Entrepreneur Kurzweil Brought Sunshine to Stevie Wonder’s Life

(p. 265) On the snowy morning of January 13, 1976, . . . , there was unusual traffic on Rogers Street. Outside the gray one-story buildings with their clouded tilt-out windows, vans from various television channels maneuvered to park. A man from the National Federation of the Blind struggled over a snow bank onto the sidewalk and began tapping earnestly to get his bearings. A dark-haired young man set out on a three-block trek to the nearest vendor of coffee and donuts for the gathering media. In the room at number 68, two engineers poked at a gray box that looked like a mimeograph machine sprouting wires to a Digital Equipment Corporation computer. Several intense young men in their early twenties debated when to begin a demonstration of the device. The short, curly-haired leader of the group, twenty-seven-year-old Raymond Kurzweil, refused to start until the arrival of a reporter from The New York Times.

The event was a press conference announcing the first breakthrough product in the field of artificial intelligence: a reader for the blind. Described as an “omnifont character recognition device” linked to a synthetic voice, the machine could read nearly any kind of book or document laid face down on its glass lens. With a learning faculty that improved the device’s performance as it proceeded through blurred, faded, or otherwise illegible print, the machine solved problems of pattern recognition and synthesis that had long confounded IBM, Xerox, and the Japanese conglomerates, as well as thousands of university researchers.

. . .
(p. 266) Stevie Wonder, the great blind musician, called. He had heard about the device after its appearance on the “Today Show” and it seemed a lifelong dream come true. He headed up to Cambridge to meet with Kurzweil.

. . .
As Kurzweil remembers, “He was very excited about it and wanted (p. 267) one right away, so we actually turned the factory upside down and produced a unit that day. We showed him how to hook it up himself. He left with it practically under his arm. I understand he took it straight to his hotel room, set it up. and read all night.” As Wonder said, the technology has been “a brother and a friend . . . . without question, another sunshine of my life.” Wonder stayed in touch with Kurzweil over the years and would play a key role in conceiving and launching a second major Kurzweil product.

Source:

Gilder, George. Microcosm: The Quantum Revolution in Economics and Technology. Paperback ed. New York: Touchstone, 1990.
(Note: italics in original; all ellipses added except the ellipsis internal to the last paragraph, which was in the original.)

Another Boeing BHAG Takes Flight

BoeingDreamlinerFirstFlight2010-01-23.jpg “Members of the public watched the first test flight of the Boeing 787 on Tuesday in Everett, Wash.” Source of caption and photo: online version of the NYT article quoted and cited below.

In their stimulating business best-seller Built to Last Collins and Porrus have a chapter in which they argue that one way to attract and retain the best employees is to give them a difficult but important project to work on. They call such projects “BHAGs,” which stands for Big Hairy Audacious Goals. Among their main examples (e.g., p. 104) of BHAGs were Boeing’s development of the 707 and 747.
Boeing’s latest BHAG is the 787 Dreamliner.

(p. A25) EVERETT, Wash. — The new Boeing 787 Dreamliner lifted into the gray skies here for the first time on Tuesday morning, more than two years behind schedule and burdened with restoring Boeing’s pre-eminence in global commercial aviation.

“Engines, engines, engines, engines!” shouted April Seixeiro, 37, when the glossy twin-engine plane began warming up across from where spectators had informally gathered at Paine Field. Ms. Seixeiro was among scores of local residents and self-described “aviation geeks” who came to watch the first flight.
Moments after the plane took off at 10:27 a.m., Mrs. Seixeiro was wiping tears from her eyes. A friend, Katie Bailey, 34, cried, too.
“That was so beautiful,” Ms. Bailey said.

For the full story, see:
WILLIAM YARDLEY. “As 787 Takes Flight, Seattle Wonders About Boeing’s Future.” The New York Times (Weds., December 16, 2009): A25.
(Note: the online version of the article has the title “A Takeoff, and Hope, for Boeing Dreamliner” and is dated December 15, 2009.)

The reference for the Collins and Porras book is:
Collins, James C., and Jerry I. Porras. Built to Last: Successful Habits of Visionary Companies. New York: HarperBusiness, 1994.

Warming of Arctic Would Allow Faster, Safer Cable Route

NorthwestPassageFiberOpticCableRoute2010-01-23.jpg Source of map: online version of the Omaha World-Herald article quoted and cited below.

(p. 4A) ANCHORAGE, Alaska (AP) – Global warming has melted so much Arctic ice that a telecommunication group is moving forward with a project that was unthinkable just a few years ago: laying underwater fiber optic cable between Tokyo and London by way of the Northwest Passage.

The proposed system would nearly cut in half the time it takes to send messages from the United Kingdom to Asia, said Walt Ebell, CEO of Kodiak-Kenai Cable Co. The route is the shortest underwater path between Tokyo and London.
The quicker transmission time is important in the financial world where milliseconds can count in executing profitable trades and transactions. “Speed is the crux,” Ebell said. “You’re cutting the delay from 140 milliseconds to 88 milliseconds.”
. . .
“It will provide the domestic market an alternative route not only to Europe – there’s lots of cable across the Atlantic – but it will provide the East Coast with an alternative, faster route to Asia as well,” he said.
The cable would pass mostly through U.S., Canadian international waters and avoid possible trouble spots along the way.
“You’re not susceptible to ‘events,’ I should say, that you might run into with a cable that runs across Russia or the cables that run down around Asia and go up through the Suez Canal into the Mediterranean Sea. You’re getting away from those choke points.”

For the full story, see:
DAN JOLING, Associated Press Writer. “Loss of Arctic Ice Opens Up New Cable Route.” Omaha World-Herald (Fri., January 22, 2010): 4A.
(Note: the online version of the article had the title: Global warming opens up Arctic for undersea cable” and was dated January 21, 2010.)
(Note: ellipsis added.)

Establishments Assume New Methods Are Unsound Methods

(p. 188) For the next two years, Conway coordinated her efforts under Sutherland at PARC with Mead’s ongoing work at Caltech. But she was frustrated with the pace of progress. There was no shortage of innovative design ideas; computerized design tools had advanced dramatically since Mead’s first efforts several years before. Yet the industry as a whole continued in the old rut. As Conway put it later, the problem was “How can you take methods that are new, methods that are not in common use and therefore perhaps considered unsound methods, and turn them into sound methods?” [Conway’s italics].

She saw the challenge in the terms described in Thomas Kuhn’s popular book The Structure of Scientific Revolutions. it was the problem that took Boltzmann to his grave. It was the problem of innovation depicted by economist Joseph Schumpeter in his essays on entrepreneurship: new systems lay waste to the systems of the past. Creativity is a solution for the creator and the new ventures he launches. But it wreaks dissolution–“creative destruction,” in Schumpeter’s words– for the defenders of old methods. In fact, no matter how persuasive the advocates of change, it is very rare that an entrenched establishment will reform its ways. Establishments die or retire or fall in revolution; they only rarely transform themselves.

Source:

Gilder, George. Microcosm: The Quantum Revolution in Economics and Technology. Paperback ed. New York: Touchstone, 1990.
(Note: italics in original.)

Bose Leapfrogs the Competition in Defense of Your Peace and Quiet

BoseQuietComfort15.jpg“The Bose QuietComfort 15 has refined circuitry and redesigned earcaps.” Source of caption: print version of the NYT article quoted and cited below. Source of photo: online version of the NYT article quoted and cited below.

(p. B8) . . . , if your sales are getting eaten alive by cheaper rivals, and you don’t want to play the price game, you have only one option: play leapfrog. Make your gadget so much better than the me-toos that people will be willing to pay your premium once again.

That’s the idea behind Bose’s new QuietComfort 15 model ($300), which replaces the QuietComfort 2.
. . .
First, the QC15 model really, truly does advance the art of noise cancellation — big time. The QC 2 headphones and my Panasonics cut the airplane roar by half. But the 15 reduced it by, say, 85 percent, leaving only a distant, whispery whoosh to remind you that you’re in an aluminum tube 39,000 feet up in the air. Taking them off after a while, as you’ll want to do because your ears get sweaty, is like walking into a rock concert when you’ve been outside the building.

For the full story, see:
DAVID POGUE. “State of the Art; Ho Ho Ho? You Won’t Hear a Thing.” The New York Times (Thurs., December 3, 2009): B1 & B8.
(Note: the online version of the article is “State of the Art; Bose’s Latest Headphones Can Quell the Clangor” and is dated December 2, 2009.)
(Note: ellipses added.)

Replication Easier than “Sweat and Anguish” of First Discovery

(p. 137) No one will deny that Japan’s triumph in semiconductors depended on American inventions. But many analysts rush on to a further theory that the Japanese remained far behind the United States until the mid- 1970s and caught up only through a massive government program of industrial targeting of American inventions by MITI.
Perhaps the leading expert on the subject is Makoto Kikuchi, a twenty-six-year veteran of MITI laboratories, now director of the Sony Research Center. The creator of the first transistor made in Japan, he readily acknowledges the key role of American successes in fueling the advances in his own country: “Replicating someone else’s experiment, no matter how much painful effort it might take, is nothing compared with the sweat and anguish of the men who first made the discovery.”

Kikuchi explains: “No matter how many failures I had, I knew that somewhere in the world people had already succeeded in making a transistor. The first discoverers . . . had to continue their work, their long succession of failures, face-to-face with the despairing possibility that in the end they might never succeed. . . . As I fought my own battle with the transistor, I felt this lesson in my very bones.” Working at MITI’s labs, Kikuchi was deeply grateful for the technological targets offered by American inventors.

Source:

Gilder, George. Microcosm: The Quantum Revolution in Economics and Technology. Paperback ed. New York: Touchstone, 1990.
(Note: ellipses in original.)

Entrepreneurial Innovation Comes from Diverse Outsiders Rather than Establishments

(p. 113) Firms that win by the curve of mind often abandon it when they establish themselves in the world of matter. They fight to preserve the value of their material investments in plant and equipment that embody the ideas and experience of their early years of success. They begin to exalt expertise and old knowledge, rights and reputation, over the constant learning and experience of innovative capitalism. They get fat.

A fat cat drifting off the curve, however, is a sitting duck for new nations and companies getting on it. The curve of mind thus tends to favor outsiders over establishments of all kinds. At the capitalist ball, the blood is seldom blue or the money rarely seasoned. Microcosmic technologies are no exception. Capitalism’s most lavish display, the microcosm, is no respecter of persons.
The United States did not enter the microcosm through the portals of the Ivy League, with Brooks Brothers suits, gentleman Cs, and warbling society wives. Few people who think they are in already can summon the energies to break in. From immigrants and outcasts, street toughs and science wonks, nerds and boffins, the bearded and the beer-bellied, the tacky and uptight, and sometimes weird, the born again and born yesterday, with Adam’s apples bobbing, psyches (p. 114) throbbing, and acne galore, the fraternity of the pizza breakfast, the Ferrari dream, the silicon truth, the midnight modem, and the seventy-hour week, from dirt farms and redneck shanties, trailer parks and Levittowns, in a rainbow parade of all colors and wavelengths, of the hyperneat and the sty high, the crewcut and khaki, the pony-tailed and punk, accented from Britain and Madras, from Israel and Malaya, from Paris and Parris Island, from Iowa and Havana, from Brooklyn and Boise and Belgrade and Vienna and Vietnam, from the coarse fanaticism and desperation, ambition and hunger, genius and sweat of the outsider, the downtrodden, the banished, and the bullied come most of the progress in the world and in Silicon Valley.

Source:

Gilder, George. Microcosm: The Quantum Revolution in Economics and Technology. Paperback ed. New York: Touchstone, 1990.

After Lab Accident, Chip Innovator Shima Was Resilient

The incident recounted below is from the story of the development of the 4004 microprocessor (which was the first commercially available microprocessor). Hoff and Shima played important roles in the development of the chip.
I am not sure that the main “lesson” from the incident is about the importance of details. (After all, many entrepreneurs, including Simplot, embark on big projects without a clear idea of how to accomplish the details.) A bigger and sounder lesson may be the usefulness of resilience for successful inventors and entrepreneurs.

(p. 104) Hoff’s counterpart at Busicom was a young Japanese named Masatoshi Shima who also had been thinking about problems of computer architecture. An equally formidable intellect, Shima came to the project through a series of accidents, beginning with a misbegotten effort to launch a small rocket using gunpowder he made by hand in his high school chemistry laboratory. As he carefully followed the formula, he claims to have had the mixture exactly right, except for some details that he overlooked. The mixture exploded, and as he pulled away his right hand, it seemed a bloody stump. At the local hospital (p. 105) a doctor with wide experience treating combat wounds felt lucky to save the boy’s thumb alone,

This ordeal taught the teen-aged Shima that “details are very important.” In the future he should “pay attention to all the details.” But the loss of his fingers convinced his parents–and later several key Japanese companies–that the boy should not become a chemical engineer, even though he had won his degree in chemical engineering. Thus Shima ended up at Busicom chiefly because it was run by a friend of one of his professors.

Source:

Gilder, George. Microcosm: The Quantum Revolution in Economics and Technology. Paperback ed. New York: Touchstone, 1990.

Packard Was Told, If He Wanted a Better Car “He Had Better Build It Himself”

PackardPanther1954SteeringWheel.JPGThe steering wheel of the 1954 Packard Panther. Source of photo: online version of the NYT article quoted and cited below.

(p. 11) The company may have started on a dare, according to “Packard: A History of the Motor Car and the Company,” edited by Beverly Rae Kimes (Automobile Quarterly Publications, 2002).

After graduating from Lehigh University’s engineering school and returning home to Warren, Ohio, James Ward Packard considered buying his first car, a Winton. When Packard asked for some special features, he got this response from Alexander Winton: “The Winton waggon (sic) as it stands is the ripened and perfected product of many years of lofty thought … and could not be improved in any detail. If Mr. Packard wants any of his own cats and dogs worked into a waggon, he had better build it himself.”
Despite the rude reply, Packard bought the car, but it broke down often. Commiserating over dinner with George Weiss, a friend (and Winton stockholder), Packard decided to take Winton’s words seriously. It must have been an especially satisfying day for Packard on June 17, 1899, when Weiss sold his Winton stock and invested in Packard’s new business, soon to be named the Ohio Automobile Company.
Although its first cars looked conventional, they had some unusual features. It was one of a few cars with an accelerator pedal, and its H-gate gearshift pattern, a Packard patent, was widely used in later years.
Packard’s reputation for reliability and durability was established with its model A and B cars, but the company did not stop development there, even taking the lessons of early mishaps to improve subsequent vehicles.
During the summer of 1900, a model B swerved into a ditch after hitting a pothole — a hazard on cars with tiller steering, as the impact could jerk the steering lever from the driver’s grasp — injuring the passenger and damaging the car. Packard started work on a solution; when the model C was introduced later that year, it featured the industry’s first steering wheel.
. . .
After flirting with Nash in the early 1950s, Packard purchased Studebaker in 1954 (which explains why the Packard Predictor resides in the Studebaker Museum). Studebaker was larger but struggling. The merger hastened the end of both makes.
Still, Packard left its mark on the American auto industry.

For the full story, see:
ROBB MANDELBAUM. “Collecting; Packard’s Visions of the Future, When It Still Had One .” The New York Times, SportsSunday Section (Sun., September 10, 2009): 11.
(Note: ellipsis added.)

Gilder’s Microcosm Tells the Story of the Entrepreneurs Who Made Personal Computers Possible

MicrocosmBK.jpg

Source of book image: http://images.indiebound.com/923/705/9780671705923.jpg

Many years ago Telecosm was the first George Gilder book that I read; I enjoyed it for its over-the-top verbal exuberance in detailing, praising and predicting the progress of the then-new broadband technologies. I bought his earlier Microcosm at about the same time, but didn’t get around to reading it because I assumed it would be a dated read, dealing in a similar manner with the earlier personal computer (PC) technology.
In the last year or so I have read Gilder’s Wealth and Poverty and Recapturing the Spirit of Enterprise. There is some interesting material in Gilder’s famous Wealth and Poverty, which has sometimes been described as one of the main intellectual manifestos of the Reagan administration. But Recapturing the Spirit of Enterprise has become my favorite Gilder book (so far).
In each chapter, the main modus operandi of that book is to present a case study of a recent entrepreneur, with plenty of interpretation of the lessons to be learned about why entrepreneurship is important to the economy, what sort of personal characteristics are common in entrepreneurs, and what government policies encourage or discourage entrepreneurs.
In that book I read that the original plan had been to include several chapters on the entrepreneurs who had built the personal computer revolution. But the original manuscript grew to unwieldy size, and so the personal computer chapters became the basis of the book Microcosm.
So Microcosm moved to the top of my “to-read” list, and turned out to be a much less-dated book than I had expected.
Microcosm does for the personal computer entrepreneurs what Recapturing the Spirit of Enterprise did for a broader set of entrepreneurs.
In the next few weeks, I will occasionally quote a few especially important examples or thought-provoking observations from Microcosm.

Reference to Gilder’s MIcrocosm:
Gilder, George. Microcosm: The Quantum Revolution in Economics and Technology. Paperback ed. New York: Touchstone, 1990.

Other Gilder books mentioned:
Gilder, George. Recapturing the Spirit of Enterprise: Updated for the 1990s. updated ed. New York: ICS Press, 1992. (The first edition was called simply The Spirit of Enterprise, and appeared in 1984.)
Gilder, George. Telecosm: The World after Bandwidth Abundance. Paperback ed. New York: Touchstone, 2002.
Gilder, George. Wealth and Poverty. 3rd ed. New York: ICS Press, 1993.

Musings in Defense of the Car


Studebakers were made mainly in South Bend, Indiana, where I was born and raised. (One of our early family cars was a Studebaker Scotsman, but, alas, it did not look much like the Studebaker Commander that was once pictured above.)
By the way, in the musings quoted below, my understanding is that O’Rourke is not entirely right about Henry Ford: I believe Ford bankrupted two auto companies before founding the one that made the Model T that was once pictured below.)

(p. W2) . . . cars didn’t shape our existence; cars let us escape with our lives. We’re way the heck out here in Valley Bottom Heights and Trout Antler Estates because we were at war with the cities. We fought rotten public schools, idiot municipal bureaucracies, corrupt political machines, rampant criminality and the pointy-headed busybodies. Cars gave us our dragoons and hussars, lent us speed and mobility, let us scout the terrain and probe the enemy’s lines. And thanks to our cars, when we lost the cities we weren’t forced to surrender, we were able to retreat.
. . .
I don’t believe the pointy-heads give a damn about climate change or gas mileage, much less about whether I survive a head-on with one of their tax-sucking mass-transit projects. All they want to is to make me hate my car.
. . .
American cars have been manufactured mostly by romantic fools. David Buick, Ransom E. Olds, Louis Chevrolet, Robert and Louis Hupp of the Hupmobile, the Dodge brothers, the Studebaker brothers, the Packard brothers, the Duesenberg brothers, Charles W. Nash, E. L. Cord, John North Willys, Preston Tucker and William H. Murphy, whose Cadillac cars were designed by the young Henry Ford, all went broke making cars. The man who founded General Motors in 1908, William Crapo (really) Durant, went broke twice. Henry Ford, of course, did not go broke, nor was he a romantic, but judging by his opinions he certainly was a fool.
. . .
There are those of us who have had the good fortune to meet with strength and beauty, with majestic force in which we were willing to trust our lives.

For the full commentary, see:

P.J. O’ROURKE. “The End of the Affair. The fate of Detroit isn’t a matter of economics. It’s a tragic romance, whose magic was killed by bureaucrats, bad taste and busybodies. P.J. O’Rourke on why Americans fell out of love with the automobile.” The Wall Street Journal (Sat., MAY 30, 2009): W1-W2.

(Note: ellipses added.)
(Note: thanks to my mother for refreshing my faulty memory on which model of Studebaker we owned.)

For some interesting brief background on Ford, see:
Nye, John Vincent. “Lucky Fools and Cautious Businessmen: On Entrepreneurship and the Measurement of Entrepreneurial Failure.” In The Vital One: Essays in Honour of Jonathan R. T. Hughes, edited by Joel Mokyr. Greenwich, Conn. and London: JAI Press, 1991, pp.131-52.