Dr. JEWETT. That's right.

Dr. JEWETT. You are quite right. Let me finish this and then I will tell you an illustration exactly along the lines I think your mind is running. It shows how the thing worked in another situation contrariwise. Their objective was this thing I have indicated to you and that they should provide this service on demand at the lowest possible rate, and by lowest possible rate they meant in every case rates which were low enough so that they imposed no substantial artificial barrier to a free usage of this service, and with safety to the business. Now that has been the objective ever since before I was in the telephone business. It was stated by Gifford down at Dallas many years ago, and it wasn't anything new with Gifford; he was just restating a thing which was old before he and I were born, almost.

Now to give you the illustration of how the thing works contrariwise. One of the things which was done here a good many years ago in the growth of the business was to develop certain kinds of machine switching to take the place of manual switching which had become in the big cities a very difficult thing to do, and because of this centralized, unified thing in the Bell system, and because of this long-range proposition where you finally judge whether a thing is good, bad, or indifferent by the total cost of the time until you put it on the junk heap, certain types of apparatus were developed for the big city areas like New York. The British Post Office came along and they had a similar problem in London. London, a great big city, didn't have as big a telephone development as New York, but it was a big problem and they envisioned what has actually taken place, a big growth in the telephone service in London. They knew of all this work we had done over here, there was no secret about it, and they wanted very much to use that, the engineers in the British post office wanted to use it, but that type of apparatus required extremely expensive tools to stamp out the stuff, so expensive that it only proved out over the less efficient types of things if you could manufacture in large quantities, single manufacture such as we had in the Bell system. They didn't have that in England; they weren't masters of their own house; their business was built to a considerable extent on what they could get from the manufacturers. That isn't saying that the manufacturers didn't try to do what they wanted but there was a division of responsibility there. They were set up on a competitive basis so far as their manufactures were concerned, and it was quite obvious that two or three or four manufacturers could not tool up with these expensive tools to make this limited quantity of stuff and have the post office bear the burden as they would have to bear it, of these duplicate sets of tools. The post office even went so far at that time (the Postmaster General did) as to work out and present to Parliament a scheme which was, in effect, that these several manufacturing companies should realine their business so that one of these companies could be the sole producer of this thing which they wanted to use, and in return for that give up other kinds of things which it had been manufacturing, and Parliament in its wisdom, probably it was all right, refused to do that. The result was that the British Post Office had to put in, in the city of London, a system which they knew was inferior to the one which was available and was in use generally in the United States.

124491-39-pt. 3- -9

The CHAIRMAN. Well, the sum total is that in the minds of those who have directed and planned the growth of the Bell telephone system, the patenting of devices and manufacturing of devices which are invented and patented is a wholly subordinate thing to the larger concept of the work of the system.

Dr. JEWETT. Absolutely.

The CHAIRMAN. That is to say that the manufacturing of these devices for the return to be derived from them is not the main objective.

PATENTS RESPONSIBLE FOR DEVELOPMENT OF TELEPHONE

Dr. JEWETT. Absolutely not. And as long as you have mentioned patents now, Senator, I will go back and say that the Bell system is somewhat unique in another respect in connection with patenting. It is a type example of rather ancient age now. When was the telephone invented, '76? It is sixty-odd years ago. In its early stages it was completely dependent on patents, that was its lifeblood; it could not have come into being except for the protection which the patent laws of the United States gave. It was a toy; it was looked upon as a toy when it was invented. Some people had some vision and some courage. They were living in an era in which they were not afraid, and they had reason to believe that the patent system as it existed at that time was a stable thing, that it would persist for a number of years, and they risked their money on this thing. I doubt, with that some thing coming into the picture just at this moment, whether the same course could be pursued, but that is because there are a lot of other factors mixed up in it.

As time went on their complete dependence on patents existed for a good time, 10, 15, or 20 years, as is evidenced. Of course I have to get it from the lore of the tribe, I wasn't old enough to know about it, but it is perfectly clear from the record how vital was this patent business to this small industry which has now become vast. It grew from a little bit of a thing. All you have to do is to look at the records of suits and the scraps in the Patent Office to know how vital it was at that time. But as time went on and the business grew bigger, the same thing happened to us that happens to every great industry. While patents are still of very great importance to us, particularly important in stimulating the ideas which come to us from the outside relatively, they become less vital to the business than they were at the start, and in the case of an industry like ours which for quite natural reasons is not subject to competition in the ordinary sense, our interest in patents is largely an interest of freedom to use whatever is best in the business. The result of it is that I think I am safe in saying that not one-hundredth of 1 percent of the research and development work in the Bell Telephone Laboratories, vast as they are, is done with the idea of getting patents. Patents are a pure incident in the business. Our job up there is to solve problems, is to find new and better, more satisfactory ways of doing the kinds of things we are now doing, or doing other kinds of things.

The CHAIRMAN. If you were to adopt a phrase that is in more or less common use when economic systems are discussed would it be proper for me to say that within the Bell telephone system the theory is: patenting and production for use rather than for profit?

Dr. JEWETT. Yes, I think that is quite right.

Mr. PATTERSON. May I go back, Dr. Jewett

Dr. JEWETT (interposing). Let me add one thing. The thing is so much of an incidence, the patenting business is taken in its stride, that it is a form of publication, it is a form of publication that has to be done under the laws of the land under certain conditions if you are going to carry out the intent of the patent laws, but the darned thing works in our place in such a way that a large part of the research people resent having to spend time in getting the patents. In the first place, they don't want to spend the time on it, and in the second place they don't want to present their work in the stereotyped way that the patent specifications call for.

Mr. PATTERSON. Dr. Jewett, did you give the year the long-life tube came out? If you did, I didn't get it.

Dr. JEWETT. My recollection is that that change was made in 1923, and we are still 15 years afterwards deriving the benefit from it. Of course, I don't want to get into astronomical figures of the kind you got into yesterday, you can build a thing up so that it becomes absurd, but that is an annual saving. In the year 1938, just as I said, if you replace the tubes that are in the sockets of the Bell system in connection with this long-line service in the tubes of the vintage of whatever this was, 1923, there would be no change in the service, the subscriber wouldn't know it, but it would cost $10,000,000 to do it.

Mr. PATTERSON. I follow that clearly. I have two or three things in my mind. Is it not this tube that your contemporary, Dr. John Carty, gave so much time to, your vice president in charge of engineering?

Dr. JEWETT. This is the vacuum tube, yes.

Mr. PATTERSON. You recall General Carty?

Dr. JEWETT. Oh, absolutely; I was his assistant for many years. Mr. PATTERSON. Could I use this tube in my radio?

Dr. JEWETT. No.

Mr. PATTERSON. Could I buy it today?

Dr. JEWETT. Not the one I use.

Mr. PATTERSON. The long-life tube?

Dr. JEWETT. I couldn't use it in my radio and I couldn't use it in any radio because it is designed for the particular service of the telephone repeaters, but you could make a tube which you could use in your radio which has the properties of this thing.

Mr. PATTERSON. I could?

Dr. JEWETT. Sure.

Mr. PATTERSON. Is there one on the market?

Dr. JEWETT. Not that I know of.

The CHAIRMAN. Are the qualities which make this new tube patented?

Dr. JEWETT. Sure, and there are plenty of people licensed to make it if they want to make it.

The CHAIRMAN. I think probably I didn't make myself clear. Was the method by which you produced the longer-lived tube requiring less power to operate just a method of manufacturing or was it a particular

Dr. JEWETT (interposing). No, of course, I haven't looked the thing up and I can't tell you just what happened, but I surmise you would find that there probably were a considerable number of what you might call secondary patents connected with the development

which I have described here. Fundamentally the tube is exactly what was covered by the earlier De Forrest patents; it is a three-member device.

Mr. PATTERSON. Are any other companies making this tube?

Dr. JEWETT. I think the only companies that are making this type of tube-I don't know any in this country that are doing it. I think the International Telephone & Telegraph Co., which operates abroad, and which has rights under our patents, is making this type of tube for service abroad.

Mr. PATTERSON. So far as you know, no other company in this country is making it?

Dr. JEWETT. No, I don't think so. Of course, I am not a tube expert, but I don't know of any tubes on the market which have the coated type of filament which is employed in all our telephone tubes. Most of them are tungsten filament tubes.

Mr. PATTERSON. If I had the proper experience and the financial structure to manufacture these tubes, would you give me a license to manufacture them?

Dr. JEWETT. I think so. I am not in charge of the licensing business of the company, but I know that many licenses have been given. Whether those licenses that have been given are in any way so worded that they couldn't extend to your particular case, I don't know. You would have to inquire, but so far as I know, yes.

Mr. PATTERSON. Do you happen to know, Dr. Jewett, the general policy of Mr. Gifford on that particular point, as to licensing? Dr. JEWETT. No; I don't.

Mr. PATTERSON. I don't want to press that question.

Dr. JEWETT. To tell the honest truth, I don't think that we have what you would call a fixed policy on the thing, except that our business is the telephone business and our actions in the past have indicated our willingness to grant licenses broadly, and we have granted many of them. I don't see them; you would have to get that from someone else.

Mr. PATTERSON. Don't misunderstand my question; the A. T. & T. like Tiffany to silver, is doing a marvelous job, but the Patent Office is very anxious to get your advice and assistance in a lot of these things and you in particular with two or three other men can be of great service to us. But have you found any trouble in your dealings with the Patent Office? Have things been fairly smooth? Have we delayed you?

Dr. JEWETT. As far as I know, they have been fine, but my business isn't to solicit patents which bring me into contact with the detailed operations of the Patent Office. But I have never heard any complaint of the thing at all and I think that the Patent Office's attitude toward getting their work done promptly and well conforms exactly to what we want to have done. We are as anxious as anybody to get our applications through in the shortest possible time and in the best possible fashion. The thing I deprecate more than anything else as a user of the system is the thing exemplified in the first recommendation of the Patent Committee, of which I was a member, and that is the invalid patent. If I could have my way I would have nothing but valid patents coming out and I would have a good time.

The CHAIRMAN. You are a fundamental scientist, as I understand it. Dr. JEWETT. Well, I was a practitioner in the field of the fundamental sciences. Now I don't know what I am.

The CHAIRMAN. Your laboratory is somewhat similar to that which was described by Dr. Coolidge yesterday. You conduct your investigations into matters of principle; that is to say into matters of fundamental science, as well as into matters affecting the practical problems which are presented from time to time.

Dr. JEWETT. Yes.

The CHAIRMAN. In other words, your laboratory is not under narrow restrictions from the managers of Bell Telephone to confine its efforts. to productive devices alone.

Dr. JEWETT. No; absolutely not, Senator. I am one of the managers. of the Bell system. I am one of its officers. I participated in that thing, and it is true, I think, that the field of our interest is narrower than the field of the interest of the General Electric Co., because we are primarily concerned with the communications field. That is one application of electricity. The sky is the limit for them in their interests.

The CHAIRMAN. But in the prosecution of your studies would it be proper for me to infer that it is almost inevitable that you should follow along in much the same channel as that which is pursued by General Electric, and that you both might be developing similar ideas, mostly in competition with one another?

Dr. JEWETT. Frequently we do, insofar as their interest happens to be in our sector. They are more likely to be doing things in our sector than we are in theirs, because their sector has a great big section we are not interested in.

The CHAIRMAN. And that does happen?

Dr. JEWETT. Absolutely, and does with every other laboratory. In fact, a thing as far removed as synthetic organic compounds, which is the business of an outfit like the Du Pont Co. and not primarily an interest of a thing like the Bell Laboratories, we find in conflict there occasionally.

The CHAIRMAN. It was developed yesterday from Dr. Coolidge that discoveries and inventions are made in the General Electric Laboratory which are altogether outside the field in which General Electric was organized to operate. Now that is true of your laboratory too, is it not?

Dr. JEWETT. I think so. I think it is true of every laboratory.

The CHAIRMAN. What happens to the inventions and discoveries of that character which are outside the field of communication? What do you do with those?

Dr. JEWETT. In general, I should say, and here again you would have to go to the people who are actually operating this kind of property, they are licensed to people who are in those fields.

The CHAIRMAN. But you are one of the managers of the company. Dr. JEWETT. That would be the policy, to make those things available in some way. Take a case that I happen to think of offhand, that I know quite a little bit about, submarine signaling, this protection of ships at sea and that sort of stuff. That is a kind of business that the General Electric or the Western Electric might well be in. It is. Take the Western Electric. It is not very far removed from the kind of stuff that they make for the telephone business, but it is a specialty kind of business. We are not in it. It is a kind of business which is 1 Supra p. 911 et seq.