7 ms·
Rather than a monopoly, I'd say it takes 2 things (that are often present in monopolies): 1) Big piles of money 2) Enough of a moat that there's no immediate t
by nkozyra 2y ago
Rather than a monopoly, I'd say it takes 2 things (that are often present in monopolies):
1) Big piles of money
2) Enough of a moat that there's no immediate threat from competition
#2 drives a lot of the desire to innovate, the hope being that by the time competition catches up, you've got so much new stuff that they're back where they started.
The closest thing I can think of in the tech space now is Apple with consumer hardware moat. The other big players are still cannibalizing and copying each other's business segments.
- trelane 2y agoYou are forgetting a vital element: the C-suite must want to plow the money into research instead of lining their yachts and various houses with it.
- bumby 2y agoSomewhat less cynical view, but maybe corporations were allowed to be more long term focused in the past?
- ElevenLathe 2y agoOr maybe they had to be, with interest and tax rates what they were?
- bumby 2y agoCould you elaborate or be more specific? Given how long BL existed, I’m not sure I can pin down what rates you’re talking about
- gregw2 2y agoOne of the commenters on the original article said "Bell Labs was funded through a 1% tax on Bell's overall revenue, as well as a claim on a portion of Western Electric's revenue, so yes, AT&T was able to recoup Bell Labs' expenses." This would protect it from (at least certain types of) C-suite predation presumably.
- sneed_chucker 2y agoAT&T wasn't publicly traded until 1984, so there's a clue for you right there
- dogsgobork 2y agoBy 1984 AT&T had been listed on the NYSE for over 80 years.
- nik_0_0 2y ago“The American Telephone and Telegraph Company (AT&T) was listed on the NYSE on Sept. 4, 1901. Only 11 other companies have been listed longer than AT&T.“ Yeah, impressively wrong gp! 1984 was when they were broken up by Justice Department.
- hibikir 2y agoYou don't need to mandate a short term view when the executive's massive pay packages depend on stock valuations: They will chase the money all by themselves, not trying to build a company that might make major discoveries eventually
- skeeter2020 2y agoIt's not like corporate executives have carte blanche to make these decisions. They report to the board, who represent the shareholders, to whom they have a legal duty to maximize profits. The entire construct is set up to promote the alternative to building the next Bell Labs.
- bigstrat2003 2y agoThey don't have a legal duty to maximize profits, they have a legal duty to represent the fiduciary interests of the shareholders. If the company doesn't make as much profit next quarter but it will be healthier in the long run for it, that is perfectly OK.
- deleted 2y ago[deleted]
- ramblerman 2y ago> 1) Big piles of money 2) Enough of a moat that there's no immediate threat from competition You just described google 10 years ago. And I would argue they have been on a downhill slop ever since. So I think its something else, perhaps great leadership at the right time. Google certianly had the talent, but pichai has been an awful steward.
- runevault 2y agoEven when you create the conditions there's always some luck factor. Whether it is leadership with the right vision or the right people in other key roles to create innovation. But I feel like the 2 points above are sort of the starting point that makes it possible for the other things to matter (or more likely, flukes can occur).
- PaulDavisThe1st 2y agoPart of the problem, I think, is that Google's relentless focus on information is just never to end up being as sexy as the stuff Bell Labs worked on over the years.
- randomdata 2y ago> So I think its something else The government allowed Bell to maintain its monopoly position with the understanding that Bell Labs would work for the public good. In other words, Bell was unable to capitalize on what Bell Labs created. Bell Labs, in hindsight, is so significant because everyone else was able to take their research and do something with it. Google has given us things here and there (the LLM craze stems from papers published by Google), but it seems most of the research they are doing stays within Google. For example, I expect you will struggle to find what you need to start a self-driving car company based on Waymo’s work. > Google certianly had the talent Including Bell Labs alumni. They used their time to create Go. If that isn't game changing, perhaps Bell Labs was also a product of its time?
- emchammer 2y agoIt seems like there was something special about the innovation derived from collective spirit during that time, the 1940-1960s. Post-depression and -war momentum combined with major scientific and technology milestones that had to be passed, with a dynamic caused by an unprecedented global situation.
- passwordoops 2y ago3) tax laws that mandate buybacks + dividends cannot exceed more than a % value of R&D + CapEx spend. Otherwise 1+2 result in the C-suite deciding to divert all that cash to their pockets. Reference: the past 40 years of big business
- jszymborski 2y agoWhy can't we just fund scientists to acheive these goals? Funding has been lacklustre for years.
- chuckadams 2y agoBecause the marketplace is more efficient at directing the funding. I’m not a cheerleader for capitalism either, but it does work better sometimes.
- ikiris 2y agoIf by more efficient, you mean more efficiently switching to stock buybacks to pad owner pockets outside of tax consequences.
- typon 2y agoBasically ALL the important inventions and scientific discoveries have been made at publicly funded universities.
- chuckadams 2y agoNote the title of the article. Now look up where the transistor was invented. And the laser. And photovoltaic cells. I like public research too, I think there should be a hell of a lot more of it. It just isn't the only viable player.
- cobalt 2y agoBased on the book "The Idea Factory" (https://en.wikipedia.org/wiki/The_Idea_Factory https://en.wikipedia.org/wiki/The_Idea_Factory), it sounds like the regulated monopoly forced certain constraints on their business, such that they had to prove they were a utility. This meant not having infinite profits, and that the engineers were generally allowed to think long term since any good idea in the future could benefit the company without short term profitability risk
- TheCondor 2y agoHunger. Hunger and some money.
- femto 2y ago3) Politically savvy managers with a technical background, who treat money/sustainability as an enabling factor and see the primary output as being technical. The closest I every came to this was Australia's DSTO in the late 1980s. The management was technical and cared deeply about their people, the development of those people and making a positive technical contribution. An interesting recollection of Bell Labs: https://quello.msu.edu/wp-content/uploads/2015/08/Memories-Noll.pdf https://quello.msu.edu/wp-content/uploads/2015/08/Memories-N... I think it's not about recreating Bell Labs, but doing something better that will fit in with today's technical ecosystem. Are entry barriers lower today, or is that part of the problem: low entry barriers mean people don't have to congregate to get sufficient resources?
- inglor_cz 2y ago"1) Big piles of money 2) Enough of a moat that there's no immediate threat from competition" SpaceX right now is in a very similar position.
- Communitivity 2y agoI think it requires a third thing: long-term thinking. Other commenters noted that Google and Microsoft had big piles of money and a decent moat. They have not created anything like Bell Labs. Google tried, with DeepMind. The problem is that companies used to think about 5,10,20 years out. Modern companies are gauged and gauge themselves by metrics that are quarterly or annual. They, to borrow from The Fast and the Furious, are living their life one business quarter at a time. I don't think you can build something like Bell Labs, PARC, or the Lockheed-Martin Skunkworks with short-term thinking.