I’m just ploughing through Dave Burstein’s most excellent DSL Prime email newsletter, where he laments the demise of Lucent and Siemens, with their rich history.
What both of these illustrate is how changes in the relative scarcity of parts of the value chain cause industries to rise and fall.
In this case, we’ve gone in a decade or so from struggling to get dial-up to work to being peeved at how damn foreigners, dammit have got hundreds of megabits of fibre capacity to their homes and we’re lef with only megabits for minibucks. (No fibre on my street, though…)
So the scarcity shifted. Before the labour of maintaining trenches and ducts was fairly cheap compared to the megatech of switches and circuits. Now, we have a flip. Lasers are made for cents, glass fibre is almost cheap enough to use as loft insulation (OK, maybe not quite) and silicon packet switches are for whimps (and IMS vendors): real men switch and bounce photons directly.
So if Lucent wanted to stay alive and independent, they had to change their values and focus. Now the people are expensive and shifting bits is cheap. A robot that can climb inside a drain pipe, punch holes, poke out some fibre, seal it up so it doesn’t leak, then safely climb out the top is where it’s at. How can you affix antennae to buildings without them being blown off in the wind or damaging the surface? Why is it almost impossible to re-wire your house for data even when there’s a cavity behind every dry wall? 3M’s glue technology is as big a deal as any new quantum physics insights.
The biggest danger of R&D is you guide it with technologists, not economists.
Intel are facing the same crossroads. You can’t throw much more useful processing power at desktops, but boy is there demand for making batteries last longer. So you forget Moore’s law many orders of magnitude before you hit that R&D crisis, and switch over to making power management for ever smaller and more constrained devices your top priority. I don’t see them being bought out soon, because they’ve seen the need to switch railtracks and go to a different destination.
Posted by Martin Geddes at 10:53 PMTrackBack URL for this entry:
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