Alexander Graham Bell
Alexander Graham Bell at the opening of the long-distance line from New York to Chicago, 1892. Source: Library of Congress

On the same day in June 1876 that George Armstrong Custer met his maker at Little Big Horn, Alexander Graham Bell unveiled an invention that would change the world. At an exposition in Philadelphia, 2,000 miles to the east, Bell’s “electrical speech machine” was quickly (and thankfully) dubbed the “telephone.”

In 1900, 24 years later, another inventor named George Eastman introduced his Kodak “Brownie” box camera and put low-cost, efficient photography within the reach of the average citizen.

The stumbling blocks for further innovation today come not from entrepreneurs, venture capitalists or the marketplace, but from the regulators.

And a century after that, the ideas of these two men would form the backdrop for combining the camera and telephone into a single unit that would take the market by storm.

Today, the camera phone may be the fastest-growing consumer technology marvel in history. Since it was first introduced in Japan barely three years ago, at least 80 million have reportedly been sold worldwide. From a price as high as $400 barely a year ago, much-improved camera phones now sell for about a quarter of that amount, or less. At least one company is even giving them away, if consumers agree to sign up for monthly service.

For his telephone, Bell earned U.S. Patent No. 174,465 — the single most valuable patent ever issued. However, the former teacher of the deaf did not regard the telephone as his most important invention. He personally assigned that honor to what he called his “photophone,” a device that transmitted sound on a beam of light instead of by electricity. Outside interferences such as weather severely inhibited its implementation and it went nowhere. But it was the precursor to fiber optics, upon which a growing portion of our telecommunications system today relies.

When George Eastman began tinkering with photography in the 1870s, cameras were monstrously big, almost too heavy to carry, and hugely expensive. By 1888, he had simplified the camera to the size of a box of Kleenex. By 1900, he had cut the cost to the consumer to just $1 for the camera and 15 cents for a roll of film.

Bell and Eastman were contemporaries (the former died in 1922 at the age of 75, the latter in 1932 at the age of 78). Both men would undoubtedly be delighted at how modern science and the profit motive have merged the technologies in their respective devices. It’s fascinating to ponder what they might say about the lessons of it all. Because both were practical businessmen, it’s not a stretch to think they might offer some observations along these lines:

        1. No central planner could have foreseen what either man did in his time, or what their successors have since done in ours. The telephone, the camera, and the camera phone are all tributes to the spontaneous order of the free, entrepreneurial marketplace, unplanned by bureaucrats. They didn’t require a government venture capital fund, tax-funded subsidies, or job training grants — only an environment of low taxes, minimal regulation and freewheeling risk-taking by the inventors and marketers themselves. Like the Wright Brothers who invented the airplane on their own nickel and bested their government-subsidized competition (http://www.mackinac.org/5539), Bell and Eastman didn’t need the taxpayers’ money.

        2. Wealthy citizens played key roles in the story. They not only were the prime sources of capital to get these inventions off the ground, they were the only ones who could afford to buy the early versions. Those purchases helped cover the initial high costs and enormous risks. The same is true for almost every other invention. For the same reason I am happy that wealthy people bought the first laptops when they sold for $4,000, I know that some day I’ll be able to buy one of those new plasma televisions for a fraction of today’s price.

        3. The stumbling blocks for further innovation today come not from entrepreneurs, venture capitalists or the marketplace, but from the regulators. Cellular and wireless technologies are poised for growth but are stymied by archaic rules. “The result,” writes Forbes magazine’s Scott Woolley, “is that one of America’s most valuable natural resources (the airwaves) sits paralyzed, consigned to uses that time and technology have long since passed by.”

The next time you use or observe a camera phone, consider the genius of those whose risks and foresight made them possible. In a free enterprise system, such things may be “unplanned” but they are not “accidental.”

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Lawrence W. Reed is president of the Mackinac Center for Public Policy, a research and educational institute headquartered in Midland, Michigan. More information is available at www.mackinac.org. Permission to reprint in whole or in part is hereby granted, provided the author and his affiliation are cited.

Summary

No central planners or government grants placed the telephone or the camera in the hands of the common man and woman. But government regulations are thwarting market development of other technological marvels.

Main Text Word Count: 720

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