IP: AT&T Cambridge labs shuts down

[Dave Farber <dave () farber net>]

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------ Forwarded Message
From: Paul Saffo <psaffo () iftf org>
Date: Wed, 24 Apr 2002 11:03:49 -0700
To: Dave Farber <farber () cis upenn edu>
Subject: AT&T Cambridge labs shuts down


<http://www.guardian.co.uk/Archive/Article/0,4273,4398235,00.html>
Wrangling money men shut down the future
John Naughton mourns the passing of AT&T's Cambridge telecommunications lab
Observer
Sunday April 21, 2002

The AT&T Laboratories in Cambridge closes next Wednesday. Some will
interpret their demise as just another consequence of the
technophobia that has supplanted the irrational exuberance of the
dotcom era. Others will see the axing of Europe's leading
communications research laboratory as an act of mindless corporate
vandalism.

Both interpretations are wrong. The truth is that Intel wanted to buy
the lab and was on the brink of closing a deal. Although nobody in
AT&T will talk openly about it, the word on the street is that
negotiations foundered because the lawyers on both sides couldn't
agree about intellectual property issues.

This eleventh-hour failure is a disaster because it shatters
something magical. A great research laboratory is a very delicate
organism - rather like a great symphony orchestra. It takes years to
create, and very skilled management to keep it vibrant. Once broken
up, it is impossible to put it back together again.

Sometimes these strange social organisms run out of creative steam
and deserve to die. But the AT&T lab was not one of these. In fact,
in the last years of its life it invented what many of us thought
would be one of the defining communications devices of this century
(and, incidentally, the salvation of its telco owner) - the broadband
phone.

This gizmo looks like a phone but is actually a simple networked
computer. You can dial numbers on the virtual keypad displayed on its
screen and make traditional voice calls on it. But you can also do a
visual check on whether there is a space in the office car park, or
see who rang your doorbell, or draw sketches that the other caller
can annotate in real time. You can play chess with callers, or browse
the net or read email or do a thousand other things - because it's
really a computer that happens to do telephony.

When AT&T first bought the lab, its senior executives were poleaxed
by the phone. Their chief executive even showed it off to Bill Gates.
But as the company started its long slide down the telco chute, AT&T
execs forgot about it. So instead of creating a new future for the
humble telephone, these amazing devices invented in Cambridge will
probably wind up in a skip.

The broadband phone was just the latest in a long line of innovative
technologies spewed out by the lab's 50-odd researchers over 15
years. Others included: the active badge system, which enabled a
building to locate any of its occupants wherever they happened to be;
the 'virtual network computer' -- a wonderful software system now in
daily use in millions of locations across the world; low-power
embedded-radio technology; and some stunning systems for the
automated indexing and retrieval of multimedia content.

During its brief life, the lab also spun out a number of successful
companies - one of which, Virata, is now a global leader in
communications hardware and software for internet access equipment
suppliers.

At the last count, approaching 100 of the lab's alumni had become
millionaires as a result of participation in these spin-outs.
Chancellor Gordon Brown often laments the inability of British
researchers to capitalise on their ingenuity. Yet here in Cambridge
was a living, breathing refutation of his despairing pessimism. And
it's closing this Wednesday - because two groups of American
corporate lawyers could not reach an agreement about intellectual
property.

The lab was founded in 1987 by Herman Hauser and Andy Hopper as the
Olivetti Research Laboratory. Both co-founders had taught at the
university's computing laboratory and had been involved in Acorn, the
company that made the BBC Microcomputer.

Olivetti had bought Acorn when it ran into difficulties. After a
short period, Hauser left to embark on a career as a successful
venture capitalist. Hopper - who remained an academic throughout and
is now a professor of communications engineering - became sole
director.

> From the outset, the lab was a limited company owned by Olivetti,
rather than a department of the Olivetti organisation. This turned
out to be an important distinction, because it gave Hopper a degree
of freedom that he would not have enjoyed as an executive of a
conglomerate.

Over the years, ownership of the lab changed, but it retained its
status as a separate company. First Digital came in as co-owner, to
be replaced some years later by Oracle.

In the end, Hopper decided to look for a more stable proprietor and
came up with AT&T, which agreed to fund the lab's activities to the
tune of £5 million a year for six years. Given that 'Ma Bell' was
then an enormous, stable enterprise - and the long-term owner of Bell
Labs - it seemed a shrewd choice. Hopper couldn't have foreseen the
maelstrom that eventually caused AT&T to slash its research budget -
and axe its Cambridge lab.

In the IT research world, Hopper's ability to preserve his
researchers' autonomy in the corporate jungle attracted widespread
admiration.

'It is a very striking achievement by Andy to have kept the show on
the road as long as he did,' one of his peers said. 'None of the
owners/funders have been much good at exploiting the developments of
that lab, but Andy has done a number of successful spin-out
companies, which over the years have reduced the net cost to the
sponsor to a very low level. However, they don't generate the revenue
quarter on quarter that the bean-counters want to see.'

And that, of course, goes to the heart of it. To run a great research
lab, you have to be the antithesis of a bean counter. Your job is to
recruit the smartest people you can find, and then let them do their
stuff. Often these people have difficult, complex personalities - yet
you have to trust them. If you do, they will often repay that trust
by 'dealing lightning with both hands' -- to use Alan Kay's memorable
phrase about his colleagues at Xerox PARC.

In Hopper's lab there was a rule that anyone could buy anything on
his own authority so long as it cost less than £1,000. If you wanted
something more expensive, you had to get another signature, but that
was usually a breeze.

It was known colloquially as the 'toys budget' and it was, no doubt,
sometimes used for frivolous purchases. But in the main it was not.
And it meant that the lab's researchers always had the latest gizmos
- and the freedom to take them apart and see how they worked.

This kind of freedom is anathema to the bean-counters and lawyers of
this world. And it illustrates why the closure of the AT&T lab has a
wider significance. If society is to reap the full potential of
computing and information technology, we need hundreds of labs of
this calibre. Yet we are evolving a corporate ecology that is
increasingly hostile to the freewheeling ethos they need in order to
thrive.

Labs like Hopper's create the future. Without them, will we have one?

john.naughton () observer co uk
<http://www.briefhistory.com/footnotes/>




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