The very knowledge that it was possible to record a conversation would "greatly restrict the use of the telephone," with catastrophic consequences for its business.
November 26, 2010 11:32 AM   Subscribe

"In the United States, the higher consumer prices resulting from monopoly amounted, in effect, to a tax on Americans used to fund basic research." But no 'Disruptive Technology', please. A look at the 'dark side' of Bell Labs and why magnetic recording was NOT developed there in the 1930s (thanks to one of the worst tech predictions ever).

And, yes, it's a misleading title, since it didn't take 60 years for magnetic recording or even Answering Machines to hit the market; just 60 years until Bell's stopping the research became public. That and a couple more errors and irregularities are addressed well in the comments.
posted by oneswellfoop (42 comments total) 14 users marked this as a favorite

 
Magnetic recording was developed in 1888.
posted by entropicamericana at 11:57 AM on November 26, 2010 [1 favorite]


Corporations - always looking out for our best interests. They deserve our trust!
posted by amethysts at 12:03 PM on November 26, 2010 [4 favorites]


wait till you guys hear about the car that runs on water.
posted by quonsar II: smock fishpants and the temple of foon at 12:37 PM on November 26, 2010


Corporations - always looking out for our best interests. They deserve our trust!

That's about as insightful as saying "Governments - always looking out for our best interests. They deserve our trust!" in the TSA thread.
posted by ripley_ at 12:55 PM on November 26, 2010


There was a big gap between these inventions and the market viability of these innovations. Take a look at iPad. It wasn't until the last year or so that flash memory, touch screens and batteries got cheap enough to make this a viable commercial product. Also as we saw with Newton vs. Palm one unready technology (e.g. the handwritting recognition technology), can make even a good product miss the mark.
My point is that as soon as these technologies really got to the commodity price point, they took off. I don't think that the companies in question had much to do with stifling innovation. Consider Apollo. We spent billions to get to the moon, but it wasn't at a price and risk that we could reasonably go back on any kind of schedule.
Consider amorphous silicon solar cells. This technology is set to lower the cost to less than $1/watt for solar cells if we can eek out a couple more % efficiency and get the right economy of scale. To do this though requires lots of breakthroughs in the

One of the more interesting things I've read on this recently has been the road-map for Algae Bio-fuels. This is a big government research chart to figure out how to make algae bio-fuels commercially viable. Even though the theoretical basis for algae to be our future fuel source has been known for 30 years it has only been in the last 2-3 that we've developed the right drying system, self cleaning closed loop system and understood how to protect monocultures well enough to have a shot at this working.

Thus in conclusion neener neener neener bell labs / PARC /etc 4ever!
posted by humanfont at 12:55 PM on November 26, 2010 [1 favorite]


Everybody wants basic research, but no one wants to fund it. Bell just made it look like the public wasn't paying for it. There's no question this approach works, but it carries its own costs.
posted by tommasz at 12:56 PM on November 26, 2010 [3 favorites]


Actually, I think a tax on Americans used to fund basic research doesn't sound all that bad, given some of the things that Bell Labs produced. I've always thought that it was unfortunate that when Ma Bell got broken up -- which was a good thing, in the net; it brought dirt-cheap telecommunications and probably helped the Internet revolution -- Bell Labs wasn't kept around, funded by a USF-like FCC fee. Sort of like DARPA, only working to advance civilian communications rather than defense applications.

I'm not entirely sure I buy the author's thesis about Bell's suppression of the answering machine; there were wire recorders available from the 1920s (and portable ones in the 30s and 40s); anyone who wanted to could have interfaced one to a phone, and I'm sure people did. There were answering machines which used wire recording technology available in the 30s (this article, which is unsourced, claims that they were "popular with Orthodox Jews who were forbidden to answer the phone on the Sabbath").

The real reason I suspect that answering machines didn't become popular when the technology to build them first became available was simple: the Depression killed the market before it could really exist.

There's an entire line of steampunk-esque speculation you can go down, imagining what the 20th century would have looked like if the Depression and World War Two had never happened. (Streamlinepunk?) There are a whole lot of technological advances that were begun in the 20s and 30s but never successfully commercialized until the 50s and 60s, because the Depression and the war threw everything into a cocked hat for a few decades. The answering machine is the least of it.

Some of the Bell System's other anti-progress machinations I have no trouble believing; they were an entrenched monopoly and entrenched monopolies tend to hate anything that looks even vaguely like disruptive change. But I don't know if that's really a "darker side to Bell Labs," it's just the unfortunate way that Bell Labs was funded. It's unfortunate that we threw the baby out with the monopolist bathwater.
posted by Kadin2048 at 1:05 PM on November 26, 2010 [4 favorites]


Sorry, here's the questionable article about answering machines which claims they were "popular" with Orthodox Jews.
posted by Kadin2048 at 1:06 PM on November 26, 2010


Yeah, I'm as opposed to the Bell monopoly, and as distrustful of corporations, as the next person, but I really have a difficult time believing that Bell held us back technologically.

Also, Kadin2048, I believe that the people who do that sort of speculation tend to call it "dieselpunk".
posted by sotonohito at 1:19 PM on November 26, 2010


Who knows if recording technology was delayed because of Bell Labs? We do know that the transistor came out of Bell Labs. That's all we need to know. Transistors are so much more important than some niche technologies.
posted by rdr at 1:25 PM on November 26, 2010


For, in part, the privileges AT&T enjoyed as a government-sanctioned monopoly with government-set prices were understood as being offset by this contribution to basic scientific research, an activity with proportionately more direct government funding in most other countries.
Is this guy kidding? You don't think the US government was spending a ton on science in the middle of the cold war?
posted by delmoi at 1:56 PM on November 26, 2010


Didn't shockley quit to start his own transister firm because Bell wouldn't? Maybe there was a patent deal; brief wikipedia search doesn't turn much up on that end...
posted by pwnguin at 1:59 PM on November 26, 2010


"But why would company management bury such an important and commercially valuable discovery? What were they afraid of? The answer, rather surreal, is evident in the corporate memoranda, also unearthed by Clark, imposing the research ban. AT&T firmly believed that the answering machine, and its magnetic tapes, would lead the public to abandon the telephone."

Clark evidently found the documents that implemented the ban on this research, as well as the reasoning behind it.

Sounds like a slam dunk case of corporate suppression to me. And it's a clear indictment of the "monopoly innovation" idea. Sure monopolies can and do innovate. They simply don't act in the public interest when the management perceives that interest to be at odds with their own. Not exactly surprising, and it's no secret, either. It's always about the shareholders. Of course, in hindsight, we can see that they screwed their shareholders out of potentially massive gains, but there is really no way to know that at the time.

AT&T's management was correct about the potential abuses of the recording technology; what they miscalculated was the consumer's reaction to it. Mark Zuckerberg and P.T. Barnum have a better understanding of the consuming public, I am afraid.
posted by Xoebe at 2:05 PM on November 26, 2010 [2 favorites]


There was a big gap between these inventions and the market viability of these innovations. Take a look at iPad. It wasn't until the last year or so that flash memory, touch screens and batteries got cheap enough to make this a viable commercial product.
Oh come on man, People have been selling tablet PCs for ever. The thing with the iPad had more to do with the success of the iPhone and the fact that Apple spent a ton on marketing. There's obviously a tech threshold that makes these things compelling.
I'm not entirely sure I buy the author's thesis about Bell's suppression of the answering machine; there were wire recorders available from the 1920s (and portable ones in the 30s and 40s); anyone who wanted to could have interfaced one to a phone, and I'm sure people did.
Bell's monopoly was so strong that they actually restricted people from connecting anything they didn't own from touching their network. And yeah, that meant people didn't own their own phones, they rented 'em. So even if someone developed an answering machine, they wouldn't have been able to sell it.

(Maybe they could have made an acoustic coupler version, like early modems. In fact, the acoustic couplers on modems were a work around for bell's rules on what you could connect to the phone line)
posted by delmoi at 2:05 PM on November 26, 2010 [3 favorites]


The thing with the iPad had more to do with the success of the iPhone and the fact that Apple spent a ton on marketing.

If only their competitors would spend more money on marketing!
posted by entropicamericana at 3:02 PM on November 26, 2010 [4 favorites]


My husband used to work for Sarnoff, the old RCA Labs (or what was left of it after Jack Welch stripped off the useful patents). They were they guys who basically gave us color TV and LCD screens. I've read a bit of their whitewashed corporate history and clearly there was some at least somewhat hinky stuff in terms of patent grabs and suppression early on as the company came into its own. This article makes me wonder what kind of stuff RCA had hidden in the archives because it wasn't considered viable or desirable.
posted by immlass at 3:04 PM on November 26, 2010


If only their competitors would spend more money on marketing!

Apple is the largest computer maker in the world, so that's not really possible. And even it wasn't, they tend to put money into whatever Jobs wants to promote while other CEOs aren't as willing to take risks.
posted by delmoi at 3:25 PM on November 26, 2010


They were they guys who basically gave us color TV and LCD screens. I've read a bit of their whitewashed corporate history and clearly there was some at least somewhat hinky stuff in terms of patent grabs and suppression
I think they held back the color TV by decades or something like that.
posted by delmoi at 3:26 PM on November 26, 2010


Bell Labs licensed the transistor on very equitable terms to all comers because AT&T got hit by an anti-trust suit in 1949 and needed to be conspicuously good. Without that, there's a very good chance that we'd be twenty years behind - especially when you think that people like Sony cottoned on and learned how to make transistors right at the time they needed to (in Sony's case, by using a holed bucket filled with water, some string and a pulley, to pull crystals from melt).

I've always tried to keep an open mind about the patent system, despite an instinctive feeling that it really doesn't work properly. The more I learn about the history of ideas, though, the more I think it's actively harmful.
posted by Devonian at 3:35 PM on November 26, 2010 [1 favorite]


Who knows if recording technology was delayed because of Bell Labs?

It wasn't. They didn't even invent it -- that was BASF, though we didn't know that until well after WWII. The real trick to magnetic tape recording had nothing to do with the magnetic part, and everything to do with the tape part. The problem was tension, and the tape would fail -- this is why the first magnetic recording mechanisms used steel wire, not paper or plastic tape -- it wouldn't snap, and it didn't stretch much.

Dupont invented it, but it was 3M that figured out that BoPET (aka Mylar) was the ideal substrate for magnetic tape recording. And that was the trick -- reliable tape made reliable transports possible, and tape became the primary audio recording media, and later, video as well. By the late 1950s, tape was everywhere. You would think someone would have hooked one up to a phone, right?

Well, they did. The Ansaphone by Phontel was sold in the United States in 1960. It was expensive, because it was using new tech *and* had to meet WE's standards, but basically, once tape had become reliable, someone figured out how to hook it to a phone.

They'd done it before, but steel wire machines were expensive, troublesome, and most importantly, couldn't do anything like filing, typing, mailing, etc -- because even in a busy office, you didn't *need* someone to only answer the phone. Not phones, phone.

It wasn't until most homes and offices had a phone that people started calling frequently, thus, a need to answer the phone if you couldn't grew. However, businesses -- normally the driver for such things -- had people to answer the phone and take messages. The prices had to drop to where the SOHO and Home markets could afford the product before answering machines became common.

Finally, Bell Labs let out transistors and lasers, and suppressed answering machines? Ahem.
posted by eriko at 3:46 PM on November 26, 2010 [9 favorites]


My husband used to work for Sarnoff, the old RCA Labs.

David Sarnoff himself was a master of innovation, and not shy about leaning on competing technologies, like FM radio.
posted by ovvl at 3:50 PM on November 26, 2010


Bell Laboratories still exists, in reduced circumstances.
It is owned by Alcatel-Lucent (since 2006?) when a French company acquired the remains of Lucent, the fragment of the original ATT that got the labs.
The Wikipedia article seems fair, though it does not seem to know that the Whippany lab is out of business (and for sale--would you like an attractive campus in north-central NJ?).

Unix was invented at Bell Labs. Several of the folks who did that are now at Google. And pretty old.

ATT fought acoustic coupling to its network. Carterfone made an acoustic coupler for radio communication, and in 1968 the FCC declared acoustic coupling legal, and the future followed.
ATT had claimed that acoustic coupling could 'harm the network'. Guffaw.

The FCC in 2007 denied Skype permission to do the same thing with cell phones.
Think about that the next time you don't see Flash content in your phone browser.
posted by hexatron at 4:40 PM on November 26, 2010 [4 favorites]


Whatever you think of Bell's research program (in mid-century pros considered it THE place to get research done), there's no question that Bell advanced the art of recording.

They developed the use of microphones and subsidized the first electrical recordings using them, made in March 1932 with Harvey Fletcher and Leopold Stokowski. They're quite good ... have a listen. (About 100 of them are still extant.)
posted by Twang at 4:56 PM on November 26, 2010 [1 favorite]


The weirdest thing about Bell Labs is the original building. I just can't imagine anything getting done in such a stodgy old structure.
posted by Civil_Disobedient at 5:03 PM on November 26, 2010


ATT had claimed that acoustic coupling could 'harm the network'. Guffaw.

That's still possible- that's why modems are limited to 53k on analog lines. Any faster and the signals start to bleed into other lines and cause other troubles. Sort of how a nearby tv or radio transmitter can drown out other stations.

Those old phones were built a lot better than the shit we see these days, and it was all analog. Blasting a loud sound into the phone for long periods could have the potential to wreck things.
posted by gjc at 5:18 PM on November 26, 2010


This article makes me wonder what kind of stuff RCA had hidden in the archives because it wasn't considered viable or desirable.

I was going to say, as ovvl alluded to, that RCA & Sarnoff's history was a little more than hinky. With regard to FM, for example, it started with Sarnoff asking Edwin Armstrong to find a way to get rid of the static in (AM) radio; he did, perfectly, by inventing FM. Unfortunately, that would've upended RCA's entire business model, so instead he fired Armstrong and brought all his resources into squelching FM, until such time as it proved useful, by then later convincing the FCC to allocate TV signals to the FM band, rendering all the few existing FM stations totally useless.
posted by DiscourseMarker at 5:24 PM on November 26, 2010 [1 favorite]


I just can't imagine anything getting done in such a stodgy old structure.

I think if I worked in a place called the 'Volta Bureau', I'd feel compelled to do at least three crazy, mad-scientist experiments before 9AM.
posted by Kadin2048 at 8:57 PM on November 26, 2010 [1 favorite]


"The answer, rather surreal, is evident in the corporate memoranda, also unearthed by Clark, imposing the research ban. AT&T firmly believed that the answering machine, and its magnetic tapes, would lead the public to abandon the telephone."

Surreal indeed. Who uses an answering machine but not a telephone? In addition Bell had a monopoly and, as stated above, controlled what devices could be connected to their phone lines. If they had "invented" the answering machine they would have been able to charge rental for the device and, if they didn't have an effective patent, probably could have a proprietary jack to prevent competition.

"More precisely, in Bell's imagination, the very knowledge that it was possible to record a conversation would " greatly restrict the use of the telephone," with catastrophic consequences for its business. Businessmen, for instance, the theory supposed, might fear the potential use of a recorded conversation to undo a written contract. Tape recorders would also inhibit discussing obscene or ethically dubious matters."

I would think the financial benefit accrued from charging damn near every house in the US for an answering machine would by far outweigh any lost business accounts owing to a nebulous fear of having contracts undone because one party recorded another canceling a contract that one party apparently (by their logic) wanted to keep. Seriously, what businessperson calls up a client and offers to cancel a contract that they want to keep? The alternative to having a telephone for most businesses would be ceasing to exist anyway.
A fear of generating a record of obscene or ethically dubious matters via phone conversation means you don't talk about obscene or ethically dubious matters via phone. It does not mean you get rid of your otherwise useful phone.

Perhaps I'm missing something - I'd like to see more quotes from the memoranda.
posted by vapidave at 10:19 PM on November 26, 2010


I think what they meant was that the possibility of phone conversations being recorded would lead to Facebookian privacy freakouts over who is allowed to do so...
posted by arto at 10:48 PM on November 26, 2010


I don't know, vapidave, it seems pretty on the money to me that AT&T would spectacularly miss the point of answering machines. Much of the history of communication technology is filled with inventors and corporations misunderstanding or failing to predict consumer behavior. For example, check out what AT&T was selling to us as the world of "Century 21" in the 1962 World's Fair--at about 4:30 into this video they enter the Bell Labs exhibit. What I find particularly weird is that despite some of the innovations being obvious (push button dialing), there is zero mention of mobile telephony anywhere, despite the fact that the technology had been in existence for at least 15 years prior to this fair.
posted by DiscourseMarker at 11:02 PM on November 26, 2010


Are none of you old enough to remember what the world was like before the bells broke up? Up until the 80s, you had a choice of like 2 phones that you could buy. Do you think it was a miraculous coincidence that all this innovation happened in telecommunications after the Bell monopoly was split up?
posted by empath at 11:49 PM on November 26, 2010


Everybody wants basic research, but no one wants to fund it.

You know, I've got an idea - why not roll back CEO salaries to 1950's level and put the difference into R&D.

I wonder if the "tax" is gone, or if it just shifted into the pockets of the super-rich as wealth disparity grows.
posted by victors at 1:21 AM on November 27, 2010 [1 favorite]


This isn't surreal, it's business as usual. Trying to navigate the future of, well, anything is like driving in the fog. And just like driving, a small car is going to corner better than a giant sized bus. And a car that is driven by a bloated management structure, all vying for position and trying to land that coveted corner office is such a good idea that no one would seriously suggest building one. But for some reason we're absolutely sure that in the business arena it makes perfect sense.

The epitaph of big corporation capitalism is going to be, "Slightly more efficient and forward thinking than the Soviet bloc."

This is just an example.
posted by Kid Charlemagne at 2:06 AM on November 27, 2010 [1 favorite]


Before moving to Wall Street I worked for Bell Labs, at Holmdel out in New Jersey.

The article (excerpted from a book apparently) misses at least two key points that many of us working there were aware of: first of all, Bell Labs was a very large and, at times, not particularly well managed operation (at least by current standards of employee productivity and utilisation of shareholder capital).

Don't get me wrong; it was a wonderful place to work and carry out both basic and applied research. But the company was large and there were multiple divisions that at times slightly overlapped. And each division had parallel management who were competing for limited resources i.e., money as well as technical staff. In such environments decisions aren't so much taken as arrived at, and generally after one or more internecine battles. People being people keep score and sometimes later decisions aren't optimal as someone has to "pay back" for an earlier loss.

Second point: what the author presents as some kind of "discovery" - it could not originate technologies that might, by the remotest possibility, threaten the Bell system - really is self evident if one understands the business and regulatory environment of the time. Bell Labs was the R&D division for a regulated monopoly, the phone company; it just happened to throw off lots of technology that had broader applicability.

It wasn't so much that upper management actively "hid" key discoveries, rather than there might not have been applicability for our customers - The Bell System initially and the Regional Bell Operating Companies (RBOCs) before.

If these technologies weren't of interest to Bell Labs' customers they generally were shelved but that wasn't the end. People were always pushing their pet projects internally, even ideas that were years old. It wasn't uncommon to see something resurrected that had been terminated years earlier.

And you felt strongly about something but couldn't get corporate to give you the resources to pursue it? Well, I knew lots of folks who left to further develop concepts they'd championed while at Bell Labs, technology that wasn't of interest to our customers, e.g., AT&T.

I wonder how many folks leave Apple or Google because of similar frustrations?
posted by Mutant at 2:16 AM on November 27, 2010 [4 favorites]


Apple is the largest computer maker in the world,

Cite.
posted by The Lady is a designer at 4:09 AM on November 27, 2010


It's the terrifying inability of people in tech like delmoi to see a difference between the tablets that have "been around forever" and the iPad or feature-equivalent MP3 players and the iPod that make me fear Apple will never have good competition. What happens when Jobs dies? Because the difference sure isn't just marketing /derail.

Interesting thing about Bell labs is they could get away with a lot of this because telecoms was pretty much a monopoly *everywhere*. When it was broken up, we in the Uk felt the effects as Radio Shack started importing phones that had to be sold with little red triangle badges saying they had not been approved for connection to the UK network as our own monopoly tried to cling on.

That's the thing about tech monopolies today: you'd better be *global* if you want to act like this.
posted by bonaldi at 4:43 AM on November 27, 2010


Cite

I guess it depends on what you count as 'large'. It's currently the second largest company in the world, period, by market cap. Only Exxon-Mobil is larger.
posted by empath at 8:29 AM on November 27, 2010


empath: "I guess it depends on what you count as 'large'. It's currently the second largest company in the world, period, by market cap. Only Exxon-Mobil is larger."

I call shenanigans.
posted by pwnguin at 9:03 AM on November 27, 2010


I call shenanigans.

I don't know what's going on with that chart, but it doesn't seem very reliable. It lists Sony has having a market cap of "286.29T" And Toshiba as having "176.62T". Those are two and three, it lists the largest company as being "NTT DOCOMO" with a market cap of "56.28". There's no unit listed, perhaps they mean quintillion.

Google Finance seems a little more reliable, and shows XOM as the largest company, followed by AAPL at #2.
posted by delmoi at 4:57 PM on November 27, 2010


This article makes me wonder what kind of stuff RCA had hidden in the archives because it wasn't considered viable or desirable.

Or just fell through the cracks or got superceded before it could reach the marketing department.

I think they held back the color TV by decades or something like that.

RCA invented color television in 1940. Maybe not the best timing in the world. It took another 14 years to get FCC approval to broadcast. Early models cost like a thousand dollars, this at a time when an average salary was just over three thousand per annum. Took another decade or so for the price to come down enough and the programming to become compelling enough (Wonderful World of Disney) for the market to take off.
posted by IndigoJones at 5:24 PM on November 27, 2010


In the 1955 film noir classic "Kiss Me Deadly" the hero has a real answering machine in the his office. It takes up half a wall. It looks like it uses metallic tape of some kind(?)
posted by storybored at 7:15 PM on November 27, 2010


Ok, so that yahoo chart doesn't seem to be converting yen / remenbi / dollars into a common currency, and I've fallen victim to confirmation bias-- I blame my laziness of picking the first thing from a google query. It's pretty crazy that Apple's valuation has grown 50 percent in a year. But market cap is a silly measurement; it favors companies that never pay dividends. The more common definition is units shipped, which I'm assuming was avoided because Apple is high margin, low(er) volume.

And really, none of the big names we know of "make" PCs anymore. They outsource to ODMs like Quanta, and hire Industrial Designers like Ives to mold plastic to American tastes.
posted by pwnguin at 11:42 PM on November 27, 2010


« Older Georges Lepape...  |  The Economics of Seinfeld... Newer »


This thread has been archived and is closed to new comments