The Idea Factory: Bell Labs and the Great Age of American Innovation

“The Idea Factory: Bell Labs and the Great Age of American Innovation, by Jon Gertner, Penguin Books, NY, 2012. This 412-page paperback tells the story of Bell Labs, the research arm of AT&T or Ma Bell. Bell Telephone was established from Alexander Graham Bell's invention of the telephone in 1876. Western Electric became the manufacturing arm of the Bell system (in 1881 after founding as a manufacturer of telegraph equipment and at one time one-third owned by Western Union). Bell Labs was formed in 1925 from the research department of Western Electric, originally located on West Street in New York City. The lab had achieved significant success and became sizeable. It was owned equally by Western Electric and AT&T and supervised by its own board of directors. (The well known Murray Hill, NJ campus was constructed beginning in 1942.)The need for a research department came from increasing competition as the Bell patents expired. Theodore Vale envisioned a single universal telephone system with compatible technology that could interconnect. A long distance service that could complete transcontinental phone calls was to be the basis of this national network. He wanted it completed for the San Francisco World's Fair in 1914. That became possible when Bell perfected Lee DeForest's audion tube (aka vacuum tube) and used it to make a practical amplifier.Bell staffed its research labs with the best scientists from Ivy League universities. It developed relationships with universities to recruit the best. Often they were hard working individuals from small towns who were gifted and got into top universities. Physicists were especially sought for their theoretical knowledge, but experimentalists were also valued. A range of other disciplines were also on staff providing experts to consult on almost any problem.Bell Labs is perhaps best known for the invention of the transistor. The limitations of the vacuum tube were well known. They were difficult to manufacture, used large amounts of power, generated much heat, and burned out. A solid state device offered advantages. Ideas circulated as early as 1939, but research was delayed by the needs of World War II. After the war, first success was achieved by John Bardeen and Walter Brattain on Dec 16, 1947. William Shockley soon came up with the junction transistor, which was announced on June 30, 1948. Fearing antitrust action and to grow volumes and reduce cost, the technology was licensed to others including Raytheon, RCA and GE. Shockley, Bardeen and Brattain were awarded the Nobel Prize for their work in 1956.Electronics research for military applications has always been a major part of Bell Labs, but much of the work is still secret. War time efforts included the development of synthetic crystals used as filters after natural supplies became unavailable, extensive work on radar, manufacture of the cavity magnetron, the essential component of small, microwave radar equipment, and radar controlled guns used to shoot down V-1 rockets. Crytopgraphy/code breaking research is part of the Bell expertise. In 1949, AT&T was named manager of Sandia National Laboratories, in Albuquerque, NM, the lab that did nuclear weapons research. Later came the Nike ground to air antiaircraft, missile system (1953) and the Dew line (1954), the northern radar network used to detect a possible attack from across the Arctic. Bell recognized early on the potential for digitized signals to deliver high quality sound with less distortion than traditional analog methods.The transistor required numerous advances in materials science. Semiconductor materials, germanium and silicon, had to be made at very high purity. Trace impurities made performance unpredictable. Techniques to grow large crystals and melt refining/zone refining were developed. The original transistor used germanium, but use of more abundant silicon was established in Jan, 1954. Diffusion doping methods were developed in 1955. Photolithography for photographic mass production of semiconductors soon followed. Photovoltaic solar cells were invented at about the same time.William Shockley left Bell Labs to set up his own semiconductor company with financing from Arnold Beckman, inventor of the pH meter, one of the first electronic laboratory instruments. His management style and extreme politics interfered, but others recruited for his company later founded Fairchild Camera and Intel.Expertise in microwave electronics came from work with radar. A practical microwave relay system for long distance was in service by 1951. A transatlantic telephone cable was laid successfully in 1956. Another important technology, the traveling wave tube, invented at Oxford, was adapted to provide broad band amplification for communications.In 1956, antitrust threatened to separate Western Electric from AT&T. In a settlement, Bell agreed not to enter the computer or consumer electronics businesses and to license its patents to competitors.Bell Labs played a key role in the development of communications satellites. Their potential for long range communications as with Europe was recognized as early as 1954. Lack of suitable rockets prevented development until the launch of Sputnik in 1957. Echo, the first communications satellite, was a passive satellite designed to reflect a signal to a receiving antenna. It was launched on August 12, 1960. As part of the Echo project, a large steerable horn antenna was constructed at the Bell Labs rural research site at Holmdel, NJ. It was later used for experiments proving the big bang theory, which won another Nobel Prize for Bell Labs. Telstar, the first satellite to receive and retransmit signals, was launched in 1962.Charles Townes' invention of the maser at Columbia University in 1954, was followed by additional development at Bell Labs in 1957. The ruby laser was invented at Hughes Aircraft in 1960. Bell personnel soon invented the gas laser and showed that it could be used for communications. When optical fibers were invented at Corning Glass Works in 1971, Bell entered a patent sharing agreement with Corning. The first test of a fiber optics system was run in Atlanta in 1975.Bell was not invincible. One that failed is Picturephone (1964). People seemed to like the idea, but the system failed to gain acceptance. One that got away was integrated circuits (1960). Bell probably had the capability, but others put the pieces together first. Bell had a long history of anti-semitism. That changed only in 1940 when the first Jews were hired in the lab. The first women were hired at the same time to replace men who were drafted. (But one suspects few of these women had PhDs.)A major development of 1964 was digital electronic switching. Previously dial telephone exchanges used of electromechanical relays. They were large, mechanical and required maintenance. Electronic switching was much smaller, more reliable and allowed additional features such as call forwarding and call waiting. Digital technology also led to the development of the Unix computer language.Mobil communication had been of interest from the 1920s, but available radio frequencies limited the service to only a few users. Bell developed radio sets for tanks and airplanes during World War II. (Motorola invented the handie-talkie carried by soldiers.) Car phones became available after the war. The basic cell phone system using low power, short range transmitters in a hexagonal cell arrangement was proposed by Bell scientists in 1947. Its implementation required computer power to successfully handoff calls to the next transmitter as the phone moved through an area. And it awaited allocation of frequencies by the FCC. The system was first used to provide phone service on the Metroliner traveling between New York City and Washington, DC in 1966. Intel's integrated circuit 4004 microprocessor was an important contributor in that it made computing power small and portable. So was electronic switching technology. AT&T submitted its proposal to the FCC in December, 1971, and about the same time agreed to limit participation to the cell phone network leaving the production of cell phones to competitors, especially Motorola, whose commercial radio communications systems for police, fire, taxis, etc might be threatened. A first test was run in Chicago in 1978.Competition to the Bell phone system's long distance network began in the late 1960's when MCI constructed its own microwave relay system. In 1971, the FCC required that AT&T connect with MCI. In 1974, the Justice Department filed an antitrust suit against Bell and Western Electric. Agreement was reached in 1982 to divest the local telephone operating companies as Baby Bells while AT&T would retain Long Lines and be released from the 1956 consent degree that blocked participation in computers and other industries. Western Electric and Bell Labs were retained and were now free to pursue other business, but they were used to captive customers and had no marketing experience.In 1996, AT&T decided it needed to focus. Western Electric was spun off as Lucent, which had headquarters at Murray Hill. Most of Bell Labs went with Lucent. For a while Lucent prospered in the dot com boom, but in 2000 the market collapsed. Large fiber networks had been constructed in anticipation that the internet would soon require them, but much of that fiber was under utilized and dark. In the collapse that followed, thousands were laid off including many at Bell Labs. In 2005, Lucent merged with Alcatel to become Alcatel-Lucent. Bell Labs continued under new management with a focus on entrepreneurial pursuits, but it was a shadow of its former self. Nature magazine published an article on the new Bell Labs reporting that it had only four researchers doing basic physics research.Clearly Bell Telephone was a major innovator in the early development of electrical equipment and electronics. Others were apparently GE, Westinghouse, Marconi, and RCA. Western Union's contributions have been elusive. On the West Coast, Federal Telegraph (some time employer of Lee DeForest) and Litton Industries are usually named as pioneers.This book is a nicely done. It is covers the subject in clear, non-technical language. Although the focus is Bell Labs and AT&T technology, Gertner also provides a history of AT&T. It does include much on the personal lives and careers of key individuals. I found only a few omissions. The story of talking movies is omitted. Apparently it was Western Electric who developed movie sound systems as an application of the amplifier. (In 1924, Western Electric's talking movie system came to market. Vitaphone Corporation was formed to market the technology; Warner Brothers was the first customer.) Gertner identifies Southern Bell Telephone as the acquirer of AT&T, which then changed its name to create the new AT&T. In reality it was Southwestern Bell Telephone Co. Strangely there is no mention of the other surviving Bell Company, Verizon, successor of Bell Atlantic/New York Telephone. Photographs. References. Bibliography. Index.Related Books:“Manufacturing the Future: A History of Western Electric,” by Stephen B. Adams and Orville R. Butler, Cambridge University Press, NY, 1999.“Empire of The Air: The Men Who Made Radio,” by Tom Lewis, HarperCollins, New York, 1991.“Bill and Dave: How Hewlett and Packard built the world's greatest company,” by Michael S. Malone, Penguin, NYC, 2007.

The Idea Factory is a well written presentation of what happened in Bell Laboratories in its early and middle lifetime. The author has captured the view from within the Lab and has presented a history that is in many ways presented in a manner in which the Lab people would have wanted it presented. His conclusions however are subject to significant debate, if not being downright wrong.I write this review also having heard the author present his work in Madison, NJ to an audience almost totally filled with hundreds of former Labs staff and also as one who spent a great deal of time at the Labs from 1964 through 1972, while going back and forth to MIT, plus over fifty years in the industry.The author presents the often told tales of Shockley and the transistor, Shannon and information theory, as well as all the management types who formed, directed, and molded the Lab like Kelley and others. Many of these people I knew firsthand and as any observer the view is all too often colored by one's position at the time.The driving presumption of the author is best stated in his introduction where he says:"Some contemporary thinkers would lead us to believe that twenty-first century innovation can only be accomplished by small groups of nimble profit seeking entrepreneurs working amid the frenzy of market competition. Those idea factories of the past, and perhaps their most gifted employees, have no lessons for those of us enmeshed in today's complex world. This is too simplistic. To consider what occurred at Bell Labs, to glimpse the inner workings of its invisible and now vanished "production lines" is to consider the possibilities of what large human organizations might accomplish."This conclusion is frankly a significant over-reach, if not just out right wrong, since it is posited without any basis in fact contained within the book. The author never really looks at the many other parts of the Lab, the tens of thousands who worked on miniscule parts of large systems. The R&D group at Murray Hill was but a tiny part of an enterprise whose overall goal was to ensure the monopoly that AT&T had been granted by the Federal Government and to maximize the profit made in that monopoly.To understand one must recognize that in the old Bell System profit was defined as a return on investment, meaning the invested plant. Revenue thus equaled expense, plus depreciation plus that profit construct; namely the company could charge whatever it wanted to subject to the regulators limited control. The game was thus to maximize profit, which in turn meant to maximize the invested plant, and not to be maximally efficient in a competitive sense, there was no competition. Understanding the ground rules of the old Bell System is essential to the understanding of Bell Labs. No other company, save perhaps the power utilities, functioned in such a manner. This was the basis of the world view of the Labs, a world of monopolistic control.But the "creative destruction" of the free market did begin to surround the Labs. It surrounded the Labs in the areas in which the author appears paradoxically to make them most successful. Let me discuss just three examples.Satellite Communications: The author speaks glowingly of Pierce and his vision of satellite communications. Yet Pierce wanted dozens of low orbit satellites, apparently driven by his desire to have low time delay for voice. He wrote a paper which appeared in Scientific American proselytizing the idea. Based upon that proposal, COMSAT was formed and capitalized based upon a need for this massive investment not only in space segment but also in the complex tracking earth stations. A few days after the COMSAT IPO Hal Rosen and his team at Hughes launched Syncom I, the first synchronous satellite. Within weeks they launched Syncom II. Synchronous satellites provided global coverage with only three satellites, not the dozens demanded by Pierce's world view. COMSAT was then off with its own satellite, Intelsat 1 and its progeny using not Pierce, but Rosen. Somehow this minor fact is missing from the book.Digital Switching: Fred Kappel was the Chairman of AT&T in the 60s during the time of the development of the first Electronic Switching System, the No 1 ESS. This system was developed by people such as Ray Ketchledge and others. They had deployed a computer based system, albeit still with analog mechanical switches called Fereeds. Fereeds were small mechanical switches that clicked and clacked. The Fereeds made the new computer elements be the dog still wagged by this old technological tail cross-connection technology. Kappel wanted an all-digital switch and the Labs kept putting him off. But at the time he had another card up his sleeve. AT&T also owned Bell Canada and their Bell Labs entity called Bell Northern Research. So off he went and got them to build the all-digital switch. The entity doing it became Northern Telecom, NORTEL. NORTEL subsequently became a major switch supplier of their new and better switches to the Operating Companies. Thus, in a true sense, Kappel used the entrepreneurial spirit of the Canadians to do what the mass of people at Bell Labs would not do.The Internet: Now in the mid-1970s the ARPA net was in early development and some of the basic principles were evolving from Government, Academia, and a bunch of small start-up companies like Linkabit and BB&N. ARPA, the DOD advanced research arm had an office called IPTO and they wanted to expand the Internet more aggressively using the public telephone network. Yet since AT&T was a monopoly they somehow had to co-opt AT&T to agree. A first step was to go to a meeting at Murray Hill and seek their support. So off go a couple of folks from ARPA and in Murray Hill they met the standard Bell System meeting of a few dozen people. The senior person, a VP I was told, began to lecture them that if they wanted this accomplished just send them the money and they would deliver what they felt was the correct design. The ARPA folks walked away somewhat aghast and immediately reached the conclusion that they would develop what became the Internet, totally independent of AT&T. This was, in a sense, the final straw since it sowed, in my opinion, the seeds for AT&T's ultimate destruction, not the Judge Greene breakup.The author, in my opinion, misses many other R&D entities which had a significant role in the evolution of technology, oftentimes well exceeding Bell Labs. Let me discuss just a few:MIT Rad Lab: At the beginning of WW II Vannevar Bush set out to establish a center for R&D focusing on radar. Bell Labs had tried to capture this jewel but Bush wanted a more innovative and competitive center and as such he chose MIT and from that came the Rad Lab. The Rad Lab was composed of engineers, but they were drawn from many places and the best part was that when the war was over they went back to those many places. The Rad Lab designed radar but radar had the same elements as communications, and specifically digital communications. Thus from the Rad Lab came such innovations as the modem, designed by Jack Harrington, to interconnect signals from distributed sites. From the Rad Labs came rapidly effected engineering systems, and the terms system is critical, because the parts all worked together. From the Rad Labs came a set of book, the Rad Lab Series, which became the bible for engineers who entered the wireless world and the digital age. The Rad Lab was a petri dish that bred hundreds of engineers who went forth and created the core "startups" in the Cambridge 128 areas and also in Silicon Valley.DoD Design Companies: It is well known that many of the transistor companies were driven by the demands of DOD. Also many of these same types of companies in Silicon Valley and in the 128 Corridor were driven by DOD money as well. Groups of engineers educated from the Rad Lab type entities of WW II came out and started small companies fed from the DOD demands in those days. It allowed for many bright engineers to experience the "startup" albeit at the Government trough.This this book has strengths and weaknesses. Its strengths are:1. A well written story of some of the key players in Bell Labs.2. A well described evolution of the development of the management techniques.3. An excellent discussion of some of the major personalities in the R&D world at the time.Its weaknesses however should be considered when taking the author's conclusions to heart. Namely:1. This is truly a tale written from the perspective of Bell Labs. It totally fails to consider the competitors and thus when reaching his conclusion the author does so without any basis in fact. He totally ignores the weaknesses of such a system as Bell Labs and moreover he fails to consider the alternative entities such as the Rad Lab and its offshoots. In my opinion this is the major failing of this book. It would have been much more credible and useful if the author had looked at Bell Labs in the context of the total environment; the strengths and weaknesses and the competitors and alternative models of research.2. The monopolistic structure of AT&T was a major driver for what people do and why. The issue of return on investment being the profit, and not revenue less expenses, is a true distortion of what is done and why. This idea of a world view is a formidable force. It molded what the Labs and AT&T did and why they did it. The author seems to be totally devoid of any notion of its import.3. There were many failures at Bell Labs, and those failures were never truly perceived by those within the system, and it was this blind spot that in my opinion also led to its downfall. The author missed a great opportunity to follow up on this. Instead we see all these Herculean minds making great successes and yet the system collapses.4. Bell Labs was enormous in size and scope at its high point. I had spent time at Holmdel, Whippany, Indian Hill, Andover and even a brief stint at the remains of West Street. Yet the focus is on Murray Hill and a small part of a small part. This is especially disturbing in light of the author's global conclusion which is reached without a single discussion of these areas. To do Bell Labs justice one must perforce covers these as well. The Pierce, Shockley and Shannon tales are told again and again, but the efforts of the hundreds of thousands of others over the decades are still silent. In the presentation by the author before a mostly former Bell Labs group it was clear that my observation on this point had substantial merit.Overall there is a significant story to be told but this author does not accomplish it. In fact the author's statement denigrating the entrepreneur and the process of "creative destruction" is made without any attempt to understand the difference between a monopolistic structure and competitive markets. Perhaps if we had kept the old paradigm we would still have our black rotary dial phones.

Jon Gertner's book is the story of the rise, growth, and eventual winding down of Bell Labs, one of the greatest research institutions of all times. It would take a massive multi-volume history to cover everything that Bell Labs did, so the author concentrates on on the period between the 1930s and the 1970s, and follows some the the key players and their research through that period.However, he also explains very clearly the political and economic decisions that enabled AT&T to support its huge R&D division over such an extended period. He explains how the problems facing AT&T as the USA's monopoly long distance carrier, operating over inter-continental distances, combined to form the unique, and highly productive, blend of scientists and engineers that was the Lab. This discussion is essential to understanding how Bell labs was able to achieve what it did, and the author handles the subject matter very clearly.The book covers Bell Labs' seminal work on multiplexing, information theory, transistors, lasers, fiber optics, communications satellites, the cosmic microwave background, and mobile phone networks, among other things. Not everything Bell Labs did was a resounding success, though. There were failures as well as successes. For instance, in the early 1960s the Labs was instrumental in developing the Picturephone. This device turned out to be a major flop and an embarrassment with minimal sales after a lot of money and reputations had been staked on its success!The book is well written, informative and easy to read. If you want discover how the basic inventions that underpin the defining technologies of the 21st Century were made, then this book is a must read.

This is a must read for an engineer, scientist or physicist of any age. The Bell labs were structured as a multi-discipline organisation unique in its day and never since emulated. The inventions created in this environment underpin everything we take for granted today.Solid state components, silicon chips, lasers, microwaves, solar panels, fibre optics, cellular phone networks, modems, subscriber trunk dialling, Satellite communications.........

For a history book and, perhaps even more so, one about technology this book almost kept me on the edge of my seat about what was to be told next. Early periods in the characters history jut brought so much home about how they leapt forward in Bell Labs when the rest of the world was still not tech savvy.Overall a good read, even if the last couple of chapters, in summing up, were for me a little less gripping.

Fabulous book, packed with the kind of facts you want in a biography like this: Easy to dip in and out of, with many small sections, but integrated into a picture of a marvellous organization in full context.

Great research that has been turned into an easy read. Describes a quite amazing organisation and time.