who doesn't make tubes today from going into that business and producing a 20,000-hour tube? There must be some reason why they don't do it. Do you know the reason? Is it that they can't get patents? Dr. JEWETT. I will tell you what I think is a very practical reason, even though people have the full right to do this thing and facilities for doing it. In the first place, I think it probably is true that the best interests of the radio industry and the users of that, the radio set people, are served where you have uniformity, a certain amount of standardization, so you could use different manufacturers' tubes in different sets. There is a fundamental difference in the manufacturing concept of most of the people who are in the tube-manufacturing business, the big R. C. A., General Electric people, and the Westinghouse Co.

I have tried to outline that in the Bell System the emphasis has been on quality of stuff as it is reflected in service. That has inevitably forced us in the laboratories in the Western Electric Co. into a technique which is based on quality of performance without vast quantities, usually, for many things. Now the electric-light business, from which most of this vacuum-tube business has sprung, has been an art which developed from the standpoint largely of the lowest possible cost of the thing which you supply, I mean the cost of electric light bulbs has come down, and the technique which they developed and which they carried over into the vacuum-tube game is quite a different technique from that which we in the Western Electric employ, and they would have to learn a new technique, or somebody would have to learn this same technique in order to do this long-life coated filament type of thing. My experience has always been, in every line, that an organization which has lived long under one kind of technique finds it extremely difficult to pick up an entirely different technique, and there may be some of that in the explanation.

Dr. LUBIN. The thing that I just can't quite understand is that here are people in the United States foregoing an opportunity to make millions, to make something which is 20 times as good as anything on the market, and you wouldn't have to charge much more for it.

Could Western

Dr. JEWETT. I am not so sure that they are doing that. The CHAIRMAN. How about Western Electric? Electric manufacture these long-life tubes for radios?

Dr. JEWETT. Yes; it could, but I am not sure under their licensing arrangements whether they are fully free to go into that kind of business.

The CHAIRMAN. In other words, the cross-licensing agreement which the Bell has with R. C. A. and the others might prevent you from utilizing this very advantageous discovery which you made in the radio field.

Dr. JEWETT. In a particular field.

The CHAIRMAN. Do you know whether or not you could license that tube, say, to the Zenith, which I think is independent?

Dr. JEWETT. I don't know that, Senator.

The CHAIRMAN. You don't have a cross-licensing agreement with Zenith?

Dr. JEWETT. I don't know.

Mr. PATTERSON. Let me ask this question, Dr. Jewett, to follow up the chairman and Dr. Lubin. Is it your judgment that if the

Bell long-life tube patent were used in the manufacture of radio tubes, that it would provide, say, many times the life, use only a portion of the current, and reduce production costs, if the radio people used that tube?

Dr. JEWETT. I am not sure that the tube would be as cheap as the present short-life tube that you buy. My comparison of costs on the tubes themselves was between two tubes of the same breed. I suspect I don't know what these prices are that the tubes that are now supplied in radio sets are cheaper than this tube that I am talking about.'

The CHAIRMAN. Well, Western Electric manufactures the larynx box for hospitals.

Dr. JEWETT. Yes.

The CHAIRMAN. It manufactures this deaf cell, and it manufactures other byproducts which are altogether independent of the communication field. Radio, of course, is within the communication field, so that the question presents itself consistently: How does it come that Western Electric doesn't develop and manufacture in the radio field a perfectly marvelous discovery which it has made?

Dr. JEWETT. It does in that part of the radio business which they are in, which is the furnishing of radio stuff for communication purposes, but I think, if you want to pursue this further, you ought to get somebody from the Bell Co. who is concerned with this phase of the thing, but whatever the situation is at the present time as the result of the cross licenses which exist in this field of radio, which is largely in the broadcasting, they are tied up with a situation which goes back to patents of 20 years ago, a situation following the advent of the De Forrest three-member device into the field through the Telephone Co. I have forgotten when De Forrest made that invention, which, of course, was subordinate to an earlier invention by Fleming in England; my recollection is about 1906 it was invented as a wireless detector, and it served its purpose. Actually De Forrest I don't think, or anybody, knew exactly, what the mechanism was that he had there. But it had all these properties which have since become so valuable, but people didn't recognize it. It was in 1912, when we were struggling hard to complete a promise to have a transcontinental telephone line in San Francisco in time for the opening of the Panama Pacific Exposition and we were trying to find every conceivable amplifying device that we could think of that would work, that this thing, 6 years after its invention or 6 years after its patenting, was brought to our attention as a possible telephone amplifier, but it didn't work. But what did happen was that it was obvious to the scientific people that the thing could be made to work. They saw what the trouble was and they went ahead and did it. Well, we didn't think this thing was patentable. All I am leading up to, Senator, is that the impasse which arose out of a bunch of conflicting patents brought about the initial cross licensing thing which in modified form over the years is what controls the situation today.

The CHAIRMAN. Yes; I perceive that, and I feel it is probably outside of your line, but would you object if, on behalf of the committee, I asked you to make inquiry of the proper person in the Bell system

1 Dr. Jewett subsequently gave the committee other facts showing that the long-life vacuum tubes would not be in economic balance with radio receiving sets whose average life is perhaps one-fifth to one-tenth that of these tubes. See "Exhibit No. 244" entered in the record on February 8, 1939, and included in the sppendix on p. 1158.

or the Western Electric system, and notify the committee whether or not this cross-licensing arrangement prevents you from manufacturing this tube for the radio field?1

Dr. JEWETT. Prevents us, prevents the Western Electric, from manufacturing for the general field?

The CHAIRMAN. The general radio field.

RELATIONSHIP BETWEEN ISSUANCE OF VALID PATENTS AND PROPOSED SINGLE COURT OF PATENT APPEALS

Mr. COE. Mr. Chairman, I want to pursue a thought that was expressed by Dr. Jewett some moments ago. He said that he would be very happy if no patents other than valid patents were issued.

Dr. Jewett, you were a member of the Science Advisory Board which recommended, among other things, that there be established a single court of patent appeals. Dr. Bush, on his appearance before this committee yesterday, made this statement."

The unfortunate situation that obtains today is that an individual who is granted a patent by the United States Government has no great assurance, as he ought to have, that that patent is valid and will be sustained. Anything that can be done to increase the presumption of validity of that patent when it is issued will aid in the introduction of new ideas in industry, because it will shorten and make easy the path of the man who has to forge the way.

Do you see any connection between the establishment of a single court of patent appeals and the percentage of valid patents issued by the Patent Office?

Dr. JEWETT. Most assuredly. I think it has a very direct relationship. It has been a number of years since I read that report of ours, I don't know whether that is mentioned or not, but if my understanding is correct, one of the first and most direct effects that would come out of the effect of the establishment of a single court of last instance would be the setting of more permanent standards than we have now for the guidance of the Patent Office in what does constitute a valid patent, and I should assume that unquestionably the establishment of such a single court would tend not directly, but indirectly, to increase the presumption of validity of the work that comes out of your office, because you are not going to be battered around from pillar to post with conflicting views as to what constitutes validity in different circuits. You have got some final court that tells you at least what the judgment of the court is as to its validity.

Mr. COE. In other words, in addition to the tendency to reduce the cost and duration of litigation, it will have the effect of increasing the percentage of valid patents, in your judgment?

Dr. JEWETT. Yes; I am not a lawyer and I am not a patent man, but I should assume that if this court is established along the lines that we of the committee had in mind, and of course we didn't attempt to say who would be on it, we assumed they would be competent people, competent men, men of training, and that they would serve for long periods of time, like other Federal judges do, they would inevitably build up certain standards, just as the Supreme Court has built up certain standards, that would become a background of substantial proven law, which certainly should make it easier for an

In this connection see letter from Dr. Jewett to Senator O'Mahoney, under date of January 24, 1939, which was entered in the record as "Exhibit No. 244" at hearings held February 8, 1939, and is included in the appendix on p. 1158.

Supra, p. 893.

examiner, looking at somebody's applications, to say whether the claims that are asked to be allowed fit in with the pattern which the courts have said constitutes validity.

Mr. COE. Thank you very much.

Dr. JEWETT. Does that answer your question?

Mr. COE. Yes; fully.

Mr. DAVIS. Mr. Chairman, if I may: Dr. Jewett, you spoke of your system getting out of the radio field, as I understood it. It is a fact, is it not, that your system has a very close relation to radio in the transmission of radio programs over your wires?

Dr. JEWETT. Absolutely.

Mr. DAVIS. You have a monopoly of that field, haven't you?

Dr. JEWETT. Substantially; yes. I think there probably are certain cases where the wires of the Western Union or Postal are used, but in the main you are correct. It is a monopoly because it is only telephone wires that can be used for this purpose.

Mr. DAVIS. Why can't telegraph wires be used?

Dr. JEWETT. For this simple reason, Judge: The Lord, in His wisdom, fixed it up so that whenever you create a telephone ciruit, almost without exception you automatically create one or more telegraph circuits, but when you create a telegraph circuit, which is for the transmission of a very much less rigid kind of transmission, you don't automatically create a telephone circuit, and while it is true that there are some telegraph circuits of more recent origin that are capable of handling telephone transmission with some degree of adequacy, the great bulk of all telegraph circuits are not capable of handling telephony adequately, without complete revamping.

Mr. DAVIS. Well, if that is true why was it necessary for the A. T. & T. and the National Broadcasting Co. to enter into an agreement to the effect that the N. B. C. would only use A. T. & T. wires? Dr. JEWETT. I don't know. Do they do that?

Mr. DAVIS. I think that is a matter of record; yes.

Dr. JEWETT. Maybe so. I don't know.

Mr. DAVIS. Do you know whether your company still requires a license from a broadcasting company now, in the United States?

Dr. JEWETT. From a broadcasting company? I don't know. I don't think so. I don't know just what you refer to.

Mr. DAVIS. I refer to the fact that it certainly formerly did. Dr. JEWETT. Are you referring to the case of where apparatus which infringed patents was made by various people?

Mr. DAVIS. I refer to the claim of the American Telephone & Telegraph Co. that was made that no broadcasting apparatus was in existence that did not infringe on their patents, and consequently if the licensee from the United States Government to conduct a broadcasting station desired to operate, he would have to obtain a license from you.

Dr. JEWETT. I think I know what you are referring to. Of course, we furnished broadcasting stations; a lot of broadcasting stations are manufactured by the Western Electric. They automatically carry a license under patents. The stations of the people affected by the cross-licensing arrangement all carry it. I think what you are referring to are the things which were in existence at one time, and there may be some still, in which apparatus not made by us or our licensees was used for broadcasting purposes, and there I think we did have a

royalty arrangement, and that was reduced at one time to $1 or something of that kind. So far as I know, there is no such thing as that, and it couldn't obtain in very many cases anyway because so many of the stations are furnished either by Western Electric or R. C. A. or General Electric or Westinghouse Co. or other licensees.

Mr. DAVIS. They all have licenses from you, you mean.

Dr. JEWETT. They are all licensed to manufacture this stuff. In what I said about getting out of the business, I was really talking about getting out of the broadcasting business as a service.

DISTRIBUTION OF TITLE TO BELL SYSTEM PATENTS

Mr. DAVIS. Well, now, of the 15,0001 patents which are owned by your company, which I believe is the number used here, Senator O'Mahoney, they are all held by the A. T. & T. itself, rather than the subsidiary companies, are they not?

Dr. JEWETT. No; they are not, Judge. The title to the patents is in three different positions at the present time. The title to some of the licenses which were entered into 50 or 60 years ago with regard to the use within the system is in the A. T. & T. Co.; the title to some of them is in the Western Electric Co., and title to those in transit, generated in the Bell Laboratories, is in Bell Laboratories. The division between the A. T. & T. and Western Electric Co. is the result of the so-called 1882 contract, before the Western Electric Co. became a part of the Bell system, or the contract was entered into way back in those days, which was a contract between two independent people in which, roughly speaking, telephone-appliance patents ownership is in the Western Electric Co., and telephone patents, things like the transmitter, receiver, and transmission apparatus, is in the hands of the A. T. & T. Co.

That is the result of a very ancient contractual relationship. And there is this third group which I have indicated which comprises only patents which were generated in Bell Laboratories, in which the title to those patents temporarily is in Bell Laboratories.

FUNDAMENTAL AND SUBSEQUENT DEVELOPMENT PATENTS OF BELL

SYSTEM

Mr. DAVIS. Were any of the key or fundamental inventions in the telephonic art discovered in your laboratory?

Dr. JEWETT. Yes. I am glad you asked that question because it bears on a question that the Senator asked, I think a while back. I think it is inevitable that the great bulk of what you might call the run-of-the-mine patents in an industry like ours will inevitably come from your own people, from your running a research department. I think that it is equally the case that those few fundamental patents, the things which really mark big changes in the art, are more likely to come from the outside than from the inside. There aren't very many of those. I am getting around to answer your question.

When I try to think of what are the fundamental patents, leaving out Bell's original patents which have been in the telephone business during its lifetime, which changed the whole picture of the future, there are only three of them. One of them came completely from the

I Note that this number was subsequently corrected to read 9,500. See "Exhibit No. 244" entered in the record on Feb. 8, 1939, and included in the appendix, on p. 1158.