in Futurist, Musings

Innovation and competition


The book The Idea Factory made me question what we know about innovation and the free market.

Conventional wisdom says that a free enterprise system that rewards innovators with market success is what drives innovation in this country. However, this was not the case at the fabled Bell Labs, where brilliant AT&T scientists brought forth a dizzying number of groundbreaking discoveries, one after another.

AT&T of course was a monopoly, free of market pressures. It’s scientists were under no pressure to beat the competition nor were they bound to any particular deadlines. There was no drive to turn in a better quarter than the last, or to beat analysts’ estimates, yet these incredibly brilliant men created the transistor, laser, fiber optics, solar photovoltaics, and so many other astounding innovations.

These inventors were free to think, and to think long-term. Competition has its place, don’t get me wrong, but in the case of truly epochal innovations it might just get in the way.