by Edward Tatnall Canby
The Corporate Block: International Trade
AND WHAT has this young Leap Year of 1972 brought us in its first months? Mainly impasse.
The biggest, most gristly set of deadlocks we have ever experienced. The Corporate Block. It's a trend, alas, and I do not like it. (Does anybody?) Bad for you and me and for the corporations too. Bottles up everything. Stops trade, strangles sales, kills initiative, ruins dispositions. Ugh. No good. But what can be done? It happens more and more often as corporations get bigger and technology grows ever more complex and expensive. Really frightening. No movement.
Just a war of attrition. Is this the be-all and end-all of our Great System, a kind of vast capitalist constipation? Awful idea. But here it is. We are in the middle of it. And I don't expect enough change to make my words out of date when this appears in print.
Though it would be nice if I am proved wrong, at least in part.
The trouble is that our business, our art, like a thousand others, can only survive in motion-production, sales. A fluid, give-and-take competition, like the old fashioned war of movement, as it used to be called in the military manuals. But here we are holed up like 1914, in the trenches.
Stuck. Millions thrown into the contests, dollars and people. Vast super powers, giving their all, out to win.
And what happens? Nothing. Impasse.
So-toss in more millions. Or withdraw with staggering losses. It's an ugly pattern, and I'll bet the corporations would like to get out just as much as we want them to get out (so long as each of them is the winner, of course). It took four years to untangle the mess of 1914. And look at our little old war right now, over there beyond. Are corporate wars the mirror image of "real" wars? I am not thinking of merely one obvious instance of the corporate block today. I have in mind two and a half, to be exact (though there are plenty more), and it'll take me a couple of installments to cover them. Let's look at the half, this month, if only because it shows signs of being an exception to the rule. A prime example of fluidity, if in an unexpected quarter. International trade.
In audio-that insufficient term which now expands to cover all sorts of aspects in the media, arts, communications-we exist by virtue of a powerful triangle of forces. Engineering, science, audio itself, is just one strong leg. On its own, it is meaningless.
Another leg is art. Software, as the Educators put it. What good is audio without a signal? What good is a signal without a message, useful and/or entertaining, practical and/or beautiful? Third, as you can guess, is the all embracing link, that binding force for practicality, business. An immense array of talent, and knowhow, and organization, that spreads all the way from mass-production manufacturing out to sales and distribution. Business without product is a vacuum. Our business leg depends equally on the other two, our engineering hardware and our signal software. Out at the sharp point of the whole danged triangle stands-lo!-the customer! What a superb idea. The customer is IT. Keeps the whole thing going. But now we have the corporate block. And we aren't even getting to him. The product gets talked about. But not sold. Conception, gestation--and then, no birth.
It's awful. And dangerous. One way or another, movement is essential.
The one good thing, you see, about all the fuss over international trade in our area (which is very heavily affected as we all know) is that this business remains fluid. There are no serious impasses, however deadly the arguments.
Vast pressures, heated fights, violent opinions; but movement continues. The rest, in a way, is normal. We can take the fight. Strictly part of life, after all.
What we can't take is a freeze.
Thanks to the shrinking of the mighty dollar, it is dawning on us--even if our pride has dropped 8 percent-that now we can sell, over there, for less; and they have to sell, over here, for more. Realistic, and it undoubtedly reflects actual technological and economic balances more accurately than did the old puffed-up dollar.
Only the tourists (ours) suffer. Even so, I remain marginally uneasy myself.
We can so easily slide on into another kind of impasse, the kind that chokes off impetus for new development and profit and the competitive instinct that takes all comers and is constructive. I do not like to see any cherished American technology giving way to foreign competition, for any reason at all. I can't help feeling that the legitimate complaints about lower foreign costs, wages, etc., though true, are an excuse that we cannot afford to live with. It is the old story-production, or else. If we can no longer build our own products, if we must turn ourselves into mere salesmen and consumers (while the cash lasts), for other peoples' products, then we are on the downslide. We have always been a nation of innovators, designers, producers, carriers out, organizers, distributors-the whole bit. We still are. But are we slipping, in a few areas (especially in our own, right here), into second-hand dealers? Are we, for business reasons, shutting down on our own on-going native know-how, in favor of somebody elses? It seems so, and I hate to see it. The beginning of the end. The Roman Empire. We are there, if we don't look out. The Greeks put it well, as they did. Look to our laurels.
Like a pianist who doesn't practice every day, we'll soon go rusty, selling other's products, and then slide implacably, over the long run, down into ignorance. Not yet. It's just a possibility. But watch out. Practice makes perfect. Neglect leads to--well, you name it.
Are we to hide behind protection? Such an easy way out that most business people have the sense to avoid it, like a drug. Just slap on an import quota and/or a good stiff tariff for the imports, and then sit back to make cash, hand over fist. Ostrich like. We cannot ever hope to stay in planetary business on that basis. And to live that way inside our own walls is just an illusory hope. No longer, Not on this planet. Again, we must keep fluid, keep up with the international Joneses.
Anything else is an invitation to deterioration.
It isn't a matter, you see, as to whether we "approve" somebody else's system, of labor, finance, government interference and support. It is the result that counts. If they produce a better product, we won't make it worse by talking. Nor by keeping it out of our fair country. What matters is-do we still want our leadership, or don't we? We can't count on it any more, as we used to. To mix a metaphor, if you think we can rest on our laurels, you're going to find they're made of hawthorn branches, with big, fat thorns, an inch long. Ouch! Actually, it would seem that the dollar devaluation will work out to a lessening of the trouble that has been so bad of late, too many imports and not enough exports. And so we may hope, not for more protection, but for a more realistic competition between our goods and theirs. OK! Nothing could be more heartening for our own future and our profits, and I am sure that most of us can take the deflation in our national pride with a bit of good philosophy. After all, we've been the fat king of the roost now for a long time. Do us good to work off some fat, get back into condition.
You see how my theme of fluidity comes in. In a free and easy competitive situation, things balance out and genuine trade is the end result. You have something I can use, I have another thing you can use. I do so-and-so best, you do such-and-such best.
Trade for trade. It works inside our country. It must work outside too. It has to. No-I don't mean that trade is a bed of roses. It seldom is, as anybody knows, however polite the exterior. But what matters is, however ruthless the details, that the whole thing be fluid and in movement. No impasses. No deadlocks.
Yes, of course there must be head-on competition. I didn't mean to exclude that! Our hi-fi receivers vs. theirs, both aiming at the selfsame niche in the market place. Absolutely a part of all trade, along with the give and take, the you-have-something and I–have-something. Maybe the Japanese can make the best three-inch color TV, and maybe we can edge them out in the large-size models-but in between, it's cheek to jowl, model for model, GE, Zenith, RCA against Sony, Sansui and so on. No quarter. But, please, no artificial restraints either, no short-sighted, wishful-thinking arguments that reduce pure competition.
Yes, I know that the idea isn't pleasant for those on the competitive line.
It's easy for me to talk. It is so easy to go for the argument that the other side's system isn't fair, our law, our principles, our set-up, doesn't allow us to complete. True, the differences exist.
We must cope with them, or else.
Somehow, our traditional ingenuity must be forced into new channels, to find the means to meet the "enemy" not on his own ground but on ours, not via his system but via our own.
A thousand little bits of that sort of ingenuity are already turning up among our still-ingenious industrial designers, whereby we are learning to meet the foreign competition as we have to, directly, in, so to speak, hand to hand combat.
I was heartened, for instance, by a recent visit to Advent's new factory in Cambridge, Mass. They gave me the grand tour after some kind words I dropped awhile back concerning their espousal of the hi-fi cassette. Advent's first cassette machine, the 200 deck, was, as might be expected, Japanese.
An import ("to our specifications," of course). But in the newer Model 201, Advent has switched back to all-American product. That switch, I was given to understand, was possible because of purely technical ingenuity in getting around the low cost of production inherent in the imported product. (This was before the 8 percent jump.) Part of it is to the credit of 3M, which makes the basic and very American "chassis," typically solid, with the big flywheel and the record changer-like mechanical controls, the clanky, springy sort that go zing when you shift gears. Feels exactly like a record changer.
Advent's contribution, or rather, one contribution that I can remember, is an extension of that very idea. Quick thinking. Now, it seems that wiring is one of the big costs of circuit-board production. Suppose, instead of building the boards and what-not so they wire out to the compound switches on the control panel, let's build for the least wiring, and then put in the switches one by one, where they fall, at the most economical point.
How to hook them up? There you are! Just extend the familiar mechanics of the record changer sort, so that a single outside control simultaneously shifts three of four different switches in different places. Advent's mechanical assemblies for this purpose, lowered into the chassis on jigs to fit onto the circuit board lay-out, had me absolutely cross-eyed. All I know is, you push a lever here, and switches pop all over the place, as neatly as you please. Rube Goldberg, brought up to date! Everything is taken care of in this way, from Dolby and Chrome circuits to RECORD and PLAY. SO, you see, U.S. ingenuity meets the competition, not directly but around the flank. That's the way, boys. If it's wiring that costs too much, then don't have wiring. The mountain goes to Mohamet, the steel arms go out to the switches and flip
'em, right in place. Crazy, man. You see what I mean.
And so we get into real competition, fluid and full of movement. I keep thinking of Westminster's old trade mark, out of context, "natural balance." Free competition, however ruthless, has always tended to align things for the best, or if you wish, for better and better. The on-going fight is healthy, for it tends to call bluffs, puncture pretences, show up faults, shoot down overblown public relations claims, and generally to get us all down to reality and may the best man really win. It has worked that way remarkably well in the good old U.S. all things considered. And it has done so right up until recently. Take the LP vs. the 45, the famed "record war" of years back. See how beautifully that all-out war of movement steered the varying competitive new types of disc, each to its proper useful sphere.
That was healthy competition, it was fluid, and in spite of all our squawks, it worked out well. Because there were products on the market, there was business.
Even as recently as 1958 when the big fight over stereo disc came to a head, the results were healthy. And that in spite of the long, painful period when mono and stereo discs were both offered. Technology got ahead of itself there, but gradually caught up in a hundred ways, until the mono record (a) faded out and (b) became compatible via improved stereo cartridges and better stereo cutting (for less wear via the mono players still remaining). Nobody says it was a period of halcyon rejoicing. The stereo fights were plenty bitter. But things did remain fluid, products appeared, both discs and playing equipment, and it was bought by consumers. There was movement. And enough compatibility so that the big triangle of engineering, software, and business could stay together. Production and consumption went on. And so all was well in the end. It was even like that back in 1901, when the 78 disc was compounded out of a vast pooling of patents that in fact had brought business to a complete standstill, each of a number of systems implacably out to kill and win. They knew, back then.
Do they know now? Yes--but how? How to compromise, but not disastrously, is the name of the game, and in international trade we seem to be finding the constructive way to do it.
Good.
But in the two major areas that round out my 2 1/2, the picture is very bad. Maybe by the time I continue this it will be better. In both, there is deadlock. Implacably competing systems, incompatible, and nobody willing to give an inch. Will the so-called video-cassette (including the video disc) suddenly start moving? A dozen systems and not even the magnetic tapes have been able to get together very far, let alone the big new systems like EVR and SelectaVision.
And the four-channel disc? On a smaller scale, the same story. Monkey wrenches. (Spanners to our British editor, in case he doesn't get me.) Millions of bucks lined up back of incompatible systems. Products announced but unlaunched. Products launched but unavailable. Products barely available, but unsold. The corporate block for fair. Trench warfare.
How long will it last?
(Audio magazine, Mar. 1972; Edward Tatnall Canby)
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