[COFF] Bell Labs vs "East Coast" Management style of AT&T

[steve jenkin]

I was wondering if anyone close to Early Unix and Bell Labs would offer some comments on the
evolution of Unix and the quality of decisions made by AT&T senior managers.

Tom Wolfe did an interesting piece on Fairchild / Silicon Valley,
where he highlights the difference between SV’s management style
and the “East Coast” Management style.

 [ Around 2000, “Silicon Valley” changed from being ‘chips & hardware’ to ’software’ & systems ]
 [ with chip making, every new generation / technology step resets competition, monopolies can’t be maintained ]
 [ Microsoft showed that Software is the opposite. Vendor Lock-in & monopolies are common, even easy for aggressive players ]

Noyce & Moore ran Fairchild Semiconductor, but Fairchild Camera & Instrument was ‘East Coast’
or “Old School” - extracting maximum profit.

It seems to me, an outsider, that AT&T management saw how successful Unix was
and decided they could apply their size, “marketing knowhow” and client lists
to becoming a big player in Software & Hardware.

This appears to be the reason for the 1984 divestiture.

In another decade, they gave up and got out of Unix.

Another decade on, AT&T had one of the Baby Bells, SBC, buy it.

SBC had understood the future growth markets for telephony was “Mobile”
and instead of “Traditional” Telco pricing, “What the market will bear” p[lus requiring Gross Margins over 90%,
SBC adopted more of a Silicon Valley pricing approach - modest Gross Margins
and high “pass through” rates - handing most/all cost reductions onto customers.

If you’re in a Commodity market, passing on cost savings to customers is “Profit Maximising”.
It isn’t because Commodity markets are highly competitive, but Volumes drive profit,
and lower prices stimulate demand / Volumes. [ Price Elasticity of Demand ]

Kenneth Flamm has written a lot on “Pass Through” in Silicon Chip manufacture.

Just to close the loop, Bells Labs, around 1966, hired Fred Terman, ex-Dean of Stanford,
to write a proposal for “Silicon Valley East”.
The AT&T management were fully aware of California and perhaps it was a long term threat.

How could they replicate in New Jersey the powerhouse of innovation that was happening in California?

Many places in many countries looked at this and a few even tried.
Apparently South Korea is the only attempt that did reasonably.

I haven’t included links, but Gordon Bell, known for formulating a law of computer ‘classes’,
did forecast early that MOS/CMOS chips would overtake Bipolar - used by Mainframes - in speed.
It gave a way to use all those transistors on a chip that Moore’s Law would provide,
and with CPU’s in a few, or one, chip, the price of systems would plummet.

He forecast the cutover in 1985 and was right.
The MIPS R2000 blazed past every other chip the year it was released.

And of course, the folk at MIPS understood that building their own O/S, tools, libraries etc
was a fool’s errand - they had Unix experience and ported a version.

By 1991, IBM was almost the Last Man Standing of the original 1970’s “IBM & the BUNCH”,
and their mainframe revenues collapsed. In 1991 and 1992, IBM racked up the largest 
corporate losses in US history to the time, then managed to survive.

Linux has, in my mind, proven the original mid-1970’s position of CSRC/1127
that Software has to be ‘cheap’, even ‘free’
   - because it’s a Commodity and can be ’substituted’ by others.

=================================

1956 - AT&T / IBM Consent decree: 'no computers, no software’

1974 - CACM article, CSRC/1127 in Software Research, no commercial Software allowed
1984 - AT&T divested, doing commercial Software & Computers
1994 - AT&T Sells Unix
1996 - “Tri-vestiture", Bell Labs sold to Lucent, some staff to AT&T Research.
2005 - SBC buys AT&T, long-lines + 4 baby bells

1985 - MIPS R2000, x2 throughput at same clock speed. Faster than bipolar, CMOS CPU's soon overtook ECL

=================================

Code Critic
John Lions wrote the first, and perhaps only, literary criticism of Unix, sparking one of open source's first legal battles.
Rachel Chalmers
November 30, 1999
https://www.salon.com/test2/1999/11/30/lions_2/ 

    "By the time the seventh edition system came out, the company had begun to worry more about the intellectual property issues and trade secrets and so forth," Ritchie explains.
    "There was somewhat of a struggle between us in the research group who saw the benefit in having the system readily available,
    and the Unix Support Group ...
    Even though in the 1970s Unix was not a commercial proposition,
    USG and the lawyers were cautious.
    At any rate, we in research lost the argument."

    This awkward situation lasted nearly 20 years.
    Even as USG became Unix System Laboratories (USL) and was half divested to Novell,
    which in turn sold it to the Santa Cruz Operation (SCO),
    Ritchie never lost hope that the Lions books could see the light of day.
    He leaned on company after company.

    "This was, after all, 25-plus-year-old material, but when they would ask their lawyers,
    they would say that they couldnt see any harm at first glance, 
    but there was a sort of 'but you never know ...' attitude, and they never got the courage to go ahead," he explains.

    Finally, at SCO [ by July 1996 ], Ritchie hit paydirt.
    He already knew Mike Tilson, an SCO executive.
    With the help of his fellow Unix gurus Peter Salus and Berny Goodheart, Ritchie brought pressure to bear.
    "Mike himself drafted a 'grant of permission' letter," says Ritchie,
    "'to save the legal people from doing the work!'"

    Research, at last, had won.

=================================

Tom Wolfe, Esquire, 1983, on Bob Noyce:
The Tinkerings of Robert Noyce | Esquire | DECEMBER 1983.webarchive
http://classic.esquire.com/the-tinkerings-of-robert-noyce/

=================================

Special Places
IEEE Spectrum Magazine
May 2000
Robert W. Lucky (Bob Lucky)
https://web.archive.org/web/20030308074213/http://www.boblucky.com/reflect/may00.htm
https://ieeexplore.ieee.org/stamp/stamp.jsp?arnumber=803583

Why does place matter? Why does it matter where we live and work today when the world is so connected that we're never out of touch with people or information?

The problem is, even if they get da Vinci, it won't work.
There's just something special about Florence, and it doesn't travel.
Just as in this century many places have tried to build their own Silicon Valley.
While there have been some successes in
    Boston,
    Research Triangle Park, Austin, and
    Cambridge in the U.K.,
to name a few significant places, most attempts have paled in comparison to the Bay Area prototype.

In the mid-1960s New Jersey brought in Fred Terman, the Dean at Stanford and architect of Silicon Valley, and commissioned him to start a Silicon Valley East.
[ Terman reited from Stanford in 1965 ]

=================================

--
Steve Jenkin, IT Systems and Design 
0412 786 915 (+61 412 786 915)
PO Box 38, Kippax ACT 2615, AUSTRALIA

mailto:sjenkin at canb.auug.org.au http://members.tip.net.au/~sjenkin