The Big Corporation and Scientific Management(Copyright © 2016 Piero Scaruffi)
The turn of the century witnessed the rise of the big corporation, that was often multinational too. The economic and political crisis of the 1890s (culminating in the financial panic of 1893 and in the war against Spain of 1898) encouraged companies to merge and consolidate. Global business had been enabled by fast transportation and communication. On one hand the 19th century had witnessed the transportation revolution with canals and railroads replacing travel by coach and wagon, that now allowed corporations to expand operations over a much larger territory. On the other hand the 19th century had witnessed the communication revolution, namely the telegraph replacing mail, which now allowed corporations to manage remote operations. The new corporation required a huge bureaucracy.
The electrical and mechanical factory that emerged at the turn of the century lent itself to optimization. The engineers brought a "scientific" culture to the big corporation and led the trend towards the scientific organization of the factory in order to minimize time and resources: efficiency, routines, standards. Basically, scientific management turned workers into machines. It introduced the time clock and the telegraph electric light, fire alarms Scientific management became a science in itself, aimed at discovering the fundamental principles of human skilled labor. It was invented by self-taught non-scientists such as Frederick Taylor, originally a steel worker in Philadelphia, and Frank Gilbreth, originally a Boston bricklayer. They introduced their ideas in engineering journals, not in academic classrooms. Taylor developed his method during the 1880s at Midvale Steel in Philadelphia.
The scientific organization of the corporation yielded economies of scale capable of changing the world more than wars did.
Unfortunately, this led to the formation of monopolies run by extremely rich and powerful men such as John Rockefeller (Standard Oil Company, 1862-1897), Theodore Vail (AT&T, 1885-1919) and Henry Ford (Ford, 1899-1945). These men often felt that they had a quasi-divine mission, or, better, a mission to create the industrial equivalent of the British Empire, that brought "civilization" to the entire world. These corporate titans reinvented capitalism as a quasi-divine mission to reform the world through the use of technology. They envisioned their monopolies as agents of good for the whole society. The utopian thinking of the early electric age turned into a sinister utopia of paternalistic imperialism.
The US government reacted by enacting the Sherman Antitrust Act in 1890 that was used to prosecute Standard Oil in 1909.
The same kind of consolidation took place in the world of communications. Within a few decades of its invention, each medium was controlled by an information empire: the telegraph was dominated by Western Union, the telephone by Bell (later renamed AT&T), the radio by NBC and CBS, cinema by the Hollywood studios, the electrical industry by General Electric and Westinghouse.
Taylorism had a counterpart in advertising. The advertising industry became more and more scientific, implicitly believing that any consumer could be manipulated into buying anything with the appropriate marketing campaign, not surprisingly given the rise of Psychiatry and Behaviorism due to books such as Sigmund Freud's "The Interpretation of Dreams" (1900), Carl Jung's "Psychology of the Unconscious" (1912) and John Watson's "Psychology as Behavior" (1913). The radio had become a particular favorite of the advertising industry because the message reached a much larger number of people than the traditional billboard.
Adam Smith had spoken of the "invisible hand" of the market in shaping the economy, but the very visible hand of scientific management became at least as important. Railroad companies were the prototype of the big corporation because they needed to do business over a large territory, moving both goods and people, having to synchronize offices and stations scattered across states and cities. By 1880 the population of the USA had passed the population of Great Britain.
Some of the inventors of scientific management went on to establish a quasi-political movement called Technocracy that advocated a society run by engineers, not politicians. The economist Thorstein Veblen founded in New York the free New School for Social Research in 1919 with historian Charles Beard and philosopher John Dewey and in the same year published the series of articles that would be collected in "The Engineers and the Price System" in which he proposed a soviet of engineers. He basically predicted that enginers, not workers, would overthrow capitalism. Veblen's "soviet of technicians" became the model for the Technical Alliance, established in New York at the end of the same year by Howard Scott, who was known as the Bohemian engineer of Greenwich Village. Both had been preceded by The New Machine, established in 1916 by Henry Gantt, the engineer who had worked with Taylor at Midvale and had invented the Gantt chart to control factory operations. In 1932 Howard Scott would form with a scholar of Columbia University, Walter Rautenstrauch, the much more publicized Committee on Technocracy that advocated a rational society run by engineers.
The Farm(Copyright © 2016 Piero Scaruffi)
The countryside was being rapidly electrified in Europe because of government programs, whereas in the USA it was largely left in the dark. In 1910, when the majority of northern European farms had electricity, only 2% of US farms did. It was costly for the utilities to bring electricity to the rural towns and therefore difficult to make a profit. This created a vicious loop: country people were encouraged by electricity to move to the city, therefore further reducing the motivation for utilities to provide the country farms with electricity. The lucky farms were the ones that happened to lie along the lines of the interurban trolleys or the lines of the dams. For example, California was ahead in rural electrification because of the vast network of trolleys in the Los Angeles area and because of the Folsom dam that powered Sacramento.
If the utilities had no interest in electrifying the rural world, the manufacturers of electric tools and appliances did. Both General Electric and Westinghouse were eager to sell electric generators, tools, machines and appliances to the farms. In 1925 General Electric exhibited an all-electric farm at the State Farm Products Show held at Harrisburg in Pennsylvania. 1929 10% of the farms of the USA when France and northern European countries easily had achieved 90%.
There was one notable exception. The region just east of Los Angeles is crossed by the Santa Ana river, the largest river in southern California. In 1850 (two years after being annexed by the USA from Mexico) California's population was 165,000 and Los Angeles' population was 8,329. In 1851 Utah Mormons purchased the San Bernardino ranch and built an agricultural community using water from the Santa Ana river. They failed and returned to Utah, but their example was copied in 1857 by German immigrants in another location near the Santa Ana river, Anaheim, and these farmers set up a collectively-owned water company. In 1870 a group of farmers from Tennessee purchased a Mexican ranch in Riverside and created a vibrant irrigation community by diverting the waters of the Santa Ana river. Besides the new settlers, the region also benefited from an injection of cheap farm workers, mostly Chinese, at the end of the Gold Rush. Then in 1874 a lady named Eliza Tibbets received three orange trees from Brazil. By sheer coincidence two years later the railroad San Francisco - Los Angeles was inaugurated. Tibbets had accidentally started a craze for citrus trees. Riverside prospered and expanded its irrigation canals. Until then California's main agricultural product was wheat, that was also easy to export because it doesn't require refrigeration.
Inspired by the success of Riverside, the Canadian investor George Chaffey bought land near the San Antonio river and created the irrigation colonies of Etiwanda (1881), Ontario (1881) and Upland (1882), each of them equipped from the beginning with electric street lights and an electric trolley, thanks to hydroelectric power plants, and each of them served by a water pipeline made of concrete.
Chaffey jumpstarted Ontario's cooperative agriculture by planting tens of thousands of fruit trees. Marketed as "model colonies", Chaffey's new towns attracted thousands of immigrants from the eastern states and from Canada.
In 1887 the Santa Fe railway reached Los Angeles, equipped with the refrigerated car invented in 1880 by Gustavus Swift in Chicago, and started operating trains to Texas and all the way to Kansas, with a station in Ontario. In 1889 the first cooled shipment of fruit from California to east took place. Fruit eventually replaced wheat as the main produce of California, and other citrus towns prospered around Los Angeles: Pasadena (an Indiana colony), Redlands (a Chicago colony) and Pomona. The whole region experienced a "land boom". Chaffey and other speculators got immensely rich.
The first hydroelectric plant in California was built in 1887 by Gustavus Newman in Riverside, harnessing the power of the Highgrove waterfall, for a San Francisco investor, Charles Lloyd: three waterwheels and three direct-current dynamos to produce electricity for 15 arc lights. Then Almarian Decker built his the San Antonio plant (1892) and the Redlands plant (1893). By then southern California had become one huge citrus field, and half of the citrus trees were in Riverside. In 1895 Riverside enjoyed the richest per-capita income in the USA.
Chaffey's 1903 hydroelectric plant for Ontario combined irrigation and electricity, setting a new standard that was exhibited at the St Louis World's Fair of 1904. Both the water and the electricity were owned by the people in sharp contrast with the private utilities of the eastern cities.
Electricity altered California's economy, launching its agricultural boom: electricity made ice for storage of produce, pumped water for irrigation and, later, drove automated packing lines.
California was the exception. The farms in the rural regions in the USA had no electricity or had to generate their own, despite the fact that until 1920 most of the US population lived on farms, not in cities (according to the national census). The only electrical luxury that spread in the countryside was the radio because manufacturers sold battery-operated radios. This would remain the case until Franklin Roosevelt's "New Deal" that established the Tennessee Valley Authority or TVA (1933) and the Rural Electrification Administration or REA (1935), and constructed the Hoover Dam on the Colorado river (1936).
The utilities feared the REA but the electric manufacturers loved it. That's when General Electric decisively switched business and started focusing on home appliances and office machines. At the New York World's Fair of 1939 General Electric's pavilion would exhibit more than 100 products for agriculture in its "Electrified Farm".
Office Machines(Copyright © 2016 Piero Scaruffi)
At the turn of the century, the big corporation was pioneering more sophisticated ways to produce and distribute goods and on a much bigger scale. This required an army of employees whose job was to handle data. Regulating the corporation also required establishing routines, and even routines for those establishing the routines: a pyramid of bureaucracy. This bureaucracy created new professional careers, particularly for women. By 1900 about 12% of the working population in the USA was employed to handle data, as compared with 25% in manufacturing. The railroads were again the pioneers in adopting office equipment to handle data: equipment for communications (the telegraph and the telephone), for writing letters (typewriter), for collecting data (tabulators) and for calculations (adding machines).
While typewriters had been built for personal use since at least Pellegrino Turri's 1801 machine, the first practical typewriter had been invented in 1868 by Wisconsin newspaper publisher and senator Christopher Sholes, who in 1873 also conceived the QWERTY keyboard.
In 1874 the first commercial typewriter, based on Sholes' design, was produced by the gun-manufacturing company founded in 1816 near New York by Eliphalet Remington that had prospered during the Civil War of 1861-65. Sholes was certainly inspired by the machine built in 1860 in Alabama by attorney and journalist John Pratt, a sort of desk-based printing press; but Remington's mass-production technique and machining skills (acquired by making weapons) and Remington's line of sewing machines (that provided the physical model for the first model) were crucial for the practical manufacturing of Sholes' invention. Mark Twain's "The Adventures of Tom Sawyer" (1876) was the first major book to be written on a typewriter.
In 1886 Remington's typewriter business was acquired by employees of the company, although it retained the original name. In 1880 the American Writing Machine Company of New York started selling the Caligraph typewriter, that had separate keys for lowercase and uppercase letters. In 1887 another gun manufacturer, operated by the brothers Lyman Smith and Wilbert Smith in Syracuse (New York), launched into the typewriter business when their employee Alexander Brown designed one (the company was renamed Corona in 1914). Initially, the typewriter's biggest problem was social stigma: people resented being sent a typewritten letter instead of the handwritten letter that they were used to. But eventually the typewriter's advantages won over both businesses and households: it was faster to type a letter, it was easier to read a typed letter, and the size of the typewriter forced a standard on the size of the letters themselves.
Last but not least, carbon paper allowed the typist to produce multiple identical copies of a document instantaneously. Pellegrino Turri had actually invented the typewriter in Italy in 1801 to help his blind lover write letters to him. He had also been the first to use carbon paper, although the purpose was not to make copies but simply to provide a sheet of ink.
Ralph Wedgwood in England had understood that carbon paper could be used to make copies of (handwritten) documents. However, carbon copies of handwritten documents were legible only if the writer was strong enough to put a lot of pressure on the paper. In 1870 Lebbeus Rogers founded a company in New York to produce carbon paper. One of the most time-consuming jobs in the office was to make copies of documents. They were done by hand and doublechecked by two or more people. In 1880 David Gestetner in Austria invented the stencil duplicator (the cyclostyle), the first office machine to duplicate documents, and then opened a successful company in England in 1881. In 1887 Albert Dick, who owned a lumber business in Chicago, introduced a stencil duplicator based on a Thomas Edison design and called it the "Edison mimeograph".
But the arrival of the typewriter combined with the carbon paper (sold by both Rogers and Dick in the USA) made it possible to produce a document directly in several copies, although not as many as the cyclostyle.
As the typewriter was adopted by journalists, professionals, businesses, governments, and eventually households, the number of inventions multiplied, producing better and cheaper models: In 1890 George Blickensderfer of Connecticut introduced a portable model. In 1891 James Daugherty of Pennsylvania introduced the first typewriter designed so that the typist could see what she was writing, followed by a similar model in 1895 by Thomas Oliver in Chicago. In 1896 John Underwood, who originally had supplied typewriter ribbon and carbon paper to Remington, started selling the typewriter invented by Franz Wagner, and became the world's largest typewriter manufacturer thanks to the Model 5 of 1900.
These typewriters seriously undermined the business of Remington, Smith and American Writing Machine, that were still making "blind writers", upstrike typewriters in which the typist could not see what she was typing. In 1893 Remington, Smith and American Writing Machine formed the Union Typewriter and initially tried to oppose the vogue of the "visible" typewriter but in 1904 they jointly created the Monarch to produce lowstrike typewriters (Monarch was eventually absorbed into Remington).
One particular typewriter was the "book typewriter", popularized by the Elliott & Hatch Book Typewriter Company of New York in 1897, a typewriter that typed on bound books such as bookkeeping ledgers. The Fisher Book-Typewriter Company of Ohio introduced a product in 1901. The two companies merged in 1903 to become Elliott-Fisher, the nation's main producer of bookkeeping machines.
In 1906 Edward Rees launched the Royal typewriter in New York, a flatbed model. In Europe the leaders were AEG's Olympia (Germany, 1903), Camillo Olivetti (Italy, 1908) and Hidalgo Moy's Imperial (England, 1908). While not electrical, the typewriter was the main driver of the office revolution at the turn of the century.
The first electric typewriter was introduced in 1902 by George Blickensderfer, the "Electric Blick", a QWERTY keyboard with automatic carriage-return and line-spacing; but of course very few homes and offices had electricity at the time.
The technique of the player piano was employed in the "automatic typewriter" invented by Thomas McCall in Ohio in 1906 (but manufactured in 1912 by the National Automatic Typewriter Company of Earl Hooven, and thus known as the "Hooven") for the purpose of producing multiple copies of the same letter: the letter was typed on a machine that punched holes in a roll of paper, and the paper roll was fed to an electric machine that turned each hole into the pressing of a typewriter's key.
In 1879 Ohio saloon-keeper James Ritty invented the cash register, and Jacob Eckert improved it and in 1884 founded the National Manufacturing Company. Their invention was acquired by John Patterson who in 1894 founded the National Cash Register (NCR) in Ohio to manufacture such mechanical cash registers. The difference between the cash register and other office inventions of the time is that the cash register went to retail shops, not to white-collar offices nor to factories nor to government agencies. It was visible by all people. The reason for its rapid adoption by small shops is that it helped stem theft by clerks of the shop, but soon the customers also started liking the receipt that allowed them to doublecheck totals and to return items (introduced a few years later). In 1906 NCR's employee Charles Kettering came up with the first major invention of his career: the cash register powered by an electric motor.
NCR flourished and became a de-facto monopoly (one of the first companies to be sued by the government under the Sherman Antitrust Act) thanks to the business acumen of Patterson who introduced new ways to sell products: a periodically-printed catalog (since 1887), a training school for salesman (that opened in 1894), quotas for salesmen, sale territories (a practice already common at Singer), and even tours of the factory as a tourist attraction. Patterson basically built a nation-wide network of highly-skilled sales force and armed it with nonstop printed propaganda.
Kettering went on to found Delco (Dayton Engineering Laboratories Company) in 1909 in Ohio with his NCR coworker Edward Deeds, and to invent the electric starter for cars.
The mechanical calculating machine had existed since at least 1851, when Thomas de Colmar (who had originally conceived it decades earlier) had successfully demonstrated his "arithmometer" at the Crystal Palace Exhibition of 1851 and started selling it (Charles Babbage and Ada Lovelace's analytical engine, that was designed to use Jacquard's punched cards, was never built). Several clones surfaced in Germany (by Arthur Burkhardt since 1878) and in Britain (by the brothers Charles and Edwin Layton since 1883), while Colmar's engineer Louis Payen took over the original French firm in 1887.
Before the invention of calculators, scientists and engineers own volumes of tables. One could simply look up the result of a mathematical operation, whether a multiplication or a logarithm. Those tables were made by humans and contained countless mistakes. Therefore people like Charles Babbage in England tried to build machines capable of calculating those tables automatically. Babbage never succeeded, but an article published in 1834 publicized his design for a "difference engine". Georg Scheutz and his son Edvard in Sweden built such a machine based on Babbage's design and with funding from the government, first demonstrated in 1854 and then exhibited at the Universal Exposition of Paris in 1855, eventually acquired in 1857 by the Dudley Observatory in the USA (near New York).
George Grant in Boston exhibited a similar machine at the 1876 Centennial International Exhibition in Philadelphia.
Due to the limited technology of the time, these were (mechanical) machines that required significant investment over a number of year.
Pinwheel calculators based on Colmar's arithmometer were "invented" in 1874 by Frank Baldwin in St Louis and in 1874 by Willgodt Odhner, a Swedish designer of industrial machines living in St Petersburg (Russia). The latter was mass produced after 1890 in Russia and after 1892 in Germany by Brunsviga, a sewing-machine company was already selling Baldwin's machines. These machines were smaller than the bulky Colmar type but much smaller, occupying only the corner of a counter.
The next step was the simplification of input and output. In 1885 William Burroughs in Missouri developed his adding machine and founded the Arithmometer Company, and in 1886 Dorr Felt in Chicago introduced his "comptometer". Burroughs' main innovation was the "lister" coupled with the "adder": his machine printed the result. Felt's main innovation was the key: the arithmometer used a dial, and other adding machines used levers, but Felt's comptometer used columns of numbered keys. Previous arithmometers required setting levers and then turning a crank, a rather awkward operation. By the year 1900 Burroughs and Felt were the dominant players in the desktop calculator market. Railroad and banks were the early adopters, followed by government agencies.
These calculators were unable to perform a direct multiplication: they calculated multiplication as repeated additions. In 1881 the Russian mathematician Pafnuty Chebyshev had already demonstrated how to build a truly multiplicating machine, and French car manufacturer Leon Bollee had built one in 1889, but it was a Swiss engineer living in Germany, Otto Steiger, who in 1893 introduced the first calculator capable of direct multiplication, renamed the "Millionaire" in 1895 when Hans Egli in Switzerland took over the production, thereby launching the industry of calculators in Switzerland.
Unlike the typewriter, that was initially resisted because handwritten notes were considered more polite and elegant, the calculators were immediately welcomed by their natural users: the businesses that employed armies of bookkeepers and accountants. The rise of the mechanical calculator paralleled the rise of the big corporation: until the financial panic of 1893 these inventors struggled to find a market, but towards the end of the decade their revenues skyrocketed. Not only did calculator speed up calculations, but it was also infallible. Two companies came out of St Louis (Missouri) in 1903 with a new invention, that was to become a sensation during the 1904 World's Fair in St Louis: the ten-key adding machine. The comptometer had several columns of nine keys: it was heavy, costly and cumbersome. The ten-key adding machine had simply the 10 keys set on one row, plus one row with nine tabulator keys. The machine, initially sold by the Addograph Manufacturing Company, was invented in 1901 by the pastor William Hopkins (his brother Hubert ripped him off), and the funding came from James Dalton, and eventually in 1909 the company changed name to Dalton Adding Machines. William continued selling them as the Standard Adding Machines, while his unscrupulous brother Hubert in 1903 founded with John Moon and Carey Crawford the Moon-Hopkins Billing Machine Company. By 1907 Standard's machines could also add fractions, subtract, multiply and divide.
Other companies soon joined the ranked of the adding machines market, notably DeKernia Hiett's Universal Adding Machine and Halcolm Ellis' company that sold Nathan Perkins' adding machine that would evolve in a combination adding machine and typewriter (marketed by the renamed Ellis Adding-Typewriter Company), making St Louis (known as "the fourth city" at the turn of the century) the center for this burgeoning industry.
Finally, the adding machine got electrified at the beginning of the new century, when lamp sockets were becoming more common. Frank Rinche's machine of 1903, marketed by his Universal Accountant Machine Company of St Louis, replaced the hand crank with an electric motor. Both William Pike of New Jersey (a former Burroughs inventor) and Emory Ensign of Boston introduced electric models in 1905, and the Pike later also had a "visible" printer instead of the traditional printer hidden in the back. The American Arithmometer Company, renamed Burroughs Adding Machine Company after the death of the founder and run by Joseph Boyer since 1903 and relocated to Detroit, advertised an electric model in 1906 (and purchased Pike in 1909); and an electric model was introduced in 1908 by the Commercial Adding and Listing Machine of Connecticut.
In 1908 Brunsviga launched the world's first printing calculator, the Trinks-Arithmotyp, designed by its chief engineer Franz Trinks.
One of the most successful manufacturers of adding machines was born much later: Carl Buehler founded Victor in 1918 in Chicago and introduced his first adding machine, the Model 110, designed by Oliver Johantgen, in 1919.
In 1870 a clerk of the Census Office named Charles Seaton invented a mechanical tabulating machine to process the data of the national census of 1872. It used a roll of punched paper. The mechanical tabulators provided the first help to data processing. Herman Hollerith had studied in New York, worked for the Census Bureau in Washington and taught at the MIT in Boston. At the MIT he realized that punched cards could be a flexible and efficient method to store information. In 1884 he moved back to Washington to work at the Patent Office and built his first machine, an electric tabulating device that used cards instead of rolls and that was electrical instead of mechanical. His machine was a conceptual successor of Morse's telegraph: like Morse's telegraph, it used a binary code (hole/ no hole instead of dot/line); and, like Morse's telegraph, it invented a method to store information on a medium that a machine can read. In 1887 Baltimore's Department of Health used his machine to study mortality statistics. In 1889 Hollerith exhibited his electric tabulator at the Universal Exposition of Paris. The breakthrough came when the Census Office adopted his machine for the 1890 census, with punches made by Pratt & Whitney and counting machines made by Bell's Western Electric division. For the first time, the data about an individual were turned into a series of bits (a pattern of holes).
Punched cards had been used for automating the textile industry since at least Joseph Jacquard's power-loom in France in 1801, and the idea of using holes to represent information dates even earlier in the textile industry (e.g. Basile Bouchon's paper tapes of 1725, also to control looms). Jacquard had realized that weaving consists in a series of repetitive actions which can be automated. The pattern of holes in a card programmed the actions of the loom. The first "programmers" were textile workers.
Hollerith used the punched card as a way to activate a series of relays. Relays were used in the telegraph industry as amplifiers, but a relay can also work as a switch. Hollerith's machines were used in the national census until 1900.
Another likely influence was the player piano, a musical automata that was programmed by a roll of punched paper. Three kinds of player pianos had been exhibited in 1876 at Philadelphia's Centennial International Exhibition, and John McTammany's automatic organ, or "organette", had debuted in 1881 in Boston.
In 1883 Emil Welte, a German immigrant who came from a family of builders of musical instruments, had introduced in New York the perforated paper roll for musical automata, another innovation based on the Jacquard card. Hollerith, therefore, built on a tradition of using the paper hole as a programming tool.
In 1890 the USA's population was 62 million. Hollerith's next big contract was for the Russian census of 1897: Russia's population was 129 million. Early adopters of electric tabulators were insurance companies (Prudential, 1891), railroads (the New York Central Railroad in 1895), retailers (Marshall Field in Chicago, 1902) and manufacturers (Pennsylvania Steel, 1904).
In 1906 Hollerith introduced the (mechanical) Type 001 keypunch, a card punch (for 45-column cards) operated from a keyboard, which greatly improved the productivity of operators, and that was electrified in 1923 (the Type 011, still for 45-column cards).
In 1908 another Census Bureau clerk, James Powers (actually a Russian mechanical engineer whose real name is not known), invented an improved (albeit still mechanical) tabulation machine, and in 1911 founded his own Powers Accounting Machine Company in New Jersey that in 1914 already had a printing tabulator. In 1911 the financier Charles Flint bought Hollerith's company, merged it with three others into the Computing-Tabulating-Recording Company (CTR), hired former NCR sales executive Thomas Watson in 1914 to run it, and renamed it International Business Machines (IBM) in 1924. Watson transplanted NCR's sales organization into CTR. Watson was managing three companies in one because at that point C-T-R had three souls: Tabulating Machine, Hollerith's old company, whose main source of revenues in 1914 was actually the sale of cards, followed by equipment rental; Computing Scale, a manufacturer of scales for weighing industrial products; and the International Time Recording Company, that in 1914 accounted for most of CTR's revenues. The latter, founded by Willard Bundy in 1888 in the north of New York state, and led by George Fairchild since 1900, manufactured mechanical clocks used in factories and offices to mark the hours worked by employees. Initially, Fairchild was appointed chairman and Watson president, but Fairchild died in 1924. World War I was a blessing for the new company because the army became a major customer. In 1917 CTR introduced its printing tabulator and in 1923 the electric keypunch, and in 1928 IBM introduced the 80-column card.
Most of these innovations originated from the engineers of the International Time, relocated by Watson to nearby Endicott: they invented the electric keypunch in 1923, Clair Lake (a former automobile designer) built their printing tabulator in 1919, Fred Carroll (who had designed cash registers at NCR) designed the rotary machine for the production of cards (also in 1923), and their chief engineer James Bryce (IBM's most prolific inventor, credited with more than 400 patents) developed all the equipment for the 80-column card.
In 1927 Powers' company was acquired by Remington Rand, born that year from the merger of Remington, and the largest office supply company in the USA, Rand Kardex, and headed by James Rand, inventor of Kardex's card-based record-keeping system. Both Dalton and Standard were also acquired in the same deal.
The typewriter, the telephone, the tabulator and the adding machine were necessary tools for the big corporation to deal with the accelerating speed of transportation, communication and manufacturing. These new tools, conversely, helped big organizations collect more data. Statistics became more common and, in turn, required more data-handling machines. It was a self-reinforcing loop. Women benefited from this generation of office machines: women found employment as typewriters, telephone operators and accountants.
These inventions greatly benefited the newspapers, but the new batch of newspapers (the New York World started in 1893 by Joseph Pulitzer and the New York Journal started in 1895 by William-Randolph Hearst) used the new tools mainly to focus on sensationalist reportage about crime, corruption, sex and disaster.
Early into the 1910s the full-keyboard comptometer of Felt was still the dominating calculator, but in 1911 Burroughs, that in 1908 had acquired Universal Adding Machine and in 1909 Pike, introduced a very similar full-keyboard calculator. Baldwin initially had his machines manufactured by Reliance Machine Works of Philadelphia but in 1912 Jay Monroe, the chief clerk of Western Electric in New York, founded a company specifically to sell Baldwin's calculators. In 1911 Rodney and Alfred Marchant in Oakland (California) began selling one of the many clones of the Odhner arithmometer, but in 1918 their chief engineer Carl Friden built an original model that established the company as one of the most innovative in calculators.
In 1914 Oscar Sundstrand's Rockford Milling Machine Company in Illinois started selling an adding machine, invented by his older brother David, that arranged the ten digit keys in a 3 by 3 configuration with the zero underneath, a setting that would become the standard for many years.
In 1925 Burroughs (now run by new president Standish Backus) introduced a portable adding machine, and in 1928 introduced an electric calculating machines.
In 1929 Remington Rand acquired the ten-key machine invented by Thomas Mehan of Chicago, briefly sold as the Brennan. and in 1934 it acquired United Accounting Machine and its punched-card multiplier, that multiplied two numbers punched on a card and punched the result.
In the Bay Area the genius of calculators was Carl Friden, who in 1934 left Marchant and started his own company in Oakland to make sophisticated and expensive electromechanical calculators.
The 1920s were also the decade of the bookkeeping machines, that combined technology from calculators and typewriters. Not surprisingly the leaders in each category followed a different path to arrive at the same type of product. In 1921 adding machine firm Burroughs purchased the Moon-Hopkins Billing Machine Company, whose electric machines (the "moons") combined a typewriter with a calculator, a novelty at a time when most calculators were only numeric.
In 1927 typewriter firm Underwood acquired Sundstrand and Elliott Fisher. In 1928 cash register firm NCR licensed the Ellis technology and developed the Class 3000 bookkeeping machine, the successor to the Class 2000 of 1926.
In 1934 IBM introduced the 405 alphabetic bookkeeping and accounting machine, perhaps the supreme technical achievement in this sector.
Clearly, all the major firms were trying to diversify and step across the boundaries of the market for office machines.
The electric typewriter became popular after the success of the Electromatic, introduced in 1929 by the Northeast Electric Company of Rochester (New York state) that in 1925 had made Remington's first electric typewriter. In 1931 the renamed Electromatic built a prototype automatic typewriter that used a roll of paper like the a player piano roll. In 1933 IBM purchased Electromatic and renamed the automatic typewriter as the IBM Model 01. This typewriter could punch holes in the tape and then read the tape. The holes worked as a memory. One could punch a tape representing a standard letter to customers and the typewriter would reproduce that letter over and over again. Then a human typist could enter the specific name, address and figures for that customer. These machines represented the prehistory of the word-processor, typewriters that could record and play back typed text.
In 1946 the Commercial Controls Corporation (CCC), which sold postal machines and guns, acquired IBM's Rochester factory and the team of the Electromatic (or Model 01), and continued developing the technology of the "automatic" typewriter, the tape-controlled typewriter that it renamed Flexowriter. During World War II the Flexowriter was used by the navy to automatically type the "regret to inform you" letters to the families of fallen marines.
By the end of the 1930s the main suppliers of accounting machines in the USA (not counting punched-card machines) were (by market share): Burroughs, NCR, Underwood, and Remington Rand. The main suppliers of adding machines were (by market share): Burroughs, Underwood and Remington Rand. The main suppliers of calculators were (by market share): Monroe, Marchant, Felt, and Burroughs. The main suppliers of typewriters were (by market share): Royal and Remington Rand.
During the 1920s and 1930s the use of tabulating machines increased exponentially. IBM and Remington Rand competed in providing all sorts of punches, sorters and tabulators. They both sold typewriters too, because the customer was often the same. In the 1930s the government sued both under the Sherman Antitrust Act. By then IBM was controlling 88% of the tabulating market and Remington Rand the remaining 12%: IBM's equipment was mostly electric, Remington Rand's mostly mechanical.
A data-processing room was a collection of electromechanical machines for different purposes (such as tabulators and multipliers), a busy place with human operators running from one machine to the other with decks of punched cards. The punched card was the universal lingo of data processing.
The first scientist to use punched-card tabulators for scientific calculations was the New Zealand-born astronomer Leslie Comrie at the British Nautical Almanac Office, who in 1928 modified an NCR bookkeeping machine to compute trigonometric functions and the phases of the Moon. His example was followed by another astronomer, Wallace Eckert, at Columbia University in 1933, using IBM equipment donated by IBM's boss Thomas Watson. In 1932 Comrie even showed British IBM how to modify their tabulator so that it would simulate Babbage's difference engine. These machines were programmed via a plugboard, by plugging and unplugging wires in appropriate ways. In 1935 this idea evolved into the IBM 601 multiplying punch, built using relays, which remained for years the preferred machine for scientific calculations.
One problem in communications was still unsolved: how to transmit images quickly like the telegraph transmitted texts and the telephone transmitted voice. Air mail was mainly used by banks to send checks and other financial documents quickly. But it wasn't truly "air" mail because planes could fly only in daylight. Pilots flew very low because they had to follow roads and railroads; and at night the mail was loaded on trains and taken to the next airport. In 1924 the Post Office inaugurated coast-to-coast air mail thanks to the completion of a lighted transcontinental airway of dozens of beacons at more or less regular intervals. The airplanes took 34 hours to fly from New York to San Francisco.
The only practical tool to transmit images was the pantelegraph, invented by the Italian priest and physicist Giovanni Caselli. It combined pantograph (a tool used to copy drawings) and telegraph, and it had started operation between Paris and Lyon in 1865.
In 1906 Arthur Korn in Germany demonstrated the wireless transmission of images, the ancestor of the radiofax. In 1913 Edouard Beeline in France invented the technology that enabled the fax machine, sending images over the existing telephone and telegraph networks. Finally, in 1921 Western Union introduced a new electrical novelty, the wirephoto. In 1924 Swedish-born inventor Ernst Alexanderson (General Electric's most prolific inventor, receiving more than 300 patents) transmitted the first image across the Atlantic. In 1925 AT&T introduced its own wirephoto and RCA followed up in 1926. By 1925 it was possible to transmit telefaxes across the continent and in 1926 RCA inaugurated the first transatlantic telefax services, that the New York Times immediately used to publish a picture coming from London.
In 1899 Donald Murray in Australia expanded the Baudot code with control characters such as the CR (carriage return). This became the Western Union standard and in 1924 it was adopted as the International Telegraph Alphabet 2 (ITA2).
In 1924 Frederick Creed in Britain acquired the rights for Murray's code and introduced his first teleprinter, the Model 1P.
During the Great Depression, that witnessed record unemployment, office machines were frequently blamed for taking people's jobs.
The high-tech corporations invested in the research laboratory: AT&T's Bell Labs (1925), IBM's Endicott labs, General Electric's Schenectady labs, Kettering's lab at NCR (that had created an "inventions department" already in 1888), etc. Also important were the new schools of Electrical Engineering, notably the Moore School established in 1923 at the University of Pennsylvania.
However, very little innovation followed the crazy pace of innovation at the turn of the century. The typewriter remained pretty much what it was in 1900. So did the cash register. Punched-card tabulators and adding machines did not improve much after 1915 (tabulators would eventually be displaced by computers and adding machines by the battery-operated pocket calculator). What greatly increased was the use of these tools. The USA led the way into automating data processing. Perhaps the dramatic increase in population over such a vast territory accounts for the willingness of politicians and businesses to adopt data-processing technology. In 1940 the USA's population passed 130 million.
Television(Copyright © 2016 Piero Scaruffi)
The Bay Area(Copyright © 2016 Piero Scaruffi)
In 1925 Fred Terman (who meanwhile had graduated at the MIT under Vannevar Bush) joined Stanford University to work at Ryan's radio-communications laboratory. Terman didn't just perfect the art of radio engineering. The Bay Area offered precious few opportunities for employment, and during the Great Depression that started in 1929 virtually none. Terman encouraged his students to start their own businesses. Many of his students were coming from the East Coast. He encouraged them to start businesses in the Bay Area. He viewed the university as an incubator of business plans. It was a step up from Harris Ryan's philosophy of encouraging cooperation between academia and industry. In 1939 Terman's students William Hewlett and David Packard started Hewlett-Packard in a Palo Alto garage to commercialize the resistance-capacity oscillator built by Hewlett in 1935. Their first customer was the Hollywood animation company Walt Disney that used their oscillator for the film "Fantasia", one of the biggest blockbusters of the time.
But it was radio engineering that truly jump-started the high-tech industry in the Bay Area. In 1926 Heintz & Kaufmann, founded in San Francisco by Ralph Heintz, a former radio amateur and employee of Earle Ennis, started manufacturing their own vacuum tubes to compete with RCA. In 1932 ham-radio hobbyist Charles Litton started Litton Engineering Laboratories at his parents' Redwood City home to manufacture tools for vacuum tube manufacturers (a job that he had just quit at FTC). In 1934 Heintz's employees Bill Eitel co-founded Eitel-McCullough (later Eimac) to develop better vacuum tubes for the ham-radio market which would become the Armed Forces' favorite tubes during World War II. Another FTC employee, German-born Gerhard Fisher invented the metal detector in 1928, and founded Fisher Research Laboratories in 1931 in his Palo Alto garage.