INNOVATION AND THE EVOLUTION OF BELL LABS

From inventing the transistor to finding world-changing applications for the laser — and much, much more — Bell Laboratories was this industry's cradle of innovation for decades.

Which makes it all the more interesting when Dave Belanger, currently chief scientist for AT&T Labs and head of research for AT&T Research — the progeny of Bell Labs — made a point of distinguishing between “invention” and “innovation” in conversations for this story.

According Belanger, AT&T is still very much involved in pure technical research and invention. But at the same time, the influence of so-called business model innovation — changing how the industry and AT&T does business — “absolutely” impacts how AT&T's lab and research arms work today. “We now think much more about how will the technologies we are working on will be monetized and what kinds of business models make sense,” Belanger said. “From my point of view, that's just wonderful. Researchers react very well when the kinds of things they do might make a visible difference.”

Bell Labs Today

While no longer known as Bell Labs, its roots run deep at AT&T. Belanger's group include 1300 engineers and scientists, still generating somewhere in the range of two patents per day. The focus is on pure research, network operations, services and customer-facing apps. While the lab remains “a major part of the innovation pipeline at AT&T,” Belanger pointed out it's a relatively small part of the overall technical community — or about one-tenth of all the engineers and technologists the company employs.

What's Different?

“One of the biggest changes in the labs, post-divestiture, is that the technical ecosystem we live in is very different to support the pace with which innovation needs to occur,” Belanger said. “We in the labs spend a lot more time with people in our sales, our customers and with the people designing products.” In addition to providing technical guidance, a big focus of the labs is helping to determine “what technology has the potential to produce disruptive services,” he said, as well as how to produce those services “at scale” — a challenge AT&T has in common with other research-driven tech companies these days, such as Google.

Whither Innovation?

“One of the ways to view this is at any time there's a huge amount of innovation that is going on that is very visible, and there is also a lot that is not so visible to lay people” Belanger said. “The part now that is extremely quick and extremely visible is happening on the Web. The innovations there have an interesting characteristic. They are not the direct result of decades of research, rather they express their value very quickly — and in a monetary sense, stunningly quickly — compared to what we've seen years ago. Much of the innovation in those spaces is getting something just right — social networks are a good example. Many, many people have ideas in this area; they get tried out in public, crowd evaluation. That's an approach to innovation that is extraordinarily valuable and simply wasn't available 20 years ago.”

Evolving Innovation

AT&T research groups are learning from such Web efforts. They try out new innovations and get “crowd-sourced” feedback from AT&T's internal community. They've also started a venture capital group to fund the best ideas. More than anything, researchers have started asking new questions, such as “What happens when everybody has access to every video ever made?” That kind of thinking led AT&T researchers to play a key role in the winning group in the recent Netflix recommendation software contest. “As researchers,” Belanger said, “one of the things we are doing today is looking at what technologically the world is going to look like down the road and what technology is likely to disrupt the marketplace.”