More (#2) from The Idea Factory:

In many respects, says Mathews, a phone monopoly in the early part of the twentieth century made perfect sense. Analog signals — the waves that carry phone calls — are very fragile. “If you’re going to send sound a long way, you have to send it through fifty amplifiers,” he explains, just as the transatlantic cable did. “The only thing that would work is if all the amplifiers in the path were designed and controlled by one entity, being the AT&T company. That was a natural monopoly. The whole system — an analog system — wouldn’t work if it was done by a myriad of companies.” 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. Digital information as Shannon envisioned it was durable and portable. In time, any company could code and send a message digitally, and any company could uncode it. And with transistors, which were increasingly cheap and essential to digital transmission, the process would get easier by the year.

Mathews argued that Shannon’s theorem “was the mathematical basis for breaking up the Bell System.” If that was so, then perhaps Shockley’s work would be the technical basis for a breakup. The patents, after all, were now there for the taking. And depending on how it played out, one might attach a corollary to Kelly’s loose formula for innovation—namely, that in any company’s greatest achievements one might, with the clarity of hindsight, locate the beginnings of its own demise.

And:

Pierce let Wells know that one of his science fiction concepts — an atomic bomb — was coming true: America was building one. He had deduced this from the way most of the country’s good physicists were disappearing and being directed to secret laboratories around the country. Pierce told Wells that he and his fellow engineers joked that promising scientists had been “body snatched.” But Wells was largely uninterested in what Pierce was saying. He wanted to talk about politics — among other things, Churchill, Roosevelt, and race in America.

And:

In October 1954, [Pierce] was invited to give a talk about space in Princeton at a convention of the Institute of Radio Engineers. Pierce decided he would discuss an idea he had for communications satellites — that is, orbiting unmanned spaceships that could relay communications (radio, telephone, television, or the like) from one great distance to another. A terrestrial signal could be directed toward the orbiting satellite in space; the satellite, much like a mirror, could in turn direct the signal to another part of the globe. Pierce didn’t consider himself the inventor of this idea; it was, he would later say, “in the air.” In fact, unbeknownst to Pierce, Arthur Clarke had written an obscure paper about ten years before suggesting that a small number of satellites, orbiting the earth at a height of about 22,300 miles, could connect the continents. Clarke never developed the idea any further and quickly lost interest in it. “There seemed nothing more that could be said until technical developments had validated (or invalidated) the basic concept,” he later wrote. In Pierce’s talk, however, he made some detailed calculations about satellites. He concluded that orbiting relays might not be financially viable over land; in the United States, the Bell System already had an intricate system of coaxial cables and microwave links. The oceans were a different story. The new cable that Bell Labs was planning for the Atlantic crossing in 1954 would carry only thirty-six telephone channels at tremendous expense and tremendous risk of mechanical failure. A satellite could satisfy the need for more connections without laying more cable.

One academic in the audience that day in Princeton suggested to Pierce that he publish his talk, which he soon did in the journal Jet Propulsion. “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.”

More (#1) from The Idea Factory:

On January 1, 1925, AT&T officially created Bell Telephone Laboratories as a stand-alone company, to be housed in its West Street offices, which would be expanded from 400,000 to 600,000 square feet. The new entity—owned half by AT&T and half by Western Electric—was somewhat perplexing, for you couldn’t buy its stock on any of the exchanges. A new corporate board, led by AT&T’s chief engineer, John J. Carty, and Bell Labs’ new president, Frank Jewett, controlled the laboratory. The Labs would research and develop new equipment for Western Electric, and would conduct switching and transmission planning and invent communications-related devices for AT&T. These organizations would fund Bell Labs’ work. At the start its budget was about $12 million, the equivalent of about $150 million today.

And:

We usually imagine that invention occurs in a flash, with a eureka moment that leads a lone inventor toward a startling epiphany. In truth, large leaps forward in technology rarely have a precise point of origin. At the start, forces that precede an invention merely begin to align, often imperceptibly, as a group of people and ideas converge, until over the course of months or years (or decades) they gain clarity and momentum and the help of additional ideas and actors. 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!”