TELECOM Digest OnLine - Sorted: Re: AT&T Inventions Fueled Tech Boom, And Its Own Fall

Re: AT&T Inventions Fueled Tech Boom, And Its Own Fall

Lisa Minter (
8 Feb 2005 11:05:15 -0800 wrote:

> Some critics blame the mgmt of AT&T and IBM for allowing the companies
> to be top-heavy. I don't agree. At the time the people were hired,
> there was a need for their skills. At the time they were hired, they
> still had a to support a network antiquated by today's standards.

I forgot one other important point.

Throughout the postwar history of both AT&T and IBM new technology was
more efficient and reduced the number of workers needed. Yet the
companies _added_ workers. Why was that?

A reason was the new technology lowered the cost of service and thus
increased business level. As AT&T automated long distance and reduced
its cost, customers made more calls and the net need for telephone
operators actually went up. There were fewer operators per call, but
so many more calls. Likewise for IBM*. New technology reduced the
number of employees needed to service computers, but the lower cost
enabled more people to get computers, thus producing a net gain in

For both companies, technology (and business world) changes exploded
the business yet employees were no longer needed to support even
tremendous high volume of business. When was the last time we needed
a human telephone operator? When was the last time an IBM service
technician came out to fix a broken card, printer, or install new
software? Those things are automated or eliminated.

*How many employees did IBM need just to test and replace vacuum tubes
in its mainframe computers of the 1950s -- which continued in service
well into the 1960s?

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