornell Theory Center, and Pittsburgh
</p>
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<p>  _____________________________________________________________________________
                         Appendix I
                         Objectives, Scope, and Methodology
</p>
<p>  _____________________________________________________________________________
                         Supercomputing Center.  We also interviewed and
                         obtained documents from representatives of the
                         Institute of Electrical and Electronics Engineers,
                         Inc., and the American Petroleum Institute.
</p>
<p>                         To assess how industries use high-speed computer
                         networks, we collected information from companies in
                         various industries and procured the services of Texas
                         Internet Consulting, a firm that designs and
                         implements networks for large corporations.  This firm
                         subsequently interviewed the ten computer, automobile,
                         and oil companies listed in appendix VII to determine
                         how these companies use and benefit from high-speed
                         networks.  These companies had been selected based on
                         the recommendation of experts as being frequent users
                         of high-speed networks.  Texas Internet Consulting
                         also provided background information on high-speed
                         networks and related applications.
</p>
<p>                         We discussed the information in this report with
                         scientists, engineers, and other experts from 14 oil,
                         aerospace, automobile, chemical and pharmaceutical,
                         and computer companies and have incorporated their
                         views as appropriate.  However, we did not verify the
                         validity or accuracy of the examples of dollar savings
                         and productivity improvements provided to us by the
                         various companies.  In some cases, we were unable to
                         obtain such information because it was considered
                         proprietary and could not be released.  In other
                         cases, company representatives said they had not
                         performed the extensive analysis necessary to quantify
                         such benefits.
</p>
<p>                         Our review was conducted from October 1990 to May 1991
                         primarily in Washington, D.C., and other locations
                         listed in appendix VI.
</p>
<p></p>
<p></p>
<p></p>
<p></p>
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</p>
<p>  Appendix II
  _____________________________________________________________________________
  THE OIL INDUSTRY
</p>
<p>  _____________________________________________________________________________
                         Many large oil companies worldwide--including
                         American, British, French, and Middle Eastern
                         companies--use supercomputers to better determine the
                         location of oil and gas reservoirs, and to maximize
                         the output from these reservoirs.  The oil industry is
                         among the early users of supercomputers, with ARCO
                         being the first company to purchase a Cray
                         supercomputer, in 1980, to model the largest oil
                         reservoir in the U.S.--Prudhoe Bay, Alaska.  Since
                         that time, the oil industry has invested hundreds of
                         millions of dollars in developing software for
                         supercomputer applications.  In addition, the industry
                         uses off-the-shelf, consultant-developed and
                         university-developed software.
</p>
<p>                         The oil industry is now looking at massively parallel
                         processing to achieve the next-order-of-magnitude
                         improvement in speed.  The industry has many large
                         computational problems--such as modeling entire
                         reservoirs in greater detail--that cannot be
                         practically attempted on today&#x27;s supercomputers.  Many
                         companies are experimenting with parallel
                         supercomputers and are converting vector software to
                         parallel software.  According to an ARCO
                         representative, such conversion is time-consuming and
                         expensive because programs are extremely large.
                         Despite industry movement toward parallel
                         supercomputers, most representatives thought that
                         vector supercomputers would continue to be used to a
                         great extent.  The oil industry uses two key
                         supercomputer applications--seismic data processing
                         and reservoir simulation--to aid in oil and gas
                         exploration and production.  Most representatives from
                         the eight companies we contacted said that
                         supercomputers have greatly helped them reduce costs.
                         They also stated that supercomputers have greatly
                         enabled them to (1) perform previously impossible
                         tasks and (2) improve the quality and timeliness of
                         their simulations.
</p>
<p>  #####################________________________________________________________
  SEISMIC DATA           Seismic data processing is used to produce images of
  PROCESSING             subsurface geology through calculations involving
                         large volumes of seismic data.  Analysis of these
                         images increases the probability of determining the
                         location of oil reservoirs.  This is important because
                         the vast majority of holes drilled (ranging in cost
                         from $.5 million to over $50 million) are dry and this
                         is the most reliable way of determining the presence
                         of oil or gas without drilling.  While two
                         representatives mentioned that seismic data processing
</p>
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<p>  _____________________________________________________________________________
                         Appendix II
                         The Oil Industry
</p>
<p>  _____________________________________________________________________________
                         had been critical in making significant oil and gas
                         discoveries, the details on these finds are
                         proprietary.
</p>
<p>                         Although most representatives indicated difficulties
                         in estimating the economic benefits derived from using
                         supercomputers for seismic data processing, various
                         industry representatives said that it reduces the
                         number of dry wells drilled by about 10 percent,
                         saving hundreds of millions of dollars over the last 5
                         years.  Chevron Corporation representatives stated
                         that it reduces drilling of dry off-shore wells by
                         about 50 percent.  Drilling costs for the oil industry
                         are significant, totaling over $200 billion over the
                         past decade.
</p>
<p>                         Using a supercomputer for seismic data processing also
                         permits a faster payoff for millions of dollars in
                         property, equipment, data collection, and other up-
                         front investments.  An ARCO representative estimated
                         that it saves about a half million dollars per
                         development well (a well located in a known oil field)
                         because oil is located and recovered more quickly.
</p>
<p>                         Representatives said it would be impractical to run
                         their seismic data processing applications on less
                         powerful computers.  They said that supercomputers
                         increased the speed of results from 3 to 100 times
                         that of other computers, depending on the amount of
                         data being processed.  This permits them to run more
                         iterations of a seismic image, which in turn improves
                         the image, and the quality of their drilling
                         decisions.
</p>
<p>                         In addition, supercomputers enable these companies to
                         perform more complex seismic data processing tasks
                         than would be possible on other computers.  Depth
                         migration and modeling reservoirs located around salt
                         domes are two such tasks that require massive
                         computations.  Depth migration is a process that
                         removes some of the distortion of seismic images
                         caused by layers of rocks acting as lenses.  Companies
                         are continually improving this method to provide more
                         accurate images, particularly of areas where rocks are
                         layered, such as in the foothills of the Rocky
                         Mountains.
</p>
<p>                         Another recently developed process that can only be
                         run on supercomputers--producing accurate images
                         through salt--is being used by several companies to
                         improve their ability to discover oil in areas with
                         salt domes.  This process is important because salt
                         domes are likely traps for oil.  Yet, it is difficult
                         to get a clear view of what lies under salt domes
</p>
<p></p>
<p>  Page 14                GAO/IMTEC-91-58 Supercomputers and High-Speed Networks
</p>
<p>  _____________________________________________________________________________
                         Appendix II
                         The Oil Industry
</p>
<p>  _____________________________________________________________________________
                         because salt absorbs sound waves and distorts seismic
                         images.  In 1987, Oryx Energy Company used a Cray X-MP
                         to better understand the shape of salt domes.  While
                         they had previously thought the domes were
                         cylindrical, supercomputer simulations revealed that
                         they were smaller and mushroom-shaped.  Understanding
                         their shape enabled Oryx to change their drilling path
                         and discover oil in a well in the Mississippi Salt
                         Basin.
</p>
<p>  #####################________________________________________________________
  RESERVOIR SIMULATION   Reservoir simulation, an important tool used to
                         increase the amount of oil and gas that can be
                         extracted from a reservoir, allows engineers to
                         &quot;experiment&quot; on a field by trying out various
                         recovery methods and sizes and types of facilities
                         (i.e., equipment used in extraction).  By analyzing
                         the alternatives, the most cost-beneficial development
                         methods for a field can be identified before the
                         actual production work is undertaken.  The importance
                         of reservoir simulation derives from the need for
                         long-term optimization of recovery of the world&#x27;s
                         limited fuel resources.
</p>
<p>                         Although representatives said that it is difficult to
                         estimate the economic benefits derived from
                         supercomputing in reservoir simulation, various
                         representatives said that it permits increased oil
                         yield, which one representative estimated to be worth
                         $10 million annually to their company.  One Amoco
                         Production Company representative estimated that the
                         increased yield due to reservoir simulation was about
                         25 percent for some wells.  Simulation also reduces
                         the risk of losing the oil in a reservoir during
                         production--if the oil in a well is produced too fast,
                         it may move to another area of the reservoir and be
                         lost beyond recovery.  Using supercomputers for
                         reservoir simulation also reduces the amount of money
                         spent on unnecessary recovery methods and facilities
                         and equipment.  These methods and facilities are
                         expensive--recovery methods cost from about $1 to $25
                         per barrel, while surface facilities and equipment for
                         a very large field can cost billions of dollars.
                         Investment in the wrong recovery methods and
                         facilities can break a company.
</p>
<p>                         Supercomputers have enabled the industry to perform
                         reservoir simulations of entire large fields,
                         previously considered too impractical or costly.
                         Full-field models of Prudhoe Bay and Kuparuk, Alaska--
                         the largest and third largest on-shore fields in the
                         U.S.--were used to improve recovery methods.  An ARCO
                         representative estimated, conservatively, that
                         reservoir simulation used for these oil fields has
</p>
<p>  Page 15                GAO/IMTEC-91-58 Supercomputers and High-Speed Networks
</p>
<p>  _____________________________________________________________________________
                         Appendix II
                         The Oil Industry
</p>
<p>  _____________________________________________________________________________
                         resulted in about a 500 million barrel increase in
                         production, worth between $5 billion and $10 billion.
</p>
<p></p>
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<p>  Appendix III
  _____________________________________________________________________________
  THE AEROSPACE INDUSTRY
</p>
<p>  _____________________________________________________________________________
                         Aerospace companies were among the earliest users of
                         supercomputers, which are regarded as essential tools
                         in the design, development, and testing of aircraft,
                         missiles, and other aerospace vehicles and components.
                         Furthermore, representatives generally consider
                         supercomputing critical to competing for advanced
                         military and other contracts.  Of the six American
                         companies we contacted, four began using vector
                         supercomputers in the early 1980s, and by the late
                         1980s all had at least one supercomputer.
</p>
<p>                         Most of the aerospace software applications were
                         initially developed in federal government
                         laboratories.  For example, NASTRAN, one of the early
                         software programs for analyzing the structure and
                         shape of an object, was developed through research
                         sponsored by the National Aeronautics and Space
                         Administration (NASA) in the mid-1960s.  Supercomputer
                         software is commercially available for some aerospace
                         applications, but companies also use software
                         programs developed by government facilities, and
                         develop or modify software for proprietary use.
                         Since 1987, five of the six companies have begun
                         experimenting with massively parallel supercomputers
                         to determine how to best use them and to develop
                         application software.  One of the companies has a
                         massively parallel supercomputer dedicated to
                         classified military projects.  Company representatives
                         indicated that in the future, their companies expect
                         to use massively parallel supercomputers to a greater
                         extent, primarily for computational fluid dynamics--an
                         application that permits engineers to simulate wind
                         tunnels.  However, the lack of software is currently
                         limiting use of this technology.
</p>
<p>                         The major supercomputer applications used by the
                         aerospace industry are computational fluid dynamics,
                         structural analysis, and computational
                         electromagnetics.  Most companies we contacted
                         reported that these applications allowed them to
                         perform previously impossible tasks, improve the
                         quality of products, and reduce the time required to
                         make products commercially available.  For example, a
                         Lockheed Aerospace representative said that
                         supercomputers allow engineers to perform analyses in
                         areas of fluid dynamics, in which it is impossible to
                         conduct physical tests.  A McDonnell Douglas
                         representative stated that supercomputers help
</p>
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</p>
<p>  _____________________________________________________________________________
                         Appendix III
                         The Aerospace Industry
</p>
<p>  _____________________________________________________________________________
                         engineers improve product quality by permitting them
                         to perform analyses and simulations much faster and
                         over a broader range of parameters.
</p>
<p>  #####################________________________________________________________
  COMPUTATIONAL FLUID    Computational fluid dymanics models enable aerospace
  DYNAMICS               engineers to simulate the flow of air and fluid
                         around and through proposed structures and components.
                         For instance, engineers can simulate the performance
                         of aircraft and other aerospace vehicles in a wind
                         tunnel.  In addition, the performance of other
                         components, such as engines and electrical systems,
                         are simulated using this application.  Prior to
                         supercomputers, engineers primarily evaluated
                         aerodynamic designs by testing physical models in wind
                         tunnels and assessing the aircraft during actual
                         flight tests.  However, by using a supercomputer,
                         engineers can determine the effectiveness of an
                         aerodynamic design and make modifications before
                         constructing physical models.
</p>
<p>                         Boeing Aircraft Company, for example, used
                         computational fluid dynamics extensively in the
                         design of its newest commercial airplane, the Boeing
                         777.#4  The company&#x27;s chief researcher in
                         aerodynamics attributes a faster and more efficient
                         design of this airplane to using computational fluid
                         dynamics on a supercomputer.  Those engineers
                         designing the shape of the airplane and those studying
                         its aerodynamics were able to work on the same model
                         simultaneously prior to constructing physical models.
                         Before the use of a supercomputer, these two efforts
                         were done sequentially, relying on physical models and
                         actual wind tunnel tests, which added months to the
                         process.
</p>
<p>                         Boeing was also able to make a computer-generated
                         model of the Boeing 777, rather than a physical model,
                         available to potential customers during the design
                         process.  As a result, customer requests for changes
                         were more easily accommodated.  For example, one
                         request made during the design phase caused Boeing to
                         redesign a fold in the airplane&#x27;s wings so that the
                         wing tips would raise, allowing the airplane to fit
                         through existing airport gates.  Using computational
                         fluid dynamics on a Cray Y-MP supercomputer, Boeing
                         engineers quickly evaluated three potential designs
                         and identified the configuration with the right
</p>
<p>                         ______________________________________________________
                              4  Boeing announced the development of the 777
                         aircraft in 1990 and plans to make its first delivery
                         in 1995.
</p>
<p>  Page 18                GAO/IMTEC-91-58 Supercomputers and High-Speed Networks
</p>
<p>  _____________________________________________________________________________
                         Appendix III
                         The Aerospace Industry
</p>
<p>  _____________________________________________________________________________
                         balance of aerodynamic efficiency, structural weight,
                         and cost.  Boeing&#x27;s confidence in the results is
                         evidenced by the fact that it committed the wing
                         design to production before conducting physical wind
                         tunnel tests.
</p>
<p>                         In addition, Lockheed Aeronautical Systems Company
                         used computational fluid dynamics on a Cray X-MP
                         supercomputer to develop a computer model of the
                         Advanced Tactical Fighter for the U.S. Air Force.  In
                         about 5 hours of processing time, Lockheed simulated
                         the fighter&#x27;s performance using a full-vehicle
                         computer model to obtain aerodynamic data that is
                         normally only provided through actual wind tunnel
                         testing.  By using the supercomputer simulations,
                         Lockheed shortened the development phase of the
                         prototype fighter by several months and reduced the
                         amount of traditional wind tunnel testing by 80 hours.
                         The latter resulted in savings of about a half
                         million dollars.
</p>
<p>                         McDonnell Douglas found that using computational
                         fluid dynamics on a supercomputer to simulate the
                         performance of the C-17 military aircraft reduced
                         design and wind tunnel testing time.  Engineers used
                         this application to analyze 76 potential wing
                         configurations and identify the best three designs.
                         Thus, they only had to conduct traditional wind tunnel
                         tests on the final three designs.  This complete
                         process required 9 months and 350 hours of wind tunnel
                         testing.  In contrast, designing the wings of the DC-
                         10 commercial airplane without using this
                         supercomputer application, took 2 years and required
                         1,200 hours of wind tunnel testing on more than 50
                         designs.
</p>
<p>  #####################________________________________________________________
  STRUCTURAL ANALYSIS    Aerospace companies also use supercomputers to
                         analyze the structure of aircraft and other aerospace
                         vehicles and components to determine optimum weight,
                         shape, and composition.  Structural analysis
                         applications simulate the stresses and strains on a
                         given object that result from applied pressure or
                         loads.  The structure of an object, such as an
                         aircraft, is first defined as a grid of elements
                         representing its shape and composition.  Engineers can
                         then use the model to ascertain the effects of
                         pressure and loads on each element of the structure
                         (e.g., metal fatigue).  The supercomputer permits the
                         analysis to be done quicker and more often than
                         performing physical tests on actual structures.
</p>
<p></p>
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<p>  _____________________________________________________________________________
                         Appendix III
                         The Aerospace Industry
</p>
<p>  _____________________________________________________________________________
                         McDonnell Douglas engineers, for example, uncovered
                         and corrected a helicopter fan design flaw in 2 days
                         on their Cray X-MP supercomputer, after spending 6
                         weeks trying to uncover the problem using other
                         computers.  The design flaw concerned the level and
                         location of stress experienced within the helicopter
                         fan hub when spinning.  (A fan hub looks similar to a
                         wheel on an automobile and generates air flow inside
                         the tail of a helicopter.)  Using structural
                         analysis, engineers were able to identify the fan
                         hub&#x27;s high-stress areas and make the necessary design
                         modifications.
</p>
<p>  #####################________________________________________________________
  COMPUTATIONAL          Supercomputers have also been used to simulate
  ELECTROMAGNETICS       the electromagnetic characteristics of military
                         aircraft to make them more difficult to detect using
                         radar.  The supercomputer models the chemical
                         composition of the aircraft&#x27;s outer surface, the
                         geometry of the aircraft, and the reflections of
                         electromagnetic waves off the aircraft&#x27;s outer
                         surface.
</p>
<p>                         Lockheed Aeronautical Systems Company, for example,
                         reduced the radar signature (the size of an image
                         appearing on a radar display) of a low-observable,
                         stealth-like military aircraft, using computational
                         electromagnetics on Cray X-MP and Cray Y-MP
                         supercomputers.  This reduced the signature
                         substantially beyond what had been previously obtained
                         using other means.  As a result, Lockheed was able to
                         construct fewer physical models and conduct fewer
                         physical electromagnetic tests at a savings of $4.4
                         million and $1.5 million, respectively.
</p>
<p></p>
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<p>  Appendix IV
  _____________________________________________________________________________
  THE AUTOMOBILE INDUSTRY
</p>
<p>  _____________________________________________________________________________
                         Automobile manufacturers have been using
                         supercomputers increasingly since 1984 as a design
                         tool to make cars safer, lighter, more economical, and
                         better built, with significant time and dollar
                         savings.  By 1989, each of the 12 largest automobile
                         companies worldwide had acquired one or more Cray
                         supercomputers.  These supercomputers are enabling
                         automotive engineers to create increasingly
                         sophisticated and realistic simulation models to
                         design and test future vehicles.  It would be
                         impractical to perform many of these simulations, such
                         as large three-dimensional models, on anything less
                         powerful than a supercomputer.
</p>
<p>                         Although commercial supercomputer software is
                         available for most automotive applications, much of
                         this software originated from federally-supported
                         research.  For example, KIVA, a computer program
                         developed at Los Alamos National Laboratory, is used
                         to model, in three dimensions, the interactions of air
                         and liquids flowing through an engine.  NASTRAN,
                         developed under the sponsorship of NASA, is used to
                         analyze various automobile structures.  DYNA3D,
                         developed at Lawrence Livermore National Laboratory,
                         is used to simulate car crashes.  Commercial vendors
                         and the automobile companies have also modified these
                         applications to meet specific needs of the automobile
                         industry.
</p>
<p>                         Although no companies reported owning massively
                         parallel supercomputers, some of these companies were
                         exploring the potential of this new technology.  Some
                         company representatives indicated that massively
                         parallel supercomputers will be important in order to
                         process larger and more complex models, particularly
                         for crash analysis and computational fluid dynamics.
</p>
<p>                         The primary applications used by the automobile
                         industry are automobile crash analysis, structural
                         analysis, and computational fluid dynamics.  The five
                         companies we contacted--both American and Japanese--
                         reported that these applications have had a moderate
                         to great impact on improving product quality, reducing
                         costs, and performing previously intractable tasks.
                         According to a Ford Motor Company representative, the
                         intense competitiveness of the industry has made it
                         necessary to use a supercomputer.  A Nissan Motor
                         Company representative also stated that Nissan would
</p>
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<p>  _____________________________________________________________________________
                         Appendix IV
                         The Automobile Industry
</p>
<p>  _____________________________________________________________________________
                         not consider developing automobiles without a
                         supercomputer.
</p>
<p>  #####################________________________________________________________
  AUTOMOBILE CRASH       Crash analysis is one of the primary applications for
  ANALYSIS               supercomputers in the automotive industry because it
                         provides an alternative to physically crashing test
                         vehicles.  The primary advantage of modeling a crash
                         on a supercomputer is that more data about the crash
                         is produced at a cost and within a time frame that
                         would be otherwise impossible to achieve.  For
                         example, crash simulations can show how the vehicle
                         structure will collapse during a crash, how fast the
                         driver and passengers will move forward during impact,
                         and when air bag sensors will be activated.
</p>
<p>                         Initially, vehicle crash simulations involved
                         modeling a half-car frontal crash.  Today&#x27;s models
                         have become more complex, involving full vehicle
                         crashes, two full vehicle crashes, and side impact
                         crashes.  Using these models, companies can then
                         compare many more designs and optimize a vehicle&#x27;s
                         structure for weight, stiffness, and strength before a
                         full prototype vehicle is crash tested.
</p>
<p>                         Physical crash tests require prototype vehicles,
                         which are time- consuming and expensive to
                         manufacture.  According to one automobile company,
                         each test costs between $50,000 and $750,000,
                         depending on whether a production vehicle or a
                         prototype is used.  In addition, a prototype vehicle
                         can take as long as 8 months to manufacture.  In
                         contrast, full car crash simulations can be processed
                         on a supercomputer in less than 20 hours.
</p>
<p>                         According to General Motors Corporation (GM)
                         representatives, crash testing prototype vehicles has
                         been substantially reduced as a result of
                         supercomputing.  In testing passenger restraint
                         devices, such as seat belts, during the development of
                         some of its 1992 automobiles, GM crashed about 100
                         fewer vehicles than it did in 1987.  According to
                         company representatives, the reduction was largely due
                         to crash simulations on a Cray supercomputer.
</p>
<p>                         In addition, the Saturn Corporation, a subsidiary of
                         GM, estimated that they performed over 100 vehicle
                         crash simulations on a supercomputer between 1986 and
                         1990.  Data obtained from these simulations were then
                         used to modify the design of the vehicles.  As a
                         result, Saturn reported a savings of more than $2
                         million in development and test costs.
</p>
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<p>  _____________________________________________________________________________
                         Appendix IV
                         The Automobile Industry
</p>
<p>  _____________________________________________________________________________
</p>
<p>  #####################________________________________________________________
  STRUCTURAL ANALYSIS    Automobile companies use structural analysis
                         models to simulate the physical structure of an
                         automobile, including parts and components, to
                         improve functionality and reduce manufacturing costs.
                         The simulations help engineers design stronger parts
                         that are lighter and less susceptible to problems
                         caused by vibration and stress.  Lighter parts also
                         contribute to improvements in fuel economy.
</p>
<p>                         Chrysler Corporation improved the design of a small
                         car&#x27;s body structure and a convertible&#x27;s floor
                         structure by modeling them on a Cray X-MP
                         supercomputer.  The stiffness of the small car body
                         structure was improved by 10 percent, while its weight
                         was reduced by 45 pounds.  The improvement in body
                         stiffness on the small car made the vehicle easier to
                         handle and gave it a better ride.  The floor of the
                         convertible was lengthened by 8 percent, yet reduced
                         in weight by 9 pounds.  Chrysler estimates that it
                         will save about $3.9 million annually in reduced raw
                         materials to manufacture both vehicles.
</p>
<p>                         Chrysler was also able to eliminate the need for a
                         dash board bracket in a new minivan by modeling the
                         dash board structure on a Cray X-MP supercomputer.
                         The model showed that the remaining dash board
                         brackets were sufficient to hold the dash board
                         structure in place.  Chrysler estimates that the
                         elimination of the $2 bracket will save about $940,000
                         annually in the cost of parts to manufacture the
                         vehicle.
</p>
<p>                         In addition, Chrysler improved the design of a new 2.0
                         liter engine by modeling its structure on a Cray X-MP
                         supercomputer.  The stiffness, or rigidity, of the
                         engine structure was increased by 3 percent, thus
                         contributing to a smoother running engine.  In
                         addition, its overall weight was reduced by 9 pounds.
                         Chrysler estimates that it will save about $1.8
                         million annually in reduced raw materials to
                         manufacture the engine.
</p>
<p>  #####################________________________________________________________
  COMPUTATIONAL FLUID    Computational fluid dynamic models are used to
  DYNAMICS               simulate the flow of air or liquids around or through
                         automobile parts or structures.  Specifically, models
                         simulate the exterior flow of air around a vehicle,
                         the flow of air within the vehicle, and the flow of
                         air and liquids within the engine, cooling system, and
                         air conditioning system.
</p>
<p>                         At Chrysler Corporation, for example, engineers used a
                         Cray X-MP supercomputer to simulate the flow of
</p>
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<p>  _____________________________________________________________________________
                         Appendix IV
                         The Automobile Industry
</p>
<p>  _____________________________________________________________________________
                         liquids through the cooling system of one of its
                         vehicles.  This analysis helped determine which design
                         was most efficient in cooling the vehicle&#x27;s engine.
                         Thus, the design of the system was optimized to
                         improve its cooling efficiency while reducing the
                         number of needed parts.  Chrysler estimates that this
                         reduction will reduce manufacturing costs by about 5
                         percent, saving about $1.6 million annually.
</p>
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<p>  Appendix V
  _____________________________________________________________________________
  THE CHEMICAL AND PHARMACEUTICAL INDUSTRIES
</p>
<p>  _____________________________________________________________________________
                         The chemical and pharmaceutical industries are the
                         fastest-growing group of industrial supercomputer
                         users, although their use is still in its infancy.
                         The impetus for these industries to begin using
                         supercomputers was a combination of recent advances in
                         theoretical chemistry and three-dimensional
                         visualization techniques.  Du Pont became the first
                         company in these industries to buy a vector
                         supercomputer in 1986.  Since then, several other
                         American and Japanese companies have begun using
                         supercomputers.  Two companies--Dow Chemical Company
                         and Eli Lilly &amp; Company--are now experimenting with
                         massively parallel supercomputers.  Lilly is using a
                         supercomputer at the National Center for
                         Supercomputing Applications--a NSF supercomputer
                         center at the University of Illinois--to develop code
                         to be used on massively parallel supercomputers.
</p>
<p>                         Some of the important chemical software applications
                         used today were derived from applications developed at
                         government laboratories, such as NASA Ames Research
                         Center.  However, little application software has been
                         available until very recently, because the chemical
                         industry only recently began using supercomputers.  In
                         order to develop sophisticated application software on
                         a reduced, shared-cost basis, Cray Research, Inc.,
                         other vendors, chemical companies, and government
                         laboratories have formed a chemical software
                         consortium.  Member companies include Lilly, Monsanto
                         Company, Exxon Research and Engineering, Du Pont, and
                         3M Corporation.
</p>
<p>                         The major supercomputer applications in the chemical
                         and pharmaceutical industries include molecular
                         modeling, structural analysis, and computational fluid
                         dynamics, and are used in basic research, product
                         development, manufacturing process design,
                         manufacturing plant design, environmental impact
                         assessment, and waste disposal.  Thus, supercomputing
                         affects many stages of the industry&#x27;s product lines.
                         These product lines number in the thousands and
                         include industrial chemicals, polymers,#5 and
                         biological materials for agriculture and medicine.
                         All company representatives reported that the use of
</p>
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<p>                         ______________________________________________________
                              5  A chemical compound or mixture of compounds
                         containing repeated structural units of the same
                         original molecules, such as Nylon.
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<p>  _____________________________________________________________________________
                         Appendix V
                         The Chemical and Pharmaceutical Industries
</p>
<p>  _____________________________________________________________________________
                         supercomputers greatly helps them perform previously
                         intractable tasks--such as the study of complex
                         molecules.  Several representatives also said that
                         supercomputers helped them reduce cost and time to
                         market, improve quality, and develop a greater variety
                         of products.
</p>
<p>  #####################________________________________________________________
  MOLECULAR MODELING     Molecular simulations enable scientists to study the
                         molecular properties of chemical compounds used in the
                         development of drugs and other products.  One of the
                         keys to understanding molecules lies in gaining a
                         clear appreciation of their three-dimensional shape.
                         Unlike the rigid &quot;ball and stick&quot; models that
                         scientists built in the past, the atomic positions in
                         a molecule are constantly changing.  Using
                         supercomputers in conjunction with workstations,
                         scientists are able to construct images, such as
                         those of large, complex human proteins and enzymes.
                         Scientists can then rotate these images to gain clues
                         on biological activity and reactions to various drug
                         candidates.
</p>
<p>                         The use of molecular modeling has also been
                         important, from an economic perspective, in the
                         development of new drugs.  A Du Pont scientist
                         estimated that about 30,000 compounds are
                         synthesized--at a cost of about $5,000 per synthesis
                         and initial screening--for every new drug that is
                         developed.  As such, as much as $150 million can be
                         invested in discovering a drug, even before clinical
                         testing, federal government approval, and
                         manufacturing and development costs are added.  By
                         making this drug discovery process more &quot;rational,&quot;
                         with less trial and error, a Du Pont representative
                         estimates that millions of dollars can be saved.
</p>
<p>                         Du Pont is currently developing replacements for
                         chlorofluorocarbons, compounds used as coolants for
                         refrigerators and air conditioners, and as cleansing
                         agents for electronic parts.  These compounds are
                         being phased out because they are thought to
                         contribute to the depletion of ozone in the
                         atmosphere.  Du Pont is designing a new process to
                         produce substitute compounds safely and cost-
                         effectively.  These substitutes will be more reactive
                         in the atmosphere and will decompose faster.  Du Pont
                         is using a supercomputer to calculate the
                         thermodynamic data needed for developing this process.
                         These calculations can be completed by the
                         supercomputer in a matter of days, at an approximate
                         cost of $2,000 to $5,000.  Previously, such tests were
                         conducted in a laboratory, and required up to 3 months
                         to conduct, at a cost of about $50,000.  Both the
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<p>  _____________________________________________________________________________
                         Appendix V
                         The Chemical and Pharmaceutical Industries
</p>
<p>  _____________________________________________________________________________
                         cost and time required for such traditional methods
                         would have substantially limited the amount of testing
                         that is now being done.
</p>
<p>  #####################________________________________________________________
  STRUCTURAL ANALYSIS    Computer-based structural analysis techniques are used
                         in the chemical and pharmaceutical industries to
                         determine stress and durability of both products and
                         processing equipment.  For example, Du Pont engineers
                         used structural analysis to optimize the design of a
                         mold used in a new process for manufacturing Corian#6
                         sinks.  This enabled them to quickly determine the
                         wall thicknesses, ribbing, and reinforcements
                         necessary to withstand the molding pressure while
                         minimizing its weight.  Thus, this application enabled
                         them to develop the manufacturing process 6 to 12
                         months sooner than would have been possible using a
                         series of prototype molds.  This saved development
                         costs and increased revenue by getting the new process
                         in operation faster.
</p>
<p>  #####################________________________________________________________
  COMPUTATIONAL FLUID    The chemical and pharmaceutical industries use
  DYNAMICS               computational fluid dynamics to model products and
                         product performance, and to aid in the design of
                         manufacturing processes and plants.  These models
                         predict how fluids flow through equipment and can
                         simulate processes, such as mixing, drying, cooling,
                         and separation.  For example, Du Pont has successfully
                         used this application on a Cray Y-MP supercomputer to
                         model manufacturing processes for sheet products, such
                         as film and plastic wrappers.  These products,
                         particularly X-ray film, must be uniform in thickness
                         to meet the required quality standard.  Thus,
                         computational fluid dynamics provides Du Pont with an
                         additional design tool to improve sheet product
                         thickness uniformity, without increasing manufacturing
                         time.
</p>
<p>                         Du Pont also models the manufacturing process for
                         Nylon, one of its major products.  Computational fluid
                         dynamics solutions to these models accurately quantify
                         the flow through the processing equipment and locates
                         where clogging is most likely to occur.  Clogging is a
                         major problem in Nylon plants, causing periodic
                         shutdowns.  By modeling the process, Du Pont has been
                         able to reduce the number of shutdowns.
</p>
<p></p>
<p></p>
<p></p>
<p>                         ______________________________________________________
                              6  Corian is a registered trademark of E.I. du
                         Pont de Nemours and Company.
</p>
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<p>  Appendix VI
  _____________________________________________________________________________
  COMPANIES INTERVIEWED REGARDING
  SUPERCOMPUTER USE
</p>
<p>  _____________________________________________________________________________
  Aerospace Companies    The Boeing Company, Seattle, Washington
                         General Dynamics Corporation, Fort Worth, Texas
                         Grumman Corporation, Bethpage, New York
                         Lockheed Corporation, Calabasas, California
                         McDonnell Douglas Corporation, Hazelwood,    Missouri
                         Pratt &amp; Whitney, United Technologies   Corporation,
                         East Hartford, Connecticut
</p>
<p>  _____________________________________________________________________________
  Automobile Companies   Chrysler Corporation, Highland Park, Michigan
                         Ford Motor Company, Dearborn, Michigan
                         General Motors Corporation, Warren, Michigan
                         Honda Motor Company, Ltd., Tokyo, Japan
                         Nissan Motor Company, Ltd., Tokyo, Japan
</p>
<p>  _____________________________________________________________________________
  Chemical and           Dow Chemical Company, Champaign, Illinois
  Pharmaceutical         E.I. du Pont de Nemours and Company, Wilmington,
  Companies              Delaware
                         Eli Lilly &amp; Company, Indianapolis, Indiana
                         Merck &amp; Company, Rahway, New Jersey
                         Monsanto Company, St. Louis, Missouri
</p>
<p>  _____________________________________________________________________________
  Petroleum Companies    Amoco Production Company, Tulsa, Oklahoma
                         Atlantic Richfield Company (ARCO), Plano, Texas
                         British Petroleum (BP), Houston, Texas
                         Chevron Corporation, Houston, Texas
                         Exxon Production Research Company, Houston, Texas
                         Oryx Energy Company, Dallas, Texas
                         Phillips Petroleum Company (Phillips 66),
                         Bartlesville, Oklahoma
                         Shell Oil Company, Houston, Texas
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<p>  Appendix VII
  _____________________________________________________________________________
  COMPANIES INTERVIEWED REGARDING HIGH-SPEED
  NETWORK USE
</p>
<p>  _____________________________________________________________________________
                         Amoco Production Company, Houston, Texas
                         Apple Computer, Inc., Cupertino, California
                         General Motors Research Corporation, Warren, Michigan
                         Hewlett-Packard Company, Cupertino, California
                         Intel Corporation, San Jose, California
                         International Business Machines Corporation, Austin,
                           Texas
                         Landmark Graphics Corporation, Houston, Texas
                         Schlumberger Well Services, Houston, Texas
                         Sun Microsystems, Inc., Milpitas, California
                         Tandem Computers, Inc., Cupertino, California
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<p>  Appendix VIII
  _____________________________________________________________________________
  MAJOR CONTRIBUTORS TO THIS REPORT
</p>
<p></p>
<p></p>
<p>  #####################________________________________________________________
  INFORMATION            Linda D. Koontz, Assistant Director
  MANAGEMENT AND         Valerie C. Melvin, Assignment Manager
  TECHNOLOGY DIVISION,   Beverly A. Peterson, Evaluator-in-Charge
  WASHINGTON, D.C.       Nancy M. Kamita, Computer Scientist
</p>
<p>  #####################________________________________________________________
  LOS ANGELES REGIONAL   Allan Roberts, Assistant Director
  OFFICE                 Ambrose A. McGraw, Regional Assignment Manager
                         Benjamin H. Mannen, Senior Evaluator
                         Shawnalynn R. Smith, Staff Evaluator
</p>
<p>  #####################________________________________________________________
  SAN FRANCISCO          Frank Graves, Regional Assignment Manager
  REGIONAL OFFICE        Don Porteous, Staff Evaluator
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