Geoffrey recently warned of the perils of centralized innovation. In contradistinction to that very warning, I came across this footnote (chapter 14, footnote 3) in Friedrich A. Hayek’s famous ‘The Road to Serfdom‘:
The case of the alleged suppression of useful patents is more complicated and cannot be adequately discussed in a note; but the conditions in which it would be profitable to put into cold storage a patent which in the social interest ought to be used are so exceptional that it is more than doubtful whether this has happened in any important instance. [emphasis in original]
In Hayek’s favor, there was no internet or WikiLeaks back then (but then again, perhaps that was AT&T’s fault!)
Gizmodo has an interesting post about How Ma Bell Shelved the Future for 60 Years. It is an excerpt from The Master Switch by Tim Wu.
Here is the money quote:
This is the essential weakness of a centralized approach to innovation: the notion that it can be a planned and systematic process, best directed by a kind of central intelligence; that it is simply of matter of assembling all the best minds and putting them to work in unison. Were it so, the future could be planned and executed in a scientific manner.
Yes, Bell Labs was great. But AT&T, as an innovator, bore a serious genetic flaw: it could not originate technologies that might, by the remotest possibility, threaten the Bell system. In the language of innovation theory, the output of the Bell Labs was practically restricted to sustaining inventions; disruptive technologies, those that might even cast a shadow of uncertainty over the business model, were simply out of the question.
~*~
Cross-posted at Prometheus Unbound.
