Don't forget that these groups (as the author calls it "skunkworks" - which I believe is a braintank at McDonnald Douglas) are very, very small. Usually 5 to 10 people. They produce a so-called prototype. If that works and is accepted by management, then the development houses take over. And unlike of what the layman thinks, a development house consists only to 10 - 15% of programmers (the people that write the actual code). The rest are testing, product assurance , publication, integration, planning, market research, standards, forecasting, pricing, lawyers, external interfaces (especially at MS who have to deal with a gezillion hardware and software vendors), several layers of management, etc. etc. (there are about 10 more I can think of). And if that big group of hundres of people starts working, then it gets serious and expensive. Make your own calculation: The total development house (all people considered) runs at about 1000 lines of code per manyear. A new operating system will be at least 10 to 20 million lines of code (Vista is 55 Mlocs). A manyear costs anywhere from 100 to 150K$. This is serious business and will not be decided on the back of an envelope.