Q: Have you ever heard of Bell Labs?

A: Of course. Bell Labs was the premier R&D organization in the world. Most of its work revolved around the telecommunications industry, but some of it ranged much wider.

Q: You said Bell Labs was the premier R&D organization in the world. What’s with the “was”?

A: Things changed over the years. Bell Labs had its official start in 1925, and was owned half and half by AT&T and Western Electric. Western Electric was AT&T’s manufacturing arm. And AT&T, of course, was better known as The Bell System. The corporation, incidentally, controlled about 80% of the country’s telephone systems.

Q: Did Bell Labs really invent a lot of stuff?

A: Yes. Their engineers and scientists received thousands of patents. A lot of them are pretty far out, but you’d recognize some.

Q: Try me.

A: The motion picture projector with synchronized sound. The laser. The UNIX operating system. The solar cell. Digital transmission of voice signals. Telstar Communications Satellite. Proof of The Big Bang theory. Light emitting diode (LED). And, of course, the most important: the transistor.

Q: Wow.

A: Yes. Eleven Bell Labs scientists shared six Nobel prizes.

Q: Sounds good. Did that change?

A: It sure did. In 1984 the Bell System was broken up. The operating company side of the house formed seven Regional Bell Operating Companies, called RBOCs, and the long distance, manufacturing, and R&D side of the house remained as AT&T. But since much of the efforts of Bell Labs were directed toward telephone operations, this left the operating companies high and dry.

Q: So what happened?

A: Bell Labs was split in two. Half of the people became part of an organization called Bell Communications Research, or Bellcore. Bellcore was owned by the seven RBOCs. The other half remained under the control of AT&T Technologies, the new name for Western Electric.

Q: That sounds fair. What happened next?

A: The seven RBOCs started competing with each other, and they weren’t too comfortable sharing an R&D organization with their competitors. Eventually Bellcore got sold.

Q: What about the part that remained with AT&T?

A: It stayed with AT&T Technologies – until that organization was spun off in 1996 and renamed Lucent, and is now Alcatel-Lucent.

Q: So what’s wrong with that? Couldn’t they keep on designing and developing stuff?

A: Yes, but, as you know, the industry has changed. Lots of competitors. So all that research and development has to eventually bring in dollars. And when a company is struggling to succeed and exceed, it can’t concentrate only on long-term benefits. It has to keep its eye on the bottom line.

Q: Not much fun. Is that what’s being done?

A: Yes. Projects are being set up very carefully. In fact, they are expected to pay back six times what was spent on research. Those with the biggest financial potential get the most funding.

Q: That sounds like a different world. Things change.

A: They sure do.