McGuire’s Law

Nearly two years ago, I introduced the concept of “Big Bell Dogma” on this blog. I also discussed the concept last year in my book.

Since that time, I’ve found the concept very useful for many purposes, but I’ve never gone back to do a good job of defining what Big Bell Dogma really is or why it matters. Today I plan to fill that gap.

The name “Big Bell Dogma” is a reference to the original “Ma Bell” – AT&T – when they were the nationwide monopoly for telecom services in the United States. (Of course, there were other monopoly telephone companies serving specific cities and regions, including GTE and United Telephone – later renamed Sprint and then Embarq, but none of them had the power or arrogance of Ma Bell.) The “Dogma” piece comes from the attitude of the monster monopolist which played itself out in a series of beliefs that shaped decisions and actions made by the company.

Some good examples come from a few of my favorite books:

Nerds 2.0.1: A Brief History of the Internet by Stephen Segaller was originally a PBS series (which I’ve never seen) but became a book which is a fascinating read if you’re into history, technology, or both. In the book, there are a series of quotes from the men and women behind the original creation of ARPnet (the Internet), including several that describe AT&T’s “Big Bell Dogma.”

Larry Roberts: “I gave speeches about this in the 1967-to-1969 timeframe…Defense Communications Agency; AT&T; and the other people around had all these engineers who actually booed and hissed… ‘Everything would go wrong, and it couldn’t possibly work.’ … AT&T and DCA laughed at me. In fact, they more than laughed. They actually were very nasty. I felt like people were throwing rotten eggs at me when I was giving speeches as we were preparing for this, because they basically thought we were crazy.”

Dave Walden: “The telephone companies seemed to me to be working pretty hard to discredit packet switching. They would go give speeches. They’d talk to their customers and say this isn’t a good idea. It can’t be. The telephony attitude is not very compatible with packet switching… the telephony attitude is about guaranteed levels of service and capacity. It’s about investments that you make that you get back over decades.”

Len Kleinrock: “I would say, ‘Please give us good data communications,’ and they would reply, ‘The United States is a copper mine – we have phone lines everywhere so use the telephone network.’ I would counter, ‘But you don’t understand, it takes twenty-five seconds to set up a call, you charge me for a minimum three minutes, and all I want is to send a millisecond of data.’ Their reply was, ‘Go away, children, the revenue stream from data transmission is dwarfed by that of our voice traffic.’ So the children went away and created the Internet!”

Bob Taylor: “When I asked AT&T to participate in the ARPAnet, they assured me that packet switching wouldn’t work. So that didn’t go very far.”

Another great technology history book is Wireless Nation: The Frenzied Launch of the Cellular Revolution in America by James B. Murray, Jr.

In it, the author describes AT&T’s behavior when the first cellular spectrum licenses were distributed by the FCC: “On June 8, the day following the Round I filings, AT&T and GTE announced that they and the rest of the wireline applicants had agreed to split ownership of the top thirty markets. The two wireline heavyweights had successfully intimidated scores of smaller independent telephone companies, convincing them that they could never assemble the capital or expertise needed to launch these new cell phone businesses. If the small companies would just stand aside, AT&T and GTE declared, they would graciously condescend to share minority interests in the contested markets. But AT&T and GTE would, of course, be in charge – and they would bill their minority partners for the service.”

A third fascinating read is End of the Line: The Rise and Fall of AT&T by Leslie Cauley.

A small part of the AT&T story is how, at the breakup of AT&T and the formation of the seven “baby bells,” AT&T gave away the nationwide cellular licenses described above. Cauley describes it this way: “They also got AT&T’s operational licenses for a brand-new service that appeared to have no future. …That cache of operational licenses? They were wireless licenses. … At the time nobody expected wireless to amount to much. AT&T’s own internal studies had concluded that the wireless market might attract 1 million users, at most. So when a young attorney named John Zeglis urged Brown to give the licenses to the Bells as a consolation prize, he didn’t hesitate.”

However, Big Bell Dogma isn’t just about how Ma Bell historically acted. In fact, a more accurate name might be Incumbent Intransigence, but Big Bell Dogma sounds so much better!

Big Bell Dogma stems from the power that comes from incumbency. Any person or organization creates power over time. For companies, this power comes from their market position, their relationships with customers, their brand, their physical assets, etc. For individuals, this power comes from knowledge and experience, and from relationships with others that enable them to be successful doing their jobs.

The net result is that, over time, any new idea or change becomes a threat to this power.

Think about your own job, assuming you’re currently successful. If tomorrow your boss came to you and said “I’m transferring you to a new group to do a new job that you’ve never done before working with people you don’t know,” your confidence in your ability to succeed undoubtedly would be challenged and you’d immediately want to do whatever you could to stay where you are doing what you’re doing (and maybe get a promotion that incrementally adds to the scope of your current success).

The same holds true for companies.

And the more entrenched an incumbent is, the less flexible they become, the less open they are to new ways of doing things, and the more aggressively they attack anyone who tries to introduce new ideas into the marketplace.

It’s easy to point at Sprint’s two largest competitors, who happen to still be “Big Bells” and tag them with the BBD tag, but I recognize that anyone who has any incumbency at all suffers to some degree from this malady. I try to spot the symptoms in my own behavior and self-correct before I kill a really good idea.

So, what are the symptoms? The attitudes that, to me, are symptomatic of Big Bell Dogma include:

• Change is risky. Status quo is safe.
  Status quo protects the stability of networks and systems. It also protects the power of incumbents.
• Flexibility is risky. Rigidity is safe.
  Flexibility introduces uncertainty which threatens the performance of the networks and systems. It also threatens well understood and steady cash flows.
• Distributed control is risky. Centralized control is safe.
  Centralized control ensures that nothing happens without an understanding of the impacts on all aspects of the system and without the ability to “roll back” to the previous stable state. It also ensures that incumbents are in control and determine which changes are in their best interest.

Can you spot these attitudes in your own behaviors? Are you willing to drive them out?

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Now playing: Greg Adkins – On The Edge