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

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Notable notes

Mervin Kelly hired the best researchers he could find for the good of the system. The new recruits were no longer asked to climb telephone poles and operate switchboards. But all were given long seminars in their first few weeks on how the Bell System worked. Oliver Buckley, the Labs vice president, told his new employees, “Our job, essentially, is to devise and develop facilities which will enable two human beings anywhere in the world to talk to each other as clearly as if they were face to face and to do this economically as well as efficiently.”

The scientists and engineers at Bell Labs inhabited what one researcher there would aptly describe, much later, as “a problem-rich environment.”

devices that could assess things like loudness, signal strength, and channel capacity didn’t exist, so they, too, had to be created—for it was impossible to study and improve something unless it could be measured.

Luck seems to matter, and so does timing, for it tends to be the case that the right answers, the right people, the right place—perhaps all three—require a serendipitous encounter with the right problem. And then—sometimes—a leap. Only in retrospect do such leaps look obvious. When Niels Bohr—along with Einstein, the world’s greatest physicist—heard in 1938 that splitting a uranium atom could yield a tremendous burst of energy, he slapped his head and said, “Oh, what idiots we have all been!”11

And for close to a year, any attempts to make the field effect work failed.

Over the next few days, Brattain and Bardeen refined their device in preparation for a demonstration to the Bell Labs management. It was scheduled for the afternoon of December 23, 1947. Mervin Kelly was not invited. A believer in granting a degree of autonomy to researchers, he had not asked about, and had not been kept apprised of, Bardeen and Brattain’s work.

In the late 1940s, finding a market for the new device may have been the least of the Labs’ concerns. “If they could be made, they could be sold,” the technology historians Ernest Braun and Stuart Macdonald noted about the new transistor. “If nobody else bought them, certainly the vast Bell empire itself would form an adequate market.”30 Thus it was the technical and production hurdles that seemed most formidable.

Bell Labs helped maintain and improve that system, he said, by creating an organization that could be divided into three groups. The first group was research, where scientists and engineers provided “the reservoir of completely new knowledge, principles, materials, methods and art.” The second group was in systems engineering, a discipline started by the Labs, where engineers kept one eye on the reservoir of new knowledge and another on the existing phone system and analyzed how to integrate the two. In other words, the systems engineers considered whether new applications were possible, plausible, necessary, and economical. That’s when the third group came in. These were the engineers who developed and designed new devices, switches, and transmissions systems. In Kelly’s sketch, ideas usually moved from (1) discovery, to (2) development, to (3) manufacture.

Part of what seemed to make the Labs “a living organism,” Kelly explained, were social and professional exchanges that moved back and forth, in all directions, between the pure researchers on one side and the applied engineers on the other. These were formal talks and informal chats, and they were always encouraged, both as a matter of policy and by the inventive design of the Murray Hill building.

At the Labs this was sometimes known as going to “the guy who wrote the book.”

Physical proximity, in Kelly’s view, was everything. People had to be near one another. Phone calls alone wouldn’t do.

IN TECHNOLOGY, the odds of making something truly new and popular have always tilted toward failure. That was why Kelly let many members of his research department roam free, sometimes without concrete goals, for years on end.

Here, then, was the dilemma: Just because you had made something new and wondrous didn’t mean you would make something else new and wondrous. But Bell Labs had the advantage of necessity; its new inventions, as one of Kelly’s deputies, Harald Friis, once said, “always originated because of a definite need.”

the solution to a technological problem invariably created other problems that needed solutions.

November 1958 Fortune story that christened Kelly’s shop as “The World’s Greatest Industrial Lab.” Francis Bello,

That was a natural monopoly. The whole system—an analog system—wouldn’t work if it was done by a myriad of companies.”22 But when Shannon explained how all messages could be classified as information, and all information could be digitally coded, it hinted at the end of this necessary monopoly.

“But what could be done about satellite communications in a practical way?” Pierce wondered. “At the time, nothing.” He questioned whether he had fallen into a trap of speculation, something a self-styled pragmatist like Pierce despised. There were no satellites yet of any kind, and there were apparently no rockets capable of launching such devices. It was doubtful, moreover, whether the proper technology even existed yet to operate a useful communications satellite. As Pierce often observed ruefully, “We do what we can, not what we think we should or what we want to do.”

the Young Turks succeeded for the first time in bridging the gap between the best science of the academy and the important applications that a modern society needed.

For all these reasons, the technology couldn’t attract enough users to attract even more users. “To start up a service, you have to think about: I have one, you don’t have one—so I can’t talk to you,” Irwin Dorros says. “So I can only talk to you if you have one. So how do you get a critical mass of people that have them?” Many years later, a computer engineer named Robert Metcalfe would surmise that the value of a networked device increases dramatically as the number of people using the network grows.

But to an innovator, being early is not necessarily different from being wrong.

“Unfettered research,” as Odlyzko termed it, was no longer a logical or necessary investment for a company. For one thing, it took far too long for an actual breakthrough to pay off as a commercial innovation—if it ever did. For another, the base of science was now so broad, thanks to work in academia as well as old industrial laboratories such as Bell Labs, that a company could profit merely by pursuing an incremental strategy rather than a game-changing discovery or invention.

In 1995, Forrester remarked that “science and technology is now a production line. If you want a new idea, you hire some people, give them a budget, and have fairly good odds of getting what you asked for. It’s like building refrigerators.”

“In American and European industry,” Odlyzko concluded, “the prospects for a return to unfettered research in the near future are slim. The trend is towards concentration on narrow market segments.”4

But Kelly believed the most valuable ideas arose when the large group of physicists bumped against other departments and disciplines, too. “It’s the interaction between fundamental science and applied science, and the interface between many disciplines, that creates new ideas,” explains Herwig Kogelnik, the laser scientist. This may indeed have been Kelly’s greatest insight.

What about Bell Labs’ formula was timeless? In his 1997 list, he thought it boiled down to four things: A technically competent management all the way to the top. Researchers didn’t have to raise funds. Research on a topic or system could be and was supported for years. Research could be terminated without damning the researcher.

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