Wednesday, May 13, 2009

Brainless Forecasting: Remembering the Telephone

One of the lessons of the current recession is that we are, more often than not, just plain clueless when it comes to forecasting our economic future.  And it’s not for a lack of trying.  We give the smartest people in America reams of market data, we create marvelously complex forecasting models, and we end up with vastly conflicting, generally misguided points of view.

More than that, we completely miss the Big Events--the current recession being a good example.

It is the American condition, however, that being bad at something doesn’t stop us from doing it, and doing it enthusiastically.

With this in mind, I’ve been watching the swirl over Twitter, Facebook, the future of search, Second Life, radio, the music industry, the electric automobile, and television.  Not only is the debate about our technology future downright confusing, it’s downright nasty.  Technology has become our new religion, our new politics.  To say you support “open source” in certain cocktail settings is like saying you would like to see a socialist President, or suggesting that only Christians can get into heaven.  It’s brutal out there.

This is what I was thinking as I read Ithiel de Sola Pool’s 1977 The Social Impact of the Phone.  In particular, one chapter examines all of the forecasts made about the telephone from 1876 to WWII.  It's a good reminder that we—all of us, worldwide and over time--are really, truly are bad at this forecasting stuff.

The “Just Don’t Get It” Forecast. In 1879, Sir William Preece, the chief engineer of the British Post Office, testified before the House of Commons about the telelphone: “I fancy the descriptions we get of its use in America are a little exaggerated, though there are conditions in America which necessitate the use of such instruments more than here.  Here we have a superabundance of messengers, errand boys and things of that kind.  The absence of servants has compelled Americans to adopt communication systems for domestic purposes.  Few have worked at the telephone much more than I have.  I have one in my office, but more for show.  If I want to send a message—I use a sounder or employ a boy to take it.

The "Get It Even Less If That’s Possible” Forecast.  Joseph Gurney Cannon, the future Speaker of the United States House, describing the phone in 1878: “A damned old Yankee notion (a piece of wire with two Texas steer horns attached to the ends with an arrangement to make the concern bleat like a calf) called a telephone.”

The “Get It Too Much” Forecast.  General Carty, the Chief Engineer of AT&T, predicted the advent of international telephony, forecasting that it would bring peace on earth: “Someday we will build up a world telephone system making necessary to all peoples the use of a common language. . .which will join all the people of the earth into one brotherhood.”

The “Economic Doom” Forecast.  Anyone with a rudimentary grasp of math could see that the number of people using the phone increased the operators’ work exponentially, soon making it impossible for the system to operate.  Some could not see the advent of automatic exchanges.  One early telephone manager commented that “So far as he could see, all he had to do was get enough subscribers and the company would go broke.”

The “Technology Assists Evil” Forecast.  A muckraking article in the 1907 Cosmopolitan Magazine reported that “Every one of the estimated four thousand pool rooms throughout the United States is equipped with telephones used for gambling purposes and for nothing else.”  Further, the article said, the telephone company knows full well who the criminal users are and does nothing to stop them.

The “Technology Assists Good” Forecast.  Many felt that the telephone would bring a decline in crime, for criminals would have little chance of escape one the telephone was everywhere and police could be notified ahead about a fleeing culprit.
The “In-Love with Current Technology” Forecast.  Elisha Grey of Western Union could probably have invented the telephone a year before Bell had he realized its commercial value.  In 1875 he wrote, “Bell seems to be spending all his energies on [the] talking telegraph.  While this is very interesting scientifically, it has no commercial value at present, for they can do more business over a line by methods already in use than by that system.”
A Grand Sociological Forecast.  By 1910 it was hard not to find a forecast that didn’t predict the phone (and the auto) would break the killing isolation of farm life, encouraging children to take up their parents’ trade and stay on the farm.  Needless to say, the 20th century saw one long, unbroken exodus from the American farm.
Lesson #9: When everyone agrees it’s time to worry.

So the question is: Was anyone, anywhere, at any time, able to create a balanced, credible forecast for the telephone?   You bet.  And it happened right off the bat.  

See here.