How RCA Lost the LCD

January 8, 2013 3:18 PM

RCA owned the early patents but failed to commercialize the liquid crystal display
posted by Confess, Fletch (19 comments total)

Fascinating; thanks for the post. tl;dr: "Freedman was a forceful manager who insisted on maintaining complete control over all aspects of his projects. This approach proved disastrous for the LCD, because it alienated personnel whose support was needed to nurture the emerging technology." Freedman, of course, kept his job when it all went to crap. Yay, management!
posted by languagehat at 3:32 PM on January 8 [4 favorites]

IEEE Spectrum is seriously the best magazine out there right now. Well, it's like in the top 5. But it's 2.4 GHz of awesome.
posted by GuyZero at 3:47 PM on January 8 [2 favorites]

Yeah, it's hard not to read between the lines in the narrative and see the established divisions of a major company ensure the new innovative wing is kept on a short leash so that it doesn't disrupt their status and sales.

But then you reach this part of the narrative:

> Around the time that it introduced LCDs to the public, RCA was also negotiating agreements with a number of European and Japanese TV makers that wanted to license its patents related to the manufacture of color cathode ray tubes. As an inducement, RCA executives would offer licenses on some of its new inventions, including the LCD. [...] Despite frustration among RCA researchers that others were capitalizing on their ideas, company leaders expressed no concern that such arrangements might foster the emergence of new competitors.

And decide that maybe this was purely the product of executive capriciousness or indifference. Without having been there, we'll probably never know.
posted by ardgedee at 3:52 PM on January 8

Ha! Already in the late 50s the Mets were only good as a punchline. Plus ça change.
posted by Joey Buttafoucault at 3:54 PM on January 8

Another RCA tragedy was the VideoDisc, RCA's attempt at putting home video on a vinyl disc. It missed its intended launch date by years, finally being released after Beta and VHS, at which time it was already obsolete. There were engineers that spent 17 years of their life on that project, all for nothing.
posted by gngstrMNKY at 3:55 PM on January 8 [3 favorites]

But it's 2.4 GHz of awesome.

DC to 2.4GHz. Why do you think it's called Spectrum?
posted by eriko at 3:57 PM on January 8

There did seem to be a pattern of big American tech companies (ATT, Xerox, IBM) around that time who came up with great inventions but couldn't seem to get them out the door.
posted by octothorpe at 4:18 PM on January 8

There did seem to be a pattern of big American tech companies (ATT, Xerox, IBM) around that time who came up with great inventions but couldn't seem to get them out the door.

It wasn't limited to that time, and I'm sure it isn't limited to American Tech companies.

A decade ago, I worked for Microsoft. I went to the Microsoft Research tech expo three years in a row. Every year, they showed mostly the same things, desperate for one of the product groups to pick their work up and commercialize it. It never happened.

It is easy to see that, in hindsight, RCA should have aggressively productized the LCD. But it is much harder to tell at the time. When you have limited resources - and everyone does - you have to prioritize. You make the best decisions you can. In hindsight, it is often clear that a different decision would have been better.

The Venture Capital model tries to fix this, and does a moderately good job, but it isn't perfect either. Except when it comes to methods and processes for creating and posting pictures of cats.
posted by b1tr0t at 4:32 PM on January 8 [3 favorites]

RCA also dropped the ball on videotape, despite it being a personal hobby horse of David Sarnoff. It was startup Ampex that figured out how to move the heads fast across a wide slow tape instead of running the tape at 30 feet per second. Then, of course, Ampex dropped the ball themselves by refusing to move their designs to semiconductor technology.
posted by localroger at 4:35 PM on January 8 [2 favorites]

Ironically, while I was at Microsoft, Bill Gates kept going on and on about how Tablets Were The Future.

But it took Steve Jobs to make it happen. And even now, the Surface tablet looks like it will be a flop, or at least a very minor success.
posted by b1tr0t at 4:39 PM on January 8

There did seem to be a pattern of big American tech companies (ATT, Xerox, IBM) around that time who came up with great inventions but couldn't seem to get them out the door.

Do you think that's really any different than today? Big companies can afford to fail (especially if they fail cheaply) and can't afford to take huge risks. Many small companies, on the other hand, can go all in on a product and most will fail, but you never remember those. You remember the ones that succeed.
posted by aspo at 4:41 PM on January 8 [1 favorite]

Big companies can afford to fail (especially if they fail cheaply) and can't afford to take huge risks.

Many big companies believe that they need to launch new products on the same scale as old products. That makes new initiatives into big, expensive risks.

Google is a counter example (except for g+). Google often launches new features, but you never hear about them if they don't take off. But that also means that you never hear about the ones that don't succeed, unless you follow Google closely. Whether this ends up improving their bottom line, or just employee morale (which reduces attrition and hiring costs, so indirectly the bottom line) remains to be seen.

Entirely new brands and production partnerships can also help. Toyota spent a lot of effort building a brand around low cost and reliability in the US. So when they decided to add luxury products, they created the Lexus brand. And when they decided to go more aggressively after the youth market, they launched Scion. When they recently decided to re-enter the sports car market, they partnered with Subaru and launched the resulting new vehicle under the Scion label (and Subaru launched their own version under their own brand, having already established themselves as leader in the non-luxury sports car segment).
posted by b1tr0t at 5:46 PM on January 8

Do you think that's really any different than today? Big companies can afford to fail (especially if they fail cheaply) and can't afford to take huge risks. Many small companies, on the other hand, can go all in on a product and most will fail, but you never remember those. You remember the ones that succeed.

This is one of the central ideas of The Innovator's Dilemma. I don't do a whole lot of business reading, but TID is pretty interesting stuff.
posted by jquinby at 6:00 PM on January 8

Ha! Already in the late 50s the Mets were only good as a punchline.

Seems unfair, given that they didn't even start playing until 1962.
posted by Horace Rumpole at 6:21 PM on January 8

This is an old story repeated over and over at technology companies. If you are a young scientist or engineer, never, never go into your boss' office and tell him you have a new invention that will do the same thing you are doing now for one-tenth the price -- unless you want to give him a heart attack and get thrown out, because you are just telling him you have a way of cutting the company's revenue by a factor of ten. Management always fears cannibalization of their expensive, high profit products and will resist demotion to a cheap commodity product. But, as has happened over and over, if they don't do it, eventually their competitors will, and by then it is too late to respond.
posted by JackFlash at 7:37 PM on January 8

I'm not normally into the cult of the superstar CEO, but it seems like RCA disintegrated pretty much when Sarnoff's health failed.
posted by Ickster at 9:16 PM on January 8

Going to be very interested to read this because my husband used to work for Sarnoff (the old RCA Labs). I used to pick him up for lunch and when I'd go in, there were a bunch of Emmys for technical work in television in the lobby. I didn't know they held the LCD patents until he worked there.
posted by immlass at 11:12 PM on January 8

I worked for RCA in Moorestown, NJ back in the early 1980s. It was a combination of a tremedously talented technical staff and a bureaucracy that would put the best-run companies in the Soviet Union to task. Nothing got done quickly and the union work rules were utterly stifling. I could not change the position of a daisy-chain without FILLING IN A REQUEST and giving it to the IBEW to do it. "It takes a long time to debug a circuit when you can't actually put your hands on it," I remember saying to my boss. "I know. Just follow the shop rules. I can't have any more grievances filed on this project. The schedule is not my problem."

So this article rings true for me:

Then, in 1962, RCA researcher Richard Williams hit upon the idea of using the crystals in some type of display, and he succeeded in getting the material to electronically modulate the passage of light. Fifty years ago this month, Williams filed for what would become RCA’s first patent on the new technology.

Any patents filed in 1962 would have been processed fairly quickly so they were probably issued in 1963 (when a U.S. patent was valid for 17 years after grant) so this fundamental patent would have expired in 1980.

Shortly before the establishment of the Raritan plant, however, company officials decided that the liquid crystal project needed a more formal management structure. In place of Murray and his laissez-faire style, they named Norman Freedman, who had helped design the assembly lines that produced the first color television tubes.

And then the glacial pace of RCA's bureaucracy killed any advantage getting the early patents might have gained them.

The Raritan engineers delivered all three products on time. Still, RCA executives continued to deny the group funding, which worried members of Klein’s team, as did the company’s unwillingness to endorse what Klein and Heilmeier felt was an obvious LCD product: the electronic wristwatch.

So they really had it right. By the mid-1970s all sorts of cool LED wristwatches were just coming out on the market, but it wasn't until the 1980s (when RCA's patents began to expired) that LCD technology started to replace the LED.
posted by three blind mice at 3:46 AM on January 9

In trying to find more documentation and pictures of the early LCD work, I found Benjamin Gross' entire PhD dissertation, which is a lot more comprehensive than his IEEE Spectrum article. 321 pages!

I also didn't know you could get a PhD in the History of Science. That's awesome.
posted by JoeZydeco at 9:53 AM on January 9 [1 favorite]