The Idea Factory tells the story of Bell Labs, the official research arm of AT&T, which developed everything from transistors, fiber optics, laser, satellites and cellular telephony during a period of intensive innovation from the 1920s to the 1980s, laying the foundations for the modern information age.
The Idea Factory Summary
The Idea Factory is a narrative profile of Bell Labs, from its humble origins in the 1920s to a golden period of innovation and finally its demise as AT&T lost their monopoly on over the US telephone network.
Packed with wide ranging evidence based insight, Jon Gertner tells the story of how a one relatively small group of talented scientists, engineers and mathematics worked in unique circumstances to create a conveyor belt of innovation that foreshadowed the coming age of information and the development of the Silicon Valley technology cluster.
Below are some of the key insights from the book.
- Bell labs employed 15,000 people at its peak, developing new technologies including the transistor, information theory, satellites, lasers, cellular telephones as well as incrementally improving the efficiency of the vast AT&T bell telephone network.
- While our technology has improved, the core principles of fostering innovation remain a constant.
- Bell Labs benefitted from monopoly funding support, competent management, critical mass, a sense of vision and a culture of experimentation and permissible failure.
- Despite its reputation, only 1 in 14 people at Bell Labs worked to innovate, suggesting that implementing a new technology takes at least 14 times the effort of inventing it.
- The leadership of Mervin Kelly oversaw the development of a large rural campus with long corridors between different departments, a precursor to today’s Silicon Valley architecture.
- William Shockley’s work with creation of the transistor effectively laid the foundations for the 1980s-current Moore’s law personal computing revolution, killing off previous innovation in vacuum tube efficiencies that improved the AT&T network.
- Texas Instruments and Fairchild Semiconductors both developed the idea of silicon based transistors after contact with the Bell Labs team in 1958.
- Claude Shannon pioneered information theory, writing the intellectual foundations for the digital distribution of information as binary code.
- John Pierce developed the core concepts of satellite communications building on a previous payload of inventions (adjacent possible) at the exact moment just before funding for space race developments – pioneering the Echo and Telstar satellites.
- The US government permitted AT&T as a monopoly in part due to the company’s decision to restrict itself from computers and make its patent portfolio open source. By the 1980s, the government had broken up the monopoly and Bell Labs lost the security of its consistent funding.
- Reflecting on the progress made by Bell Labs, Silicon Valley is only a partial descendent of the system as most venture capitalists don’t actively invest in moonshot new technologies and don’t take a long term view.
- In modern times, just 4% of the US workforce work in science, technology, engineering and mathematics yet these people have a disproportionate impact on the other 96% of jobs created as a result of technology.