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Ideas are the chief products at celebrated Bell Labs, where 4,575 scientists are engaged in what Kappel calls "the exploration of dreams." The dreams range from figuring out ways to stop squirrels from chewing up telephone wires to devising a typewriter that could work by oral dictation.
Endowed with virtually unlimited resources and free dom, Bell Lab scientists have made such major breakthrough discoveries as radio astronomy, magnetic-tape recorders, hifi, and the most important invention since World War II, the transistor. Thanks to the transistor.
Bell next year will begin to slowly convert to a fully electronic switching system that will enable the phone user to reach frequently called numbers by dialing only two digits, to call third parties onto the line, and to switch incoming calls to other numbers if he leaves his home or office. What next? At their yellow brick headquarters, which sprawls like a Pentagon of science over the wooded hills of Murray Hill, N.J., Bell's crew-cut mathematicians, physicists and chemists—many of them not yet 30—are working on pocket phones, wristwatch phones, and laser beams that someday will replace wires and microwaves as carriers of the spoken word. A Basic Difference. Looking toward his own tomorrow, Fred Kappel knows that A.T.&T.'s inflexible retireby-65 rule will compel him to step down within three years. He also knows that though personnel and products will change, A.T.&T.'s philosophy has been too successful for anyone to tamper with it. "The first thing," says Kappel, "is to make sure that we don't ever settle for second best." As a company that sells service in an economy whose biggest growth area is service, A.T.&T. can hardly help prospering and expanding rapidly. "There's a basic difference between us and a manufacturing concern," says Kappel. "They have a judgment whether they want to expand or not. We have no choice. We are obliged to serve people adequately, and so we are always going to be growing."
* Largest individual owner: Showman Billy Rose, whose 80,000 shares, worth $11.2 million at the current price of $140 each, have brought him $288,000 in dividends during the past year.