Reading :: The Fall of the Bell System

Originally posted: Thu, 17 Feb 2005 12:05:28

The Fall of the Bell System : A Study in Prices and Politics

by Peter Temin

In the Preface of this book, Peter Temin thanks AT&T for commissioning this historical study and providing complete access. The relationship with AT&T shows -- The Fall of the Bell System is rather sympathetic to AT&T's position throughout -- but nevertheless the book is painstakingly researched and documented, and provides a surprising level of detail into what led to Ma Bell's breakup.

I read the book primarily with an eye toward universal service, and in that respect, the book provided some startling insights. In an earlier review, I discussed Milton Mueller's claim that the term "universal service," though it has been attributed with a unitary, fixed meaning, has changed distinctly over the years. In the course of his argument, Mueller claimed that the second definition of universal service -- 100% market penetration brought about in part by low prices -- was made possible by cross-subsidies. That is, Bell charged far more for long distance than it actually cost, then used the excess revenue to support local service. Okay. But Temin takes a different tack. He assumes that "universal service" has a fixed meaning, then goes about carefully showing that "cross-subsidies" had several different definitions!

In other words, it looks like both authors have nailed down one term in order to show the vagaries of the other.

Let's talk a bit about universal service first. Temin portrays the Bell System as a quasi-public utility run as a regulated monopoly: "Faithful to its role as steward of the nation's telephone network, the Bell System had worked for close to a century to keep ahead of the public's demand for service" (p.3). Part of this stewardship role was universal service, and Temin explains this concept succinctly, compressing two definitions of universal service and attributing the combination to Theodore Vail: "The Bell System had attained the goal stated early in the century by AT&T's legendary president, Theodore Vail: to provide every household with a telephone connected to every other telephone. 'Universal service' having been achieved, it was not at all clear where the System should go" (p.6; see also p.16). Twenty years after Vail's proclamation of universal service as a goal, Walter Gifford proclaimed that AT&T had an "unusual obligation" to provide adequate and dependable service (p.16) -- an indication that even though universal service may have been rearticulated in the 1970s, the rearticulation was not as radical nor as calculated as Mueller suggested. Indeed, Temin provides considerable evidence to suggest that the 1970s rearticulation was consistent with core values that Bell had developed in the intervening years.

The stage for the rearticulation of universal service was set by Vail's reorganization of the Bell Operating Companies, a reorganization that lasted from 1909 until (depending on how you count it) 1972 or 1979.

The companies were organized along functional lines, with three main departments: Plant, Traffic, and Commercial. Since each department contained people with similar skills and training, this style of organization facilitated internal communication and promoted operational efficiency. The similarity of format allowed communication between the General Departments at AT&T and the operating companies and between the companies themselves. (p.18)

Notice the focus on internal communication and operational efficiency, which are appropriate for Vail's strategy of becoming a regulated monopoly. This was consistent with the logic of the age, in which the rationalization of industry was seen as promoting efficiency, and efficiency was seen as an unmitigated good (pp.343-344). (Part of Temin's problem, I think, is that he accepts the logic of efficiency so fully that he evaluates deregulation in terms of how it irrationally fails to meet the goal of efficiency.) Vail's reorganization arguably outlasted its usefulness: it positioned AT&T well for the task of taking over phone service, but it did not serve well when long distance competition surfaced in the late 1950s and especially during the bad years of the 1970s. After deregulation, this structure had to give way to one of deep interpenetration -- in which workers had to be in close contact and collaboration with their counterparts at competing companies.

At any rate, the organization Vail put into place lasted until 1972, when AT&T was reorganized by markets (p.79). But that reorganization left AT&T's core values and traditions intact (p. 150, 162), so AT&T was re-reorganized in 1979 (p.164), reorienting to the business market.

Between these reorganizations, of course, a lot of other things were happening. For instance, during World War II, the use of long distance skyrocketed:

Between 1939 and 1942, the number of telephone messages carried by Long Lones had shot up from 60 to 114 million. Long Lines' profits naturally had risen too, and the FCC had asked AT&T to show cause why its interstate rates should not be reduced. Walter Gifford promptly and indignantly responded that the Bell System was engaged with the government in fighting the war. AT&T was struggling to handle the increased volume of war-related traffic; it was advertising to convince the public to call less often. Lower rates would encourage people to call more frequently. "I fail to see," Gifford concluded, "how by any stretch of the imagination a reduction in long distance rates will help win the war." (p.20)

So how could the FCC reduce long distance profits without reducing the rates? The result of this short-term decision reverberated across the following decades. For the FCC decided it was worthwhile to separate calls between interstate and intrastate jurisdictions so the rates of return could be separated. The question of how to do this was not obvious. One could conceptualize the network in two ways. In the "station to station" conceptualization, the toll call goes from one phone all the way to the other; everything in the middle, every switch and every line, collectively constitutes the toll call. In the "board to board" conceptualization, the toll call is only the portion of the call that goes from one switch to another; from the switch to the phone is considered to be local service on either end (p.20).

Since the Bell System was organized as a single long distance carrier (Long Lines) that connected local operating companies -- which were distinct in legal and regulatory status -- it was easier to implement, calculate, and conceptualize board-to-board charges. Station-to-station charges would be far harder to calculate, since "some way has to be found to separate the portion of the costs of the local exchange that can be related to toll calls from the costs resulting from local exchange service" -- that is, if you use the station-to-station method, you have to figure out how to distinguish true local service from phone-to-local-switch long distance-related service (p.21). The problem came to a head in the 1930 Supreme Court decision Smith v. Illinois Bell, in which the Court declared that the station-to-station conceptualization was the standard for determining if rates had been set too low (p.22). This decision became the basis for the FCC's solution to their wartime problem: In 1942, the FCC required AT&T to use station-to-station accounting. Doing so would add access charges from the local company to the long distance service, raising long distance rates (and constraining wartime demand) while denying AT&T increased profits (p.22). At the same time, "local rates would fall, encouraging universal service" (p.23). AT&T acceeded, although it still used board-to-board accounting internally (p.23). Separations -- and cross-subsidies -- were born out of this wartime solution.

But cross-subsidies were hard to define. Under AT&T's internal board-to-board accounting, "any division of revenue is a cross-subsidy flowing from the interstate (toll) jurisdiction to the intrastate (local) jurisdiction" (pp.24-25). But the FCC tried to define the term "cross-subsidization" in 1950 as deviations from subscriber line usage (SLU) -- a simple-sounding definition that in practice was arbitrary, varying with changes in usage (pp.24-25).

At the same time, political pressure to keep local rates low led the FCC to further increase the cross-subsidy from long distance to local service -- as technological innovations simultaneously lowered the operating costs of long distance. A large imbalance -- which is to say, a large cross-subsidy -- began to form (p.25). Costs and prices diverged enormously, but the divergence was held together because all services were under the same regulated monopoly (p.27).

This situation began to change as early as the mid 1950s. Competition started in one of the smallest telecommunications niches: private lines. Essentially, private lines are off the network -- they don't conform to the first meaning of universal service. Imagine a private line between offices of the same business, or a line between a bank and its ATM, or the line between the Batcave and Commissioner Gordon's office; one phone is "hardwired" to the other. Plenty of communications-oriented businesses, like the TV networks, had the skill, equipment, and motivation to set up their own private communications using microwave systems (p.28). Motorola became the primary advotate for this arrangement, and in 1959 the FCC allowed them and others to compete in this small market niche. The Above 890 decision, as small as it seemed at the time, was the beginning of the end of the monopoly (p.29).

AT&T's argument against the decision was that it "would encourage 'cream skimming,' that is, the intrusion of independent operations in the most profitable parts of the telephone network" (p.30). AT&T's price averaging had made the price of interstate calls uniform across the country -- averaging, that is, provided another cross-subsidy -- and this monopoly logic was threatened when the most profitable routes could be taken over by competitors, since AT&T would have to raise its rates across the board to compensate for the loss of a profitable route (p.30). Furthermore, unlike AT&T's uniform level of service across the network, competitors could offer lower-quality services -- again meaning that the low-cost, high-profit customers wouldn't be around to subsidize the other customers, resulting in price increases across the board (p.30). These prices were the result of historical as well as geographical averaging, which is to say that price averaging served to pay for aggregated costs in installing infrastructure as well as geographical disparities in providing current service (p.34). The FCC found this argument convincing enough to ban the sharing of microwave systems, but it proceeded with the Above 890 decision, reasoning that it would affect only a tiny fraction of the market. That may have been true at the time, but it fundamentally changed the industry's logic and lay the ground for later competition.

At about the same time, other things were happening that would have a similarly large impact. Hush-a-Phone Corp. v. U.S. (1956) and the FCC's Carterfone decision (1968) together demolished AT&T's longstanding argument that anything connected to its network could be harmful and should be subject to tariff. The hush-a-phone was a small plastic cup that attached to the phone's mouthpiece; the Carterfone was a device that allowed you to relay a phone call from a handset over a radiophone. Neither presented a physical threat to the network, but both presented legal threats; when these two cases were decided in favor of AT&T's competitors, an important wall to competition was eroded (p.43). AT&T tried to salvage the network's integrity by allowing connections through a protective coupling arrangement (PCA), a small device that would fit between the network and the foreign device, providing a clear delineation of where AT&T's network (and responsibility) ended (p.46); but the PCA was later seen as an unreasonable attempt to preserve the monopoly.

When you put together the Above 890 decision, the Hush-a-Phone decision, and the Carterfone decision, you get ... MCI. In 1963, Microwave Communications, Inc. applied for permission to build a private line between St. Louis and Chicago, with the intent to sell capacity to others. This skirted the Above 890 decision, which barred the sharing of facilities, because MCI wasn't sharing facilities -- it was just selling capacity (p.47). MCI framed its service as new, not competitive (p.49); it escaped the nationwide averaging because of this, and it managed to keep costs low by using lower-quality construction, offering lower-quality products, and hiring nonunion laborers (p.50). The FCC accepted MCI's arguments on a 4 to 3 vote (p.50). The consequences would be grave. MCI continued over the years to encroach, until it was in direct competition for conventional long distance -- as we'll see in a moment.

In the meantime, AT&T still saw itself as having a "holy mission of service," according to Temin's sympathetic reading (p.59). Temin argues passionately here that AT&T kept prices low and falling during its monopoly, assuming that those rates would rise with the loss of efficiency that comes with competition (p.59). (In fact, prices have continued to drop rapidly in the post-monopoly era). Temin's implicit argument here and throughout is similar to Mussolini's argument that he made the trains run on time: efficiency is more prized than decentralized competition.

At any rate, by 1970 "universal service had been achieved" (p.62), at least in terms of the first and second iterations of the term. The US had reached over 90% market penetration. So the goal turned from universal service to continuous enhancement of the switched network (p.62). Also at about this time, the network began to take on an abstract identity separate from the Bell System (p.64). By 1972, the FCC gave "permission for people to connect terminal equipment to the telephone network at will" as long as they registered their equipment with the FCC (p.64). (This opened the door for innovations from answering machines to cordless phones.)

These changes roiled the Bell System. When John deButts took over as CEO of AT&T in 1972, he decided to change the focus from technology and network design to the relationship between AT&T and the regional Bell operating companies (RBOCs) (p.71). Along these lines, he began to articulate universal service as high market penetration coupled with low prices (p.72), a tack that allowed him to argue for a regulated monopoly and against cream-skimming by AT&T's competitors. deButts' new focus did not go down well with the FCC.

As a series of proposed tariffs were shot down by the FCC, and competition with MCI began to heat up, AT&T underwent restructuring. The company would now be organized by markets, not operations (p.80). And in congruence with this new orientation, "No longer was the enterprise's central mandate to supply plain old telephone service, and to pursue the goal of universal service. The need was to supply more varied demands than before, to differentiate products for particular customers" (pp.81-82). The problem with this new orientation was that AT&T was not willing to give an inch: it tried to erect its own Maginot Line, competing vigorously in all existing and emerging telecommunications markets, and refusing to let go of the integrated structure that had worked so well in the early days of the monopoly (p.83).

deButts' 1973 talk to the National Association of Regulatory Utility Commissioners (NARUC), entitled "An Unusual Obligation" (a reference to Walter Gifford's 1927 NARUC address), was meant "to defend the public switched network against competition" (p.96). The speech's aggressive positioning was well received within the Bell System, affirming as it did the traditional value of universal service (in its second articulation; see also p.144, where Temin clearly argues that this articulation reflected AT&T's core values in the 1970s). But outside the company it was another story. The speech attracted the attention of those who worried about the company's antitrust status, including "the FCC, the Defense Department, the Senate Judiciary Committee, and the Justice Department" (p.100). At the same time, MCI continued to test the limits of competition, moving to interconnect with Bell's network and positioning in legal, regulatory, and technological terms to expand into long distance service (p.103). But the real trouble began when President Nixon resigned in 1973 (p.108): the weakened executive branch could no longer restrain the Department of Justice, which had long been unhappy with the compromises made on AT&T's behalf. In particular, DoJ wanted to vacate the Consent Decree of 1956, reopening a monopoly suit.

Furthermore, tensions among AT&T's roles were becoming unbearable:

The FCC regarded MCI as a customer of AT&T and was applying regulatory doctrines of nondiscrimination to the Bell System's responses. The Justice Department regarded MCI as a competitor and was applying antitrust standards to these same actions. Both of them, furthermore, regarded AT&T's reactions to the new demands of the network as too aggressive and ungenerous. What appeared to the Bell System to be protective of the network appeared to the Justice Department to be protective instead of AT&T's monopoly. (p.109)

The result: The Department of Justice filed suit against AT&T in 1974 (p.110).

All sorts of maneuvering ensued. AT&T supported the Consumer Communications Reform Act (CCRA), which instantly became known as the "Bell Bill" (pp.118-119). CCRA "reaffirmed the nation's commitment to universal service" (p.119 -- the second articulation), and "bluntly asserted that the existing rate structure, by which it meant primarily separations, had promoted universal service" (p.119). What's more, we start to see hints of the third articulation of universal service, the continual moving of the goalposts: in deButts' testimony to a Congressional subcommittee, he described AT&T's future role as continually developing new communication technologies to add new and better services at lower and lower prices (pp.122-123). The impetus for the current articulation of universal service had begun.

Now we get back to cross-subsidies. Temin complains that the term never really gets nailed down in a satisfactory way. The FCC defined them in one way in 1950, then revised its definition in 1976, meaning that interstate tariffs that showed no cross-subsidy in 1975 would show one in 1976 (p.126)! These were in addition to AT&T's board-to-board definition used before World War II (p.127). To deal with some of this mess, AT&T began to call board-to-board cross-subsidies "contributions" (p.127).

At about the same time, MCI began to offer its Execunet service in 1975. Billed as a private line service, Execunet was gradually revealed as message toll service -- that is, it was connected on either end to the switched network. MCI was offering long distance! And the services were revealed so gradually that the FCC didn't realize it until an AT&T VP went to the Commission's offices and used Execunet to place a long distance call to a recorded weather service in Chicago (pp.132-133)! Now the competition was truly joined. The FCC ruled against MCI, but was overruled in court (p.134). By 1979, AT&T had negotiated a deal with MCI, AT&T, Sprint, and others to use AT&T's Long Lines at a discount (p.140). This deal kept the wolves at bay for a while, allowing AT&T to focus on the other problem: The DoJ lawsuit.

That problem was more intractable. AT&T's lawyers argued in 1978 "that AT&T's traditional corporate goals -- universal service and network optimization -- could not be pursued in a fragmented, competitive market" (p.166). Charles Brown, AT&T's president, re-restructured to complete AT&T's orientation to the market, focusing more on business rather than residential customers. To put it another way, cream skimming was not just acceptable but necessary in a competitive environment; the universal service orientation of a public utility had to give way to the business orientation of a competitive market (p.168). Although deButts was still committed to service as a primary goal and still thought of AT&T as a public utility, he recognized the necessity of the new orientation (p.172). And when Brown took over as CEO in 1979, he completed the turn. He identified three problems:

- First, the cross-subsidies problem: AT&T had to find a way "to balance the need for competition and the need for universal service."

- Second, the tension between competition and an efficient national network.

- Third, the basic character of the industry: was it a public utility or open competition? (p.175)

The first problem became thornier as the 96th Congress (1979) introduced a bill to, among other things, prevent cross-subsidies -- but which destabilized the meaning of the term "cross-subsidies" even more (pp. 179-180). (Temin later notes that "cross-subsidies" eventually stood for all of the industry's problems with competition (p.244).) At about the same time, the FCC shifted its rationale from the goal of lower costs to the goal of competition for its own sake (p.195) -- a rationale under which AT&T's traditionally strong case for monopoly could not gain any more traction.

Finally, AT&T saw the writing on the wall. The case was not going well, the rationale of competition did not provide criteria under which it could win, and the best Brown could hope for was a divestiture that preserved AT&T's vertical structure. In December 1981, he asked the DoJ to write a modification of final judgment for the 1956 Final Judgment (Consent Decree) (p.269). Language from a Senate bill was spliced in, and the principals (ironically) negotiated extensively over the phone before coming up with an acceptable outline for divestiture (pp.271-272). Despite resistance from the judge trying the DoJ case, resulting in several compromises, the basic agreement held. AT&T divested seven RBOCs and repositioned them to function as competitors. Ironically, the divestiture broke the Bell System along board-to-board lines; despite the rejection of board-to-board theory in Smith v. Illinois Bell, it had prevailed in a rather material way (p.308).

Let me close by pointing out a few things that are really interesting to me.

First, abstract terms such as "universal service" and "cross-subsidies" are rearticulated multiple times. Tenin tries to hold "universal service" relatively steady and Mueller tried to hold "cross-subsidies" steady so that they could interrogate the other term. But both were in flux, and often it was unclear who if anyone had the authority to fix them. Even legislators and regulators had (or exercised) relatively little power over them.

Second, the fall of the Bell System seemed to be related to a sort of tipping point being reached in the legislative and regulative culture. The Bell System's monopoly status was saved first by World War II, then by the Cold War, because the infrastructure was seen as a public utility and the logic of public utilities is rationalization leading to broad services at low prices. In this sense I think Mueller is probably wrong to argue that the second articulation of universal service was made of whole cloth in the early 1970s. Temin makes a good case that this second articulation was an expression of AT&T's core values and reflects the logic of a public utility. But it was expressed in the 1970s to counteract the new logic of competition -- not for lower prices or better service or higher penetration rates, although all three were presumed to be natural results, but for its own sake. Once the warrant of efficiency through rationalization had been traded in for the warrant of competition, the organization could not prevail. AT&T's network, which was a material instantiation of the former argument, could not support the latter argument. I think Temin understands this to some extent, but he doesn't "get" it and he consequently clings to the notion that AT&T has been wronged.

Third, there's a tremendous amount of splicing going on in the legislative battles. Some of it is quite direct: the MFJ incorporated language directly from Senate bills, for instance. Some of it is material and underhanded, such as MCI's Execunet service. Some of it is more subtle, such as AT&T restructuring its sales organization along IBM's lines. Some of it is ridiculous, like the little plastic Hush-a-Phone cups that infected the network (in a regulative sense) and made interconnections possible. But in all of these cases, junctures (and often disjunctures) created the connections that would later develop in different ways, bringing in even more actors. When the definitions of "universal service" and "cross-subsidies" slipped, when they were reinterpreted by different actors in different activities, those changes became part of the regulative, legislative, and material and practical structure of the industry.

What a long review. Time to take a break from telecommunications and read an unrelated book!

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(Enconium on Sticky Notes)

Originally posted: Wed, 09 Feb 2005 19:03:30

I've been told that smart people use sticky notes for annotating their readings. Not sure if I really qualify, but I certainly use sticky notes for everything.

Part of the reason is the embarassing nature of the annotations I've seen in books I check out from the library. Recently I checked out Vygotsky's Thought and Language (2ed) and discovered copious notes in pencil. Bless his/her heart, the previous reader had written notes such as "is Vygotsky trendy right now because of his critique on Piaget?!?" Um, no.

The problem is that annotations -- for me, for this hapless author, and perhaps for others -- are a way to make sense of readings rather than a collection of pronouncements. The reviews I write on this blog are public writings, so I take a minimum of care in writing them and making them coherent. My annotations are spaces where I try out ideas, try to make connections, and look for recurrent themes in the book; they aren't especially coherent, they're often wide of the mark, and I often cringe when I read them a few months later. Do I want them to become a permanent part of the book? Surely not!

In addition to allowing me to cover my tracks, sticky notes do other things. They allow me to find my annotations at a glance. They let me prioritize my insights: I'll star the notes that I think are the best points or the strongest connections. I'll use different colors for different readings. (Right now I'm rereading Medvedev's The Formal Method of Literary Scholarship, this time with dialectics as a special emphasis, so my dialectics-related notes are in hot pink while my other notes are in a pale blue.) And if there's something that relates directly and immediately to a project, I orient the sticky note so that it protrudes from the bottom of the page rather than out the side. Sticky notes, as Clancy implies in her comments, can actually transform the book; as Deleuze and Guattari might put it, they striate the book in ways that let me get a better handle on it. And they've transformed my scholarship so much that I'm frankly not sure what I'd do without them. Keep a journal, maybe.

How do you take notes?>

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Reading :: A consumer viewpoint on Texas telephone utilities; report of the chairman

Originally posted: Tue, 08 Feb 2005 11:01:32

A consumer viewpoint on Texas telephone utilities; report of the chairman

Texas. Legislature. Senate. Interim Committee on Public Utility Commissions.

Tracking down the term "universal service" just keeps leading to more and more interesting things. Did you know that Texas was the last state in the U.S. to establish a public utilities commission? Yes indeed. Here it is in black and white, in this interim committee report from 1971. The same year that brought us Led Zeppelin's fourth album also brought these sharp words:

Texas is the only state without a public utilities commission to regulate telephone services. We have, instead, a haphazard system of "local regulation" consisting of negotiations, often one-sided, between the telephone companies and nearly 900 city councils. (p.25)

The PUC, incidentally, was established in 1975. As a result of this report? I'm not sure yet. But it was sorely needed, because the burden borne by Texas citizens was heavier than that borne by the poor fellow on the front of Led Zeppelin IV.

The report continues:

Even if this system functioned with perfect efficiency, it would still leave unregulated two important aspects of telephone service:

(1) Monthly subscription charges in rural areas. No one, under our present system, has jurisdiction to set rates or insure high-quality service in unincorporated, rural areas. Residents of these areas do not even have the nominal protection of a city council to "bargain" with the utilities on their behalf. No governmental agency -- federal, state or local -- has the legal power to intervene and assist them in obtaining fair negotiations.

(2) Intrastate long distance rates. "Local regulation" in Texas extends only to local service in the incorporated areas; it does not -- and legally cannot -- extend to regulation by the city councils of the rates charged by Southwestern Bell for long distance calls made to other points in Texas. The Federal Communications Commission regulates all interstate calls, and in every other state, a state commission does the same for intrastate calls. In Texas, there is no regulation whatever of the rates Southwestern Bell may charge for intrastate calls. The company, indeed, refuses even to disclose its profits on such calls. They have refused to let any governmental body -- federal, state, or local -- see how much they make on this important aspect of their service. (p.25)

Amazing! Southwestern Bell was really allowed to run the table in Texas. Vast swathes of Texas were left entirely unregulated. And the regulated portions were regulated by municipalities, which had neither the information nor the financial resources to regulate telephone service in a thoroughgoing way. "Only Houston and Dallas make even a token effort at regulation. The smaller cities do not have the financial resources to hire the rate experts and attorneys necessary to argue their citizens' case against the numerous specialized, highly-paid telephone company representatives" (p.26). The report goes on to describe Nacogdoches' futile battle against the vast resources of Southwestern Bell (pp.26-27 and Appendix A), using it as a case study in favor of establishing a PUC.

The Nacogdoches case was an extreme illustration of the rate inflation that had dogged the entire state. Across Texas, "businesses are being burdened with intrastate leased-line charges that are between 200% and 400% higher per-mile than comparable interstate leased lines subject to F.C.C. regulation. The discrimination is obvious" (p.23). And the average monthly rates for consumers were higher in Texas than the national average -- across all sizes of telephone exchanges. "San Antonio, for example, has a monthly rate of $6.40, while San Diego, California, which has a comparable Primary Calling Area, enjoys a rate of only $4.90" (p.3).

Rates weren't the only problem. Rural service was poor. "The constable in the east Texas town of Zavalla reported that his patrol car's two-way radio frequently must serve as the only communications link for telephone subscribers whose equipment has broken down during the weekend" (p.23). And jurisdictional disputes between telephone companies resulted in problems for consumers. "This infighting among utility monopolies reached its most ludicrous extreme at the Ramada Inn in Nassau Bay, where a call from the barber shop to the front desk was a long distance, toll call" (p.23).

The report recommends, sensibly, that statewide regulation be introduced.

Prices and standards of service are regulated in most businesses by competition or the "law of the marketplace." When no such competition exists -- as in the case of most public utilities -- a monopoly situation is created. Government, which has created or preserves the monopoly, has a duty to protect the consumer by insuring that he is getting the service for which he pays. A monopoly per se is not hostile to the public interest; but an unregulated monopoly easily may be. (p.28)

Essentially, the committee is saying that a regulated monopoly becomes a de facto public utility. No more half measures -- Southwestern Bell had to be made to work in the public interest (p.29). This is true in large and small measures. One example the authors use is that of advertising space, which telephone companies routinely charged to their subscribers rather than their stockholders. "They have abused this privilege. Recently, for example, Southwestern Bell spent an undetermined amount of money to send its customers a recipe for 'Virginia Raisin Pie'" (p.30). Sure enough, the report includes a copy of the recipe, which is addressed to wives whose husbands have "a cravin' for raisins." Apparently this didn't fit under the committee's understanding of universal service.

One last thing. The committee suggested that the PUC include an opt-out option for each city and town. If a municipality preferred to regulate telephone service itself, their sovereignty trumped the PUC's authority. I'm interested in whether this provision made it into law.

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Reading :: The Evolution of Universal Service Policy in Texas

Originally posted: Mon, 07 Feb 2005 10:12:44

The Evolution of Universal Service in Texas: A Report

by Lyndon B Johnson School Of Public Affairs

As I've discussed at length elsewhere, in the telecommunications industry, universal service is a very slippery term. It meant radically different things at different times. Charting its evolution can teach us a lot about how the entire sociotechnical system evolved, I think. Since I'm analyzing data from a telecommunications company right now, I've become very interested in looking at some more local instantiations of universal service.

Some context: This 1995 report proceeded by a year the Telecommunications Act of 1996, which overhauled the Communications Act of 1934 to (among other things) set out specific requirements for universal service. What interested me in this report was that it discussed that chimeric term, universal service, as it was enacted in Texas in the years leading up to the Telecommunications Act of 1996. The report does repeat some commonly held and probably wrong notions about the origins of universal service, but it also provides a succinct summary of the history of telecommunications in the US.

And it provides a good breakdown of the current definition of universal service: "Two main features characterize universal service: availability and affordability" (p.26). That is, people should have service in their area and they should be able to pay for it. The first feature is defined in terms of "telephone penetration": the percentage of households with phone service (p.26). Telephone penetration was at 94.2% nationally and 91.5% in Texas in 1993. (Of those without access, 40% reported that they would like phone service but can't afford it (p.75).)

Affordability is measured by "a comparison of the annual average rise in the price for telephone service with the average price for all goods and services (represented by the consumer price index)" (p.27), and evidence suggests that telephone service has become more affordable. The authors credit this to the introduction of new technology, which has caused marginal costs to decline.

Beyond these two features, the authors identify three principles underlying universal service:

1. Equality of opportunity. The idea is that citizens must be able to communicate with each other to make reasoned political choices.

2. Quality of life. The telephone is a "lifeline" for disadvantaged segments of the population such as the elderly, poor, and disabled.

3. Economic efficiency. "The rationale underlying this argument is that people place more value on the telephone network the more people are connected to it. But individuals adn companies rarely have enough of an incentive to make sure that different networks are compatible and that complete strangers are hooked up" (p.27). (Compare this reasoning to Mueller's discussion of subscriber universes.)

The authors ask: "If telecommunications services are evolving, how should the notion of universal service evolve? There is no single solution to this puzzle, and as a result universal service has been defined in several different ways" (p.28). Right. Telecommunications services have grown increasingly heterogeneous, and Plain Old Telephone Service (POTS) is arguably no longer an adequate standard for universal service. If (for instance) voice mail or Internet connectivity is an overwhelmingly standard service, then denying it to a segment of consumers violates all three of the principles above. According to the authors, the Texas Public Utilities Commission listed the following as basic services: "voice-grade dial tone service, access to dual party relay service, access to local calling areas, tone dialing service, access to operator services, access to toll services, and access to 911 or enhanced 911 service as requested by local authorities" (p.29).

Universal service used to be funded by AT&T from its profits -- part of the price of being a regulated monopoly. But with its breakup, the universal service burden fell directly to subscribers, who pay a subscriber line charge (SLC), set at $3.50/month in 1995 (p.29).

Okay, this is all good background information. But what was unique about how Texas was implementing universal service in 1995?

Texas is unique in that it has a Universal Service Fund (USF), which is financed by all telecommunications utilities in the state based on toll usage of the telephone network. The USF pays for the Tel-Assistance discount and the Dual-Party Relay Service, a program that allows hearing- and speech-impaired Texans to communicate through specifically trained operators. The fund also covers the costs of the Department of Human Services and the PUC, in addition to any other costs that are necessary to administer the fund. The discount provided under the more recently established Lifeline program is absorbed by the local exchange companies and not the Universal Service Fund. Total monthly gross USF assessments have recently averaged close to $500,000.

More recently, the Texas legislature has included a provision in the Public Utility Regulatory Act of 1995 to allow the PUC to establish rules to expand the USF for local exchange companies that serve fewer than a million access lines. ... The measure also strengthens the eligibility that local exchange companies (LECs) must meet, requiring LECs to offer service to every consumer within its cetified area and render continuous and adequate service within the area or areas. In addition, the pending legislation includes the proposal to establish a Telecommunications Infrastructure Fund. This $75 million fund will be administered by a nine-member board and financed by telecommunications providers. The board will award loans and provide necessary equipment and infrastructure to promote telecommunications services that the board finds are directly related to a distance-learning activity that is or could be conducted by an educational institution in Texas. (pp.30-31)

If these paragraphs seem a little thick to you, read them again, this time asking yourself: how does the concept of universal service get translated into actual policy? The answer is breathtaking. Universal service, which started out as the principle of interconnecting competing networks to form a single subscriber universe, had changed so much that by 1995 it required an increasingly lengthening laundry list of initiatives, agencies, charges, acts, and funds. And since the latest definition of universal service made it a moving target, we can expect to see these multiply in the future. The more telecommunications companies innovate, the more their innovations are likely to become standard, thus basic, and thus the more likely they are to come under the purview of the PUC. What a great illustration of what actor-network theorists like to argue: the inseparability of the social and the technical -- in this case, the technological innovations meant to attract new subscribers, which eventually translate in a fairly direct way into new regulative and legislative activities.

The report also discusses the history of Texas telecommunications regulation:

Before the mid-1970s, the State of Texas did not formally provide guidance or oversight over the telecommunications industry. Private utilities were unregulated by the state. In 1975, the Texas Legislature created the Public Utilities Commission. The PUC has had regulatory authority over telecommunications utilities in Texas since this creation. The PUC sets rates for all local exchange companies (LECs). The PUC regulates in accordance with the Public Utility Regulatory Act (PURA). Traditionally, PURA has required that telephone rates be dependent upon a rate-of-return scheme. This scheme provides for quarterly PUC monitoring of LEC earnings. LEC rates are then based on the cost of providing service. LECs are allowed a rate of return, or earning, based on this estimated cost. (p.44)

If memory serves, Texas was the last state in the nation to establish a PUC. (I'll have to check that.) Anyway, the PUC explicitly adopted universal service as a policy goal in 1995 (p.47), using similar language and essentially the same principles discussed earlier in the report. What interests me is how Texas handled universal service earlier, and I don't think the report is entirely clear on that point. How did the term become introduced and how did it evolve?

>

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Reading :: Universal service obligations in a competitive telecommunications environment

Originally posted: Mon, 07 Feb 2005 23:41:32

Universal service obligations in a competitive telecommunications environment

by Patrick Xavier

Continuing my investigation of the slippery term universal service (see my review of Muller's Universal Service), I skimmed this thin monograph on universal service policy. The monograph was published in France by the Organisation for Economic Co-operation and Development -- an indication, I hasten to note, of how broadly the term "universal service" has traveled. Bear in mind that the term originated in a 1907 AT&T annual report as a way of articulating the company's new strategy for crushing its competition. So it's fascinating to see that the term has been translated (in Latour's sense) across the Atlantic and Pacific into "non-commercial objectives" (p.13)!

What are these objectives?

The so-called 'Universal Service Obligations' of telecommunication operators, which has been a common feature of telecommunication regulation in most countries, is an example of such a requirement. Usually these obligations constitute a requirement to provide basic telephone service to all who request it at a uniform and affordable price even though there may be significant differences in the costs of supply. (p.13)

Individual countries pursue additional means to provide universal service, and these means are by no means identical (pp. 13-14). In any case, however, the author notes that universal service has traditionally been maintained by cross-subsidies (e.g., keeping local costs low by charging more for long distance costs). But "recent rapid changes in telecommunication technology and policy which has liberalised markets in an increasing number of countries have given rise to concerns about the sustainability of universal service policies based on cross-subsidisation" (p.14). No kidding. When cross-subsidies support universal service by borrowing from other segments, competition in those segments will destroy cross-subsidies by charging market rates rather than inflated rates (pp.14-15). So countries that attempt to offer universal service are caught in a bind. If they liberalize markets and continue to finance universal service through cross-subsidies, they risk the cratering of the whole enterprise. But if they impede competition, they give up all the benefits that come with it -- and "since competition can yield significant benefits for at least some aspects of universal service, prohibiting competition could serve, in fact, to impede progress toward universal service" (p.15). The author goes on to advocate competition rather than monopoly, as long as "appropriate arrangements" are in place (p.15).

Let's skip forward to some interesting discussion. I've noted elsewhere that universal service is a moving target, certainly in the United States. Universal service refers to basic telephone service, but the definition of "basic" changes based on what features are widely available. In Texas, for instance, basic service encompasses "plain old telephone service" (POTS), but also other services such as 911 and relay services, and regulations state that the definition can expand in the future. But this monograph points out that in certain cases and along certain dimensions, the definition of universal service has narrowed:

In some instances, the contraction of the basic service definition has occurred largely at the instigation of the telephone companies as a means of creating revenue. The introduction of separate charges for operator services, directory assistance, special number assignment, and time-measured charges for local calling fall within this category. In other instances, the contraction of the basic service definition happened in connection with changes in regulatory policy. The unbundling of customer premises equipment and inside wire (both investment and maintenance components) from basic services are examples of this latter case. (p.28)

On the same page, the author thoughtfully includes a table showing the components of basic service in the US from the 1900s to the 1990s.

Later on, the author notes that BellSouth decided to declare victory on universal service in the 1990s. Citing the industry's 93% penetration rate nationwide, it argued that universal service had been accomplished and "argued that the remaining households fail to subscribe by choice, not due to a lack of availability" (p.39).

This policy monograph can be dry at times, but for me, it's fascinating to see how the term "universal service" has evolved over time and become articulated in so many different contexts. >

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Reading :: Universal Service

Originally posted: Fri, 04 Feb 2005 23:27:26

Universal Service : Competition, Interconnection and Monopoly in the Making of the American Telephone System

by Milton L. Mueller Jr.

Bruno Latour likes to point to examples of translation, in which a term or concept is put into play, is picked up by various actors, and facilitates political-rhetorical interconnections among them. In doing so, the term or concept gains strength, but it does so by losing some coherence or integrity. That is, the term or concept does what it does because it is in some senses a moving target: it has to keep changing in order to ally new actors, while appearing to remain the same.

I recently authored an article on the translation of the term prototyping as it made its way from Scandinavia to North America. (It'll be in TCQ later this year.) But another really striking example is that of universal service, a term that has been used in US telecommunications since the late 1800s but that has meant demonstrably different things. Milton L. Mueller has written a fascinating history of the term. Mueller's not a scholar of the rhetoric of technology -- that is, he doesn't use theories and theorists from that interdisciplinary subfield variously known as "studies of scientific knowledge," "the rhetoric of science and technology," or "the sociology of science." Consequently, he hasn't framed the historical discussion in terms of translation, and I think he misses some of the implications of his study. But nevertheless he does a very good job of tracing the changes in the term.

Mueller makes two basic claims:

1. Universal service, though it is portrayed anachronistically as the principle of providing affordable basic telecommunications services for all (i.e., 100% market penetration), began as a very different concept: the principle of interconnecting competing telephone networks.

2. The consequent misinterpretation of a universal service mandate has resulted in a suboptimal telecommunications system in which healthy competition has been hamstrung. True, vigorous competition among telecommunications companies would serve the public better.

The second point is a policy argument, and I won't evaluate it. The first point, however, is just fascinating from a rhetoric of technology perspective. Mueller gets it mostly right here, I think, but either doesn't understand or doesn't pursue the implications of the shift. To explain what I mean, let me give you a little background -- because this is really a fascinating story.

Phase 1: Universal service as the principle of interconnection

Mueller tells us:

Universal service entered the vocabulary of American telecommunications in 1907. The slogan "one system, one policy, universal service" was coined by Theodore Vail, president of AT&T, and propagated in the company's annual reports from 1907 to 1914. Its appearance came at the peak of a fierce struggle between the Bell System and thousands of independent telephone companies. The idea of universal service served as the linchpin of the Bell System's argument for transforming the telephone industry into a regulated monopoly. (p.4)

Alexander Graham Bell patented the telephone in 1876. Until the patent expired in 1894, the Bell System had an exclusive patent on telephony -- although rival systems cropped up continually, requiring Bell to take continuous patent action. The problem was that on the one hand the technology was very useful and not difficult to manufacture, and on the other hand the infrastructure was relatively difficult to erect. Bell couldn't be everywhere. When the patent expired, an independent telephone movement sprang up almost immediately, in many cases retaining the names of the abortive companies that had been earlier shut down by patent action (p.43; 35). The companies decided to pursue separate, closed systems (p.43), each of which had its own subscriber universe (pp.59-60). The value was perceived to be in the subscriber universe itself -- you bought a brand of phone service because of the other people already on that system. If Person A wasn't on a given system, you couldn't reach them from your own system. (Imagine that your Sprint phone only let you talk to other people with Sprint phones. It's the Friends and Family plan from Hell.)

Consequently, a subscriber in a densely penetrated area might subscribe to two or more networks in order to reach everyone he needed to. I say "he" here because the main target of telephone service in those days was businessmen (p.40). Home phones were rare, so rare that when the 3% temporary Federal Excise Tax was levied on telephone service in 1898 to raise revenue for the Spanish-American War, it was considered a luxury tax. (The war lasted six months, but the Federal Excise Tax is still with us, and it's no longer a luxury tax.) The systems were not only separate, they weren't even colocated: if your business had service with three companies, you had three sets of phone lines coming into your business.

Naturally, the Bell system left vast areas unserved, concentrating on high-density areas and the long-distance service in between. The local exchanges were served by operating companies that Bell licensed when its patents were still enforceable; the licenses bound the operating companies to terms that lasted far beyond the life of the patent. That left Bell the ability to construct long-distance service. And if a licensee tried to break away from the Bell system, Bell could isolate it -- cut off connections to the outside world (pp.38-39).

This setup, however, left competition opportunities for local exchanges, and companies sprang up to fill the gaps. They began building infrastructure particularly in rural areas, and they began forming interconnection agreements with each other in opposition to Bell. In rural areas where not even the independents would go, farmers would set up party lines to keep their communities connected. Soon telephone service became desirable for homes as well as businesses. And the competition began to hurt Bell.

Why was the problem so intractable? Mueller says it was because the principle of economies of scale did not apply. It seems that the more subscribers your company has, the more efficient the overall system will be. Yes, you can achieve economies of density that way -- it is indeed more profitable to serve more subscribers in a high-density urban area (p. 17). But a more general economy of scope or scale doesn't apply because each connection is a distinct service (p.32). The more subscribers you have, the higher your costs mount: you need to erect more poles, string more cable, wire more exchanges, troubleshoot more lines, trim more overhanging branches, hire and manage more operators (particularly in the days before automated switching). Many independents failed to grasp this: they would start by offering service at costs lower than Bell's, they would rapidly expand their subscriber base, and then they would go out of business as they raised their rates to compensate.

The value of telephone service in those early days was not in its rates, then, but in the stable subscriber universe that a service could provide. Bell and the independents both resisted interconnection because it could destroy this advantage (p.51). Instead, they competed to pull subscribers into their own subscriber universes, using leverage such as the strategic shapes of their networks (cf. Hughes).

So what happened to move both parties to interconnection -- that is, to the original sense of universal service, in which any telephone user could reach any other? Mueller says that

the networks competed on the basis of their scope, or the size of their bundle of access units. That kind of competition gave the networks strong incentives to tap new user groups, enter undeveloped areas, lower access prices, and interconnect with noncompeting networks. Caught up in this dynamic, Bell and the independents were propelled into a race to achieve universality. The dramatic expansion of telephone service did not occur because of altruistic motives, grand social visions, or governmental policy, but was literally forced onto the contestants by the dynamics of access competition. (p.54)

Bell had built a nationwide network, but it was a network primarily in and between high-density areas serving businesses. (Remember Bowker's observation that a network is thrown over large areas of space; the interstices simply don't matter. In this case, competitors had made sure that Bell's interstices did matter.) So in its pursuit of national service, Bell had developed in geographically uneven ways, and left gaps in local and regional telecommunications (p.57). Soon Bell had to start filling in those gaps, penetrating markets that the independents already served. From 1898-1907, dual service expanded into the most rural areas: Bell and the independents began to overlap with more and more frequency, and Bell began interconnecting more frequently with noncompeting independents (p.60). At the same time, independents tried to make inroads in areas that had traditionally been Bell's territory (p.60).

"As the other tactics failed," Mueller tells us,

Bell managers saw that its own underdevelopment was the root of the problem of independent competition. Increasingly, they understood that Bell's main competitive advantage was its ability to offer comprehensive service within a given region. Although independent exchanges and telephones often outnumbered Bell in a given territory, Bell still had more exchanges than any individual independent company. With its coordinated business management and superior access to capital, it was in a better position than the independents to expand, interconnect, and integrate the operations of many dispersed exchanges. In effect, Bell began to try to beat the independents at their own game. The "opposition" had bested the Bell System by offering access to a larger number of local and regional points. Now Bell would expand and integrate its operations so that it could offer its customers an even larger bundle of regional connections than the independents. (p.71)

So in the new strategy, "the real source of competitive advantage was comprehensive coverage of a particular region corresponding to the interest of a majority of telephone users. ... the best way to satisfy all possible users was to create a comprehensive, universal network" (p.72). Mueller doesn't quite say: the physical network is an argument, one that worked in a way that previous arguments did not. This notion of universal service was a new argument, a new logic, that turned the old enterprise logic of restricted subscriber universes on its head. More effective than rate cuts, court challenges, strategic service offerings, or advertising, the new argument won out.

It was a little more complicated than that, of course. Local exchange access was still terrifically expensive due to the fact that every connection is a separate service. To deal with this problem, Bell began subsidizing local service through higher long distance rates -- something that it could do, since long distance service was a premium service used by businesses rather than home users, and since Bell still had the best developed long distance infrastructure thanks to its longstanding strategy of becoming a national telecommunications provider. These cross-subsidies blunted the cost of local service and gave Bell enough advantage to expand (p.74). Bell also began to sublicense more frequently and interconnect with more noncompeting independents (p.76).

And finally, in 1907, we hear Theodore Vail beginning to promote the idea of "one system, one policy, universal service" (p.96). Universal service was opposed to dual service, the old logic of nonconnecting, competing telephone services (p.92). As Vail articulated it, universal service was a coherent business strategy -- not a temporary ploy for advantage, nor an altruistic vision of ideal service (pp. 96-97). It had four components:

- Network externality. "The value of telephone service grew as the number of subscribers grew." And "his emphasis on the value of unfragmented telephone access reveals a profound understanding of the growing interdependence and impersonality of industrial society" (p.97) -- a condition that still holds today, with some changes.

- Centralization of control. "Universal intercommunication required centralized control and coordination. Service should be provided by, or under the control of, a single firm" (p.98). This condition, arguably, does not hold today.

- The imperfection of competition in telephony. "Competition between telephone networks is always imperfect competition" (p.99). That is, separate networks will always be heterogeneous: they will always offer some significant difference in quality or features. "Consequently, competition requires either a duplicate subscription ... or restricted access" (p.99). Today this doesn't hold: even when using the same physical network, companies offer a heterogeneous slate of services (ex: SBC's Call Notes, which is essentially a voice mail system for local users).

- Regulation as the alternative to competition. Vail made clear that he would accept government regulation of rates and services in exchange for a private monopoly (pp.99-100).

"What set the Bell policy apart," Mueller summarizes,

was its commitment to interconnect all telephone users into one big, centrally managed, nationally integrated system. The real debate was between competition and monopoly, between unification and fragmentation. Vail's doctrine of universal service represented an extremely powerful case for the latter. (p.101)

In the wake of the articulation of this policy, Bell liberalized its policy on interconnecting with other telecommunications companies. And the result worked. Municipalities felt the contradiction between the desire to maintain competition on one hand and the impulse to unify the system on the other (p.114). Interconnection, which in theory favored independents by giving them access to the vast Bell system, in fact destroyed them (p.117). As Bell's network became longer and stronger, it walked the knife edge, trying to provide universal service as a regulated monopoly while evading government ownership (p.129). The result was the Kingsbury Commitment of 1913, which AT&T used to forestall the application of the Sherman Antitrust Act. The Kingsbury Commitment is widely seen as a landmark, but Mueller says it's merely a feint: "the commitment had no impact whatsoever on toll interconnection" (p.130). Whatever it was, it kept antitrust activity from AT&T as it consolidated its new position as provider of universal service. Mueller adds that AT&T didn't accomplish this in the face of fierce opposition: in fact, the voters, city councils, and statewide referenda wanted universal service rather than dual service; they preferred a regulated monopoly (p.134). The new enterprise logic had proven to be a successful argument. And by the mid-1920s, universal service had been achieved -- in its original meaning, that is (p.150).

Phase 2: Universal service as total market penetration

Then Bell settled into a long life as a regulated monopoly. Bell didn't allow any non-Bell equipment to attach to its network, a policy so draconian that even the Hush-a-Phone -- a plastic cup that attached to the receiver to keep conversations quiet in busy offices -- was considered a threat to network integrity. (AT&T finally lost the Hush-a-Phone case in the DC Appelate court in 1956, and it did in fact become a threat to AT&T's network, since it lay the groundwork for attaching fax machines, answering machines, and other devices to the network.) But that monopoly was threatened in the 1970s, due to a strategic business decision that AT&T had made before Vail ever articulated the principle of universal service.

AT&T had blunted the high costs of local service by cross-subsidizing it through revenues from the long-distance side. As long as AT&T controlled long distance, this arrangement worked brilliantly. But in 1959, Microwave Communications, Inc (MCI) began offering new long distance services. And these services severely undercut AT&T's prices because the independent long distance companies had no incentive to levy the charges that AT&T had to levy in order to cross-subsidize local service. Their long distance connected directly to Bell's subsidized local service. With long distance competition, Bell's advantage in local service was translated into a severe disadvantage.

So Bell had to do some translating too. By the early 1970s, AT&T's representatives and advocates had reinterpreted universal service as the obligation to provide basic telephone service to as many people as possible (i.e., complete market penetration) -- and reinterpreted cross-subsidies as a way to keep local service low so that this altruistic goal could be achieved. The preamble of the Communications Act of 1934 -- which had nothing to do with either definition of universal service -- was anachronistically represented as the origin of the concept (p.164). Mueller puts it forcefully:

During the crisis of the Bell System in the mid-1970s, universal service was redefined as an industry-government commitment to put a telephone in every home. That second-generation universal service policy invented a mandate from the 1934 Communications Act and claimed credit for making telephone service available and affordable to nearly all Americans. Both claims, as we have seen, are myths. (p.166)

As a way to preserve the monopoly, the gambit failed: AT&T was broken up as a result of the Modified Final Judgment in the government's antitrust case against AT&T (1982). But at the same time, the translation of universal service took hold, picked up and embraced by lawmakers and citizens alike. "Although AT&T's political objectives did eventually fail, its historical revisionism was an overwhelming success" (p.164). A success, however, without any solid legal backing. Until the next translation.

Phase 3: Universal service as universally obtainable slates of services

"In a weirdly posthumous political victory, the mythology of universal service created by the old order had become the law of the land" (p.166). The second articulation of universal service was picked up and enshrined in the Telecommunications Act of 1996, "clearly articulated" (p.167), and made concrete enough that regulations could be based on it. It was operationalized in Section 254, Subsection b. But in this third phase, universal service expanded even beyond the definition that AT&T had articulated in the 1970s:

The language makes it clear that universal service obligations need no longer be confined to traditional telephone service. Universal service is to be an "evolving level of telecommunications services," and the definition must take into account advances in telecommunications and information technology. The FCC must include, at a minimum, any telecommunications service to which a substantial majority of residential customers subscribe. It must also revise and update the definition periodically. (p.167)

Notice that this destabilizes the industry significantly. In the old days, telephone service was relatively homogeneous. Quality and subscriber universe might vary, but the basic service was the same in any network: voice telephony (p.173). Today, you can choose from a wide slate of services, including call waiting, caller ID, dial-up Internet, ISDN, DSL, voicemail, and on and on. Rival companies regularly roll out new services as a way to keep ahead of competitors. The Telecommunications Act of 1996 essentially says that any of these services can be considered part of basic service once they achieve a certain level of market penetration. A telecomm company has to keep up with competitors, not just because of market pressures, but because it has to be prepared for popular features to be mandated. Services can't be unbundled; rival networks can't pursue niche markets wholeheartedly. (Some of the current debate over the classification of internet services has a lot to do with how this law should be applied to those cases.)

Beyond this requirement, telecommunications companies must provide "quality services" at "just, reasonable, and affordable rates" (p.167). Affordability was a post-hoc rationale, Mueller reminds us, which was "enshrined" in law (p.168).

Finally, we see some really interesting fallout of this articulation in the current state of telecommunications. Since interconnection is mandated by law, no company can gain competitive advantage by being a bottleneck for local service (p.177). Local exchange carriers cannot prohibit or limit the resale of their services (p.178). Interconnection has to be open and nondiscriminatory (pp. 178-179), resulting in service that is transparent -- when you pick up a phone, your service will be the same no matter what company (or companies) effect the call. (This makes "slamming" possible: the illegal practice of switching a consumer's telephone service without her knowledge. "Slamming" is usually detected only when the new bill comes in.) Most importantly, the new articulation of universal service requires deep interconnections and interpenetrations among rival companies. In the current environment, workers at telecommunications companies are mostly massed at the company's borders, working closely with their counterparts in other companies; the integrity of the boundaries between companies is not strong.

I've gone over several points in Mueller's book, which is very good. But I can't seem to summon the sense of indignation that he has. That's largely because these sorts of translations are to be expected, and they happen more broadly and gradually than he sometimes presents them. For instance, yes, the Telecommunications Act of 1996 enshrines a version of universal service in law. But that meaning was already being enacted in state laws. For instance, Texas articulated universal service as a policy goal in 1993, based on even earlier policy actions. The translation worked because of a general shift in the perception of telecommunications services; it was not just an anachronistic concept that took on a life of its own, it was an evolving argument.

Despite some slow spots, this is a fascinating book. If you're at all interested in the telecommunications industry, or if you have a lay knowledge and interest in the rhetoric of technology, check it out.

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Reading :: Dialectics of Nature

Originally posted: Thu, 27 Jan 2005 20:55:22

Dialectics of Nature

by Frederick Engels

I didn't actually read through this book -- I skimmed it, trying to make sense of dialectics as Vygotsky received it, and Engels was a good place to start because Vygotsky cited him more than Marx. (This is part of my research for an upcoming presentation in March.) Skimming usually makes me feel guilty, but in this case I don't, since Dialectics of Nature is not a proper book in the first place. It's put together from unfinished manuscripts that Engels left behind when he died. Engels had been planning on developing the manuscripts into a book, but on Marx's death, he decided to put that project aside in order to prepare Marx's unfinished work for publication. Judging from this book, that was probably a good move. Engels was -- how do I say this? -- definitely the junior partner in that partnership. Dialectics of Nature is impetuous, full of revolutionary fervor, and given to sweeping statements. I can see how Vygotsky, a more careful thinker, leveraged these raw ideas and modulated them appropriately to come up with an account of psychological development.

Engels argued that dialectics, once they are made materialist rather than idealist, constitute a general law of nature. For him, dialectics is the "science of interconnections"

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Reading :: Critical Transition from Developers to Users

Originally posted: Fri, 21 Jan 2005 10:00:03

Critical Transition from Developers to Users: Activity-Theoretical Studies of Interaction and Learning in the Innovation Process

By Mervi Hasu

Mervi Hasu is a researcher and project manager at the Center for Activity Theory and Developmental Work Research at the University of Helsinki. This seems like a terribly interesting job to me. And I really can't get over how friendly and cheerful she looks. Really! She appears to be ready to spring off the webpage, shake your hand, and introduce herself. And I imagine she would have terribly interesting things to say.

I can make that statement with some certainty since I have read two of her previous articles, and they were fascinating. It turns out that those articles were based on her dissertation project, Critical Transition from Developers to Users. This dissertation is an 84-page "wrapper" for four articles the author wrote singly and in collaboration with others: her director, Reijo Miettinen, and Yrjo Engestrom. That is to say, it provides a literature review, discusses methodology and methods, and summarizes findings, but the articles themselves contain the cases. The articles are:

• Miettinen, R. and Hasu, M. (2002). Articulating user needs in collaborative design: Towards an activity-theoretical approach. Computer Supported Cooperative Work, 11:129?151.
• Hasu, M. & Engeström, Y. (2000). Measurement in action: An activitytheoretical perspective on producer-user interaction. International Journal of Human-Computer Studies, 53, 61-89.
• Hasu, M. (2000). Constructing clinical use: An activity-theoretical perspective on implementing new technology. Technology Analysis & Strategic Management, 12, 369-382.
• Hasu, M. (2000). Blind men and the elephant: Implementation of a new artifact as an expansive possibility. Outlines, 2, 5-41.

I've read the two collaborative articles and they're quite good. The dissertation is good too, though not as interesting as the cases are. Partially that's because one of the most interesting ideas from my perspective -- activity networks -- is only hinted at rather than discussed in any detail. The notion is developed more fully in the Miettinen and Hasu article, but not enough to satisfy my curiosity. I've complained elsewhere (in a book chapter currently in press) that activity theory tends to treat activity networks as "pipelines" in which the outputs of one activity become the inputs of another, neatly separating the activities even as researchers talk about these activities "interpenetrating." Miettinen and Hasu avoid the simplest version of this problem, but they don't treat the problem as well as they might. Figure 2 (p.135 of the article) even connects little triangles in what for all the world looks like a schematic or flowchart. Activity systems have traditionally been portrayed as undergoing contradictions that, at some point, become so unbearable that the activity collapses or transforms itself -- and one of the best studied types of contradictions is between activity systems -- so it's not surprising that Hasu takes this tack: "Typically, a pair of activity systems ? that of the developers and that of the users interacting in a situation - was chosen for more detailed analysis" (p.57 of the dissertation). This is too bad, since contradictions and pipelines are certainly not the only ways that human activities meet. I'm sure the activity network concept will develop further to better address the problem, under the pressure of actor-network theory and related approaches.

Back to the dissertation. Let me hit some of the highlights here. Hasu is at her best when discussing an activity-theoretical understanding of innovation. She draws heavily, as most people in this line of scholarship do, on Yrjo Engestrom. Engestrom is the author of Learning by Expanding (reviewed elsewhere on this site), and Hasu borrows from the notion of LBE to discuss innovation:

I will suggest an additional or complementary view on learning in innovation, according to which it is seen as a purposive activity carried out in order to recognize and proactively direct and develop the organization?s capabilities for mastering transitions, or the emerging trajectories and challenges of innovative activity. If transitions are essential, how can organizations better achieve a sense of recognition for them? How is the need for learning during a transitional stage recognized and mutually understood? I will suggest that research on learning and organizational change within activity theory and developmental work research (e.g., Engeström, 1987; Cole & Engeström; 1993) provides concepts and methodological ideas for the necessary new view of learning in innovation. (p.46)

Hasu nicely frames the problem here, and I particularly like the phrasing "emerging trajectories and challenges." When Hasu talks about innovation, she means technological change (her case is that of a neuromagnetometer under development for hospital use). This is related to the problem of ad hoc innovations that I've studied, but it's different in that these products are made to endure and to circulate into other activities. Hasu argues that activity theory provides an ideal framework for explaining how. Its studies

"involve the deliberate tracing and visualizing of disturbances and breakdowns in everyday work practices in order to create a sense of pressing developmental contradiction within the activity and to enlarge or reformulate ? expand - work practices. (p.48)

Notice that Hasu adheres to the notion of breakdowns as symptoms of contradictions. I've argued against this notion in my book, and I persist in thinking that it's a bad idea to assign one level of activity a necessarily causal role. But it's a natural assumption, one that I made in my own dissertation. In any case, Hasu uses the notion of contradictions to explain innovation:

As contradictions of an activity system are aggravated, some individual participants begin to question and deviate from its established norms. In some cases, this escalates into collaborative envisioning and a deliberate collective change effort from below (Engeström, 2000b).

Engeström (1987) proposed this as a historically new form of learning: expansive learning of cultural patterns of activity that are not yet there. An expansive transformation is accomplished when the object and motive of the activity are re-conceptualized to embrace a radically wider horizon of possibilities than in the previous mode. Engeström (2000b) suggests that expansion involves horizontal or sideways learning and development. I further suggest that the notion of expansive learning is also relevant for understanding - and possibly in better mastering ? the challenges of critical transitions within the innovation process. (p.49).

This is a nice summary of learning by expanding, and it prepares us for the study's design. Hasu conducted an "ethnography case study" in which she observed the machine's use, interviewed its users and designers, and examined artifacts associated with it in different contexts. As one might expect, she observes that

Transitions are seen as inherently contradictory. From an activity-theoretical perspective, transition from one activity to the next involves participation in a new or emerging activity along with engagement in the previous one. It is assumed, therefore, that the transitional phase of the innovation examined in the present study does not take place without problems. It is also assumed that the transition constitutes a major challenge for the innovation network which was formerly oriented to the development of specific technology and basic research. (p.57)

I very much enjoyed reading this dissertation, but it really is a "wrapper" from my perspective -- I found that the really important and interesting work, theoretical as well as empirical and methodological, happened in the articles. So now I look forward to reading those remaining two articles.

(Reading Roundup: Harding and Others on Research Terminology)

Originally posted: Sun, 16 Jan 2005 04:47:05

I've been reading a lot about research approaches, both for my own work and for the qualitative research class I'm about to teach. What has struck me lately is how much slippage there seems to be among terms commonly used in discussing research: methodology, method, technique, paradigm, epistemology, etc.

To see how others have straightened these terms out, I've gone back to Sandra Harding's classic essay "Introduction: Is there a feminist method?" and looked at her taxonomy. Here are a few quotes from her, along with my comments.

"One reason it is difficult to find a satisfactory answer to questions about a distinctive feminist method is that discussions of method (techniques for gathering evidence) and methodology (a theory and analysis of how research should proceed) have been intertwined with each other and with epistemological issues (issues about an adequate theory of knowledge or justificatory strategy) in both the traditional and feminist discourses. This chain is a complex one and we shall sort out its components. But the point here is simply that 'method' is often used to refer to all three aspects of research. Consequently, it is not at all clear what one is supposed to be looking for when trying to identify a distinctive 'feminist method of research.'" (p.2)

Comment: It may be useful to conceptually separate these aspects, but in practice they are intertwined and considerable slippage occurs. Notice that Harding equates method with technique, but it's clear in the following paragraph that she is talking about technique in a very general way (e.g., interviews) rather than very specifically (e.g., structured interviews; contextual inquiry). Others have separated method and technique, which after all have very different etymologies (methodos, techne); see my "Lost in the Translation" (in press, Technical Communication Quarterly) for a couple of examples. Also see Long et al. (2000) and Kensing (1998) for discussions of technique that separate it from method.

"A research method is a technique for (or way of proceeding in) gathering evidence. One can reasonably argue that all evidence-gathering techniques fall into one of the following three categories: listening to (or interrogating) informants, observing behavior, or examining historical traces and records. In this sense, there are only three methods of social inquiry." (p.2)

Comment: Again, method is technique in so general a sense that we might as well separate it from technique. See also Chin's piece in Smagorinsky's edited collection Speaking About Writing : Reflections on Research Methodology, where she calls interviewing a method.

"A methodology is a theory and analysis of how research does or should proceed; it includes accounts of how 'the general structure of theory finds its application in particular scientific disciplines.'" (p.3)

Comment: The quote is from Peter Caws, "Scientific Method" in The Encyclopedia of Philosophy (1967).

"An epistemology is a theory of knowledge. It answers questions about who can be a 'knower' (can women?); what tests beliefs must pass in order to be legitimated as knowledge (only tests against men's experiences and observations?); what kinds of things can be known (can 'subjective truths' count as knowledge?), and so forth. (p.3)

Comment: Harding leaves out a lot here. Creswell, in contrast, identifies five different axes of philosophical assumptions that together constitute a paradigm framework: epistemological, axiological, ontological, rhetorical, and methodological. Another source says that the paradigm framework is made up of philosophy, ontology, epistemology, and methodology.

John Law does a good job of questioning these separations, drawing on Deleuze and Guattari to describe a "method assemblage" in which all parts continuously reconfigure the others. Sullivan and Porter, endorsing Harding's general scheme, criticize "the traditional distinction between methodology-as-theory-codifying and method-as-application-of-methodology." In their taxonomy, praxis is problematized method. Methodology and research questions shift as the situation affects the unfolding method (p.66).

Works cited

Creswell, J. W. (1997). Qualitative inquiry and research design: Choosing among five traditions. SAGE Publications.

Deleuze, G. and Guattari, F. (1988). A thousand plateaus: Capitalism and schizophrenia. Athlone Press, London.

Harding, S. (1987). Introduction: Is there a feminist method? In Harding, S., editor, Feminism and methodology, pages 1?14. Indiana University Press, Bloomington.

Kensing, F. (1998). Prompted reflections: a technique for understanding complex work. interactions, 5(1):7?15.

Law, J. (2004). After method: Mess in social science research. Routledge, New York.

Long, R. G., White, M. C., Friedman, W. H., and Brazeal, D. V. (2000). The ?qualitative? versus ?quantitative? research debate: A question of metaphorical assumptions? International Journal of Value-Based Management, 13(2):189?197.

Smagorinsky, P., editor. (1994). Speaking about writing: Reflections on research methodology. Sage Publications, Thousand Oaks, CA.

Spinuzzi, C. (2005). Lost in the translation: Shifting claims in the migration of a research technique. Technical Communication Quarterly, 14(4).

Sullivan, P. and Porter, J. E. (1997). Opening spaces: Writing technologies and critical research practices. Ablex Pub. Corp., Greenwich, CT.

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Reading :: Storytelling in Organizations

Originally posted: Tue, 11 Jan 2005 19:48:58

Storytelling in Organizations : Why Storytelling Is Transforming 21st Century Organizations and Management

by John Seely Brown, Stephen Denning, Katalina Groh, Laurence Prusak

Amazon.com emails me periodically with book suggestions based on my past purchases. This suggestion sounded particularly interesting, based partially on the subject matter and partially on the lead author. John Seely Brown is, of course, the visionary former director of Xerox Research. The other authors are less familiar to me but similarly placed: Stephen Denning is the former Program Director for Knowledge Management at the World Bank; Katalina Groh writes, produces, and directs independent films and documentaries; and Laurence Prusak was with IBM Global Services. All but Groh are now independent consultants. Three guesses what they consult on.

The book is categorized as "Business/Management," and that's appropriate, since the book reads like others in that genre. It's frequently lighter than air, telling breezy stories about storytelling, and I often found myself wanting it to be more concrete and assertive about techniques, findings, etc. Citations are almost nonexistent, and the authors evidently have very different ideas and approaches to narrative. The lack of unity and detail has to do with where these chapters originated: the four authors originally delivered them as talks under the auspices of the Smithsonian Associates in 2001. Each chapter ends with a reflective section in which the author revisits the talk in 2004. As a result, we get a very brief and general overview of each author's version of storytelling circa 2001, with an even briefer and more general reflection of how their understanding has changed since then. It's a lazy way to put together a book. Since the authors all have an interest in promoting their own ideas on stories -- rather than coming up with a coherent, er, story -- the book seemed more like a promotional tract for the authors' other books and films and consulting services. Again, it fits into "Business/Management" rather than more substantial scholarly, philosophical, or methodological work.

Nevertheless, that promotional work is an important service in that it lets us know what takes are out there, what resources we can consult, and how stories are being used in organizations (generally speaking). And it's a quick read. If this book had maintained the general, promotional tone through 400 pages, I would have felt cheated; but at 178 pages, it is readable in a couple of sittings or in snatches between projects. It's useful as a brief introduction to narrative in organizations and could be paired with more substantial texts in an undergraduate class.

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Reading :: Activity, Consciousness, and Personality (supplemental notes on dialectic)

Originally posted: Tue, 04 Jan 2005 22:40:35
I've reviewed this book before, but I reread it with an emphasis on dialectical materialism, just as I have recently done with Vygotsky's books. Some fumbling observations:
First, Leontiev is writing considerably later than Vygotsky. Vygotsky's books were published in the 1930s; Leontiev's conclusion cites a journal from 1974. In the space of those four decades Soviet psychology had changed quite a bit due to the work of Leontiev, Luria, Rubenstein, etc. World War II, the Cold War, and the Stalinist years all happened. So it's a little surprising -- but on the other hand, perhaps not surprising at all -- that Leontiev is still working on many of the same problems and tying his work even more closely to Marx's and Engels' work. Take this passage from the introduction: "Here, however, we are concerned with something else: with the working out on a Marxist philosophical basis of the special problems of the methodology of psychology as a concrete science. This requires penetration into the 'internal economics,' so to speak, of theoretical thought" (p.3). This analogizing of psychology with economics is more than protective coloring for the censors, I think; it also suggests to me that Marxist psychology had trouble developing beyond Marx's original ideas.
Foremost among those ideas is dialectical materialism. Of that, Leontiev says: "Not only concepts but also our sensory representations are dialectical. For this reason they are capable of fulfilling a function that cannot be reduced to the role of set standard models corresponding to the effects received by receptors from isolated objects. Like the psychic image, representations exist insepearable from the subject's activity, and they fill it with the riches accumulated in them and make it alive and creative" (p.43). In case we don't get the message, in his conclusion he approvingly cites the English authors of the journal Cognition (1974): "The only alternative to reductionism is dialectic materialism." "This is actually so," he adds. "Scientific resolution of the problem, biological and psychological, psychological and social, is simply impossible outside the Marxist system of analysis" (p.142). Consequently, throughout the book we see the same sort of on-the-one-hand-on-the-other-hand, look-let's-put-the-hands-together (dialectical) reasoning that Vygotsky used throughout Thought and Language. For instance, on p.61, the distinction between internal and external activity is portrayed in these terms.
Clearly Vygotsky has had a deep impact on this work. In addition to the occasional cites, Leontiev uses concepts that seem genetically related to Vygotsky's. For instance: Thought and Language is still fresh on my mind, so when Leontiev says that "Human activity does not exist except in the form of action or a chain of actions" (p.64), I realized that there's quite a bit of similarity between Leontiev's three-level scheme of activity (operation-action-activity) and Vygotsky's discussion of complexes vs. concepts. Just as concepts are "higher" forms of thinking that provide unity at a level of abstraction and represent a higher level of development, actions are "higher" principles of goal-directed organization. Just as complexes can be in chains, so are operations essentially chains. Actions and operations might appear identical, but the difference is that one is goal-directed and the other is not, one is conscious and purposeful while the other is unconscious and reactionary, one is related to goals and the other is related to conditions (p. 65); compare to concepts vs. pseudoconcepts. And also compare these to Vygotsky's take on dialogue as a chain of reactions.
But Leontiev has developed this notion of developmental levels into a hierarchy and has also developed the notion of tool mediation quite a bit more. Here, I think Marx is his guide, as when he says that tools are "obviously" where methods and operations are crystallized, not goals or conditions (p.66).
Although Leontiev is keenly interested in tools, most of his work has to do with connecting individual and societal activity. Of this activity, he says, "The activity of man historically does not change its general structure, its 'macrostructure.' At all stages of historical development, it is realized by conscious actions in which a transition of goals into objective products is accomplished and which is subordinated to the modives that elicit it. What is radically changed is the character of the relationships that connect goals and motives of activity" (p.91). These relationships don't just form activity, they form consciousness. "Thus man's consciousness, like activity itself, is not additive. It is not a plane, nor even a volume, filled with images and processes. It is not connections of his separate 'units' but an internal movement of his formers, activities included in total movement realizing the real life of the individual in society. The activity of man makes up the substance of his consciousness" (p.95).
And here we get back to the dialectical reasoning that we see throughout much of the book. Leontiev criticizes psychology for dividing psychological factors into heredity and environment (nature and nurture) (p.101). When we examine individuals, we find that the two factors have a dialectical relationship: "The personality, like the individual, is a product of the integration of processes that realize the life relationships of the subject. There exists, however, a fundamental difference of this special formation, which we call personality. It is determined by the nature of the very relationships that form it: the social relations specific for man into which he enters in his objective activity." And "like these activities themselves, the process of their unification -- origin, development, and disintegration of the connections between them -- is a process of a special type, subject to special laws" (p.109). Again, we see this focus on "integration of processes" that we saw in Vygotsky, and this integration is conceived as dialectical.
(Note to myself: Go back and compare this notion of mediation with Latour's account from Pandora's Hope. How thoroughly is dialectic integrated into activity theory's account of mediation?)
Back to personality formation. Leontiev criticizes the "fetishism" that dominates psychology, in which personality is attributed to the nature of the individual, whereas its manifestations change "under the influence of external environment alone" (p.109). This fetishism "is the result of ignoring that most important position that the subject, entering into society in a new system of relationships, also acquires new -- systemic -- qualities that alone form the real character of the personality: psychological when the subject is considered within the system of activities realizing his life in society, social when we consider him in the system of objective relationships in society as their 'personification'" (pp.109-110). He says that the principal methodological problem is "the problem of duality of qualities of social objects, which is engendered by the duality of the objective relationships in which they exist." But "the true way to investigate personality lies in the study of those transformations of the subject ... which are the result of the self-movement of his activity in the system of social relations" (p.110).
In terms of personality, "'knots' that connect separate activities are tied not by the action of biological or spiritual forces of the subject which lie within him but by that system of relationships into which the subject enters" (p.114). Leontiev here is talking about the interrelated activities into which the individual enters, not the interrelationship of chained activities -- the latter has been underdeveloped in activity theory until recently. His example: A child is asked to get an object that was out of reach, without leaving his place. "As soon as the child began to solve the problem the experimenter went into an adjoining room from which he continued the observation, using the optical apparatus that is usually used for such observations. After a series of unsuccessful attempts, the child got up, approached the object, took it, and quietly returned to his place. The experimenter immediately came to the child, praised him for success, and offered him a piece of chocolate as a reward. The child, however, refused it and when the experimenter began to question him the youngster quietly began to cry." Leontiev says that the child wept because he found himself in a conflict or "collision" between two activities (p.114). These sorts of coordinations -- and conflicts -- among activities are evidence of the forming of personality (p.115). "Behind the relationship of activities there is a relationship of motives" (p.115).
Leontiev discusses the development of the child's personality through relationships to things and people -- two different types of relationships that are initially merged, "but later they separate and form various, although interconnected, lines of development merging one with another." These transitions "are expressed in alternating phases": practical and cognitive phases alternating with societal phases. "As a result, there appear those hierarchical connections of motives that form the 'knots' of personality" (p.126). Compare to Bakhtin's explanation of dialogue, which is developmentally less rich and well grounded, but which also doesn't rely on dialectic and allows for "unmerged" aspects of personality.
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Reading :: Thought and Language

Originally posted: Tue, 04 Jan 2005 01:30:26
Thought and Language (First Edition)
by Lev S. Vygotsky
I was stunned to realize that I hadn't yet written a review of this classic book by Lev Vygotsky, the giant of developmental psychology whose cultural-historical approach became the basis for activity theory. This first edition of Thought and Language was published by MIT Press in 1962 with a foreword by Jerome Bruner. I understand that the second edition (1986) includes more text that was not originally translated and included in this version, so I'll have to go to UT's library soon and pick it up.
Even without those materials, though, the first edition is still a valuable piece of work. Based on the Russian book published posthumously in 1934, Thought and Language is a criticism of then-current scholarship regarding language acquisition and a description of an alternate thesis. Vygotsky based his theoretical and methodological insights on dialectical materialism and supported them with considerable work with small children -- though that work was not always terribly careful. (In the foreword to Mind in Society, Mike Cole explains that Vygotsky was suffering from tuberculosis and knew he didn't have much time to experimentally develop all of his work.)
Although Vygotsky's empirical work was primarily with children, his goal was larger than that; it was an attempt to develop a theory of general language use. Here, I think his reach exceeded his grasp. Although Vygotsky developed some valuable and important concepts, his focus on development and his allegiance to dialectic tend to get in the way of a general theory of language. That is to say, language acquisition is not necessarily the same as language use, and the latter question is neither as well explored nor as well thought out as the former in this book. In contrast to Bakhtin, who was developing his own philosophy of language at about this time, Vygotsky seems simultaneously more knowledgeable and grounded (in terms of language development) and more naive (in terms of how language is used in everyday adult life).
Before developing this idea, let's get a sense of Vygotsky's general direction. Vygotsky, as I said, worked primarily with children and was interested in language acquisition. He complains in Chapter 1 that many language researchers try to take an "elemental" approach in breaking language down into elements such as sound and meaning, and famously uses the illustration of water. You can break down water into its elements -- hydrogen and oxygen -- but you can't learn much about water that way. Hydrogen and oxygen are flammable, but water isn't. To understand water, you need to study the essential unit of analysis, the water molecule (pp.3-4). Similarly, to study language, you have to look for the essential unit of analysis, which he identifies as word meaning (p.5). Readers might recognize the "germ cell" notion that Engestrom uses so much and that has its roots in Marx. "Since word meaning is both thought and speech, we find in it the unit of verbal thought we are looking for" (p.5) --- it embodies a dialectical relationship between thought and speech. "Every idea," Vygotsky says later in the chapter, "contains a transmuted affective attitude toward the bit of reality to which it refers. It further permits us to trace the path from a person's needs and impulses to the specific direction taken by his thoughts, and the reverse path from his thoughts to his behavior and activity" (p.8). That is, Vygotsky wants to develop a historical-genetic account of language acquisition and thought, an interactionist-dialectic account that allows us to retrace the developmental steps.
The interactive-dialectical relationship is used quite a bit in this book: thought-speech (p.5, 33, 125), adaptation-need (p.21), invented-given (p.33), concepts-complexes (p.74), learning-development (most of Ch.6). The concepts-complexes relationship in particular is viewed as a "ceaseless struggle" (p.74), while the thought-speech relationship is seen as "growth curves" that "cross and recross" (p.33; cf Mind in Society p.46). In each case, the pair has an interactive relationship in which both sides develop in concert, qualitatively and teleologically. It's understandable that this sort of relationship be used to characterize language acquisition, which certainly follows a particular, predictable path -- and as I think Vygotsky shows, it's a more satisfactory account of language acquisition than Piaget's or Stern's. But it's also very interesting to me that this relationship is characterized not only as interactive but as dialectical, not only as developmental but as genetic (in the educational sense, not the human genome sense). The emphasis on these particular characterizations, I think, comes from the fact that Vygotsky was basing his work on Marx's work. Although this translation barely uses the term "dialectic," I sense that it's deeply embedded in the work, such as in these theses on the thought-speech relationship:

In brief, we must conclude that:
1. In their ontogenetic development, thought and speech have different roots;
2. In the speech development of the child, we can with certainty establish a preintellectual stage, and in his thought development, a prelinguistic stage;
3. Up to a certain point in time, the two follow lines independently of each other;
4. At a certain point these lines meet, whereupon thought becomes verbal and speech rational. (p.44)

Thought and speech are different -- thought is not just internalized speech, speech is not just expressed thought -- but they don't meet their potential until they enter a predictable, developmental interactional-dialectic relationship. At that point they meet and they irrevocably change each others' character, though they never entirely merge. Indeed, "all the higher psychic functions are mediated processes, and signs are the basic means used to master and direct them" (p.56); thought only becomes higher thought by becoming verbal, by being mediated with signs.
This insight is incredibly valuable and carries us quite a ways, helping us to examine language acquisition and use in more complex ways than before. But at the same time, dialectic spells trouble when we get to general language philosophy and use. If dialectic is the ruling principle for language use, then non-dialectical interaction -- for instance, a dialogue in which nothing gets resolved, or a relationship that is indeterminate or multivalent -- can only be seen as abnormal or defective. I think that's the problem behind Vygotsky's discussion of complexes vs. concepts in Ch.5.
Here, Vygotsky explains that concept formation happens in three stages. The first is when the child solves problems by placing items in unorganized heaps. "At this stage, word meaning denotes nothing more to the child than a vague syncretic conglomeration of individual objects that have somehow or other coalesced into an image in his mind. Because of its syncretic origin, that image is highly unstable" (pp.59-60).
The second stage is what they call "thinking in complexes." "In a complex, individual objects are united in the child's mind not only by his subjective impressions but also by bonds actually existing between those objects. This is a new achievement, an ascent to a much higher level" (p.61). "In a complex, the bonds between its opponents are concrete and factual rather than abstract and logical" (p.61). Vygotsky and his colleagues identify five types of complexes:
- associative: Based on a common trait, similarity, contrast, or proximity (p.62).
- collections "on the basis of some one trait in which they differ and consequently complement one another" (p.63).
- chains: "a dynamic, consecutive joining of individual links into a single chain, with meaning carried over from one to the next" -- although that meaning might change from one end of the chain to the other (p.64).
- diffuse: "marked by the fluidity of the very attribute that unites its single elements"; that attribute may be based on "a dim impression that they have something in common" (p.65).
- pseudo-concept: it looks like conceptual thinking, but it's still a complex. For instance, when a child is asked to pick out all the triangles, he can do it, but on the basis of visible likeness (associative) rather than on the basis of concepts. The pseudo-concept is the bridge to concepts (p.66). It is "a complex already carrying the germinating seed of a concept" (p.69).
Yes, a germinating seed. One can see how the Marxist narrative of development guides this discussion of language development. And it leads to the third stage, the concept, which is a unifying theme (p.69) that allows the language user to transcend complexes and transcend the given language to form her own understandings and groups (p.67). This is where the discussion goes off the tracks, I think, because we go from language acquisition to language philosophy. Complexes, Vygotsky says, characterize not only children's thought but also the thought of primitive peoples: "Primitive people also think in complexes, and consequently the word in their languages does not function as the carrier of a concept but as a 'family name' for groups of concrete objects belonging together, not logically, but factually" (p.72). And not only primitives, but us, in the etymologies of our common words (p.73)! And this brings us to the "ceaseless struggle within the developing language between conceptual thought and the heritage of primitive thinking in complexes" -- a struggle that is not so ceaseless after all in terms of individual words, since the concept usually wins (p.74).
That's a troublesome conclusion to draw, since the implication is that modern (as opposed to primitive) societies converge on single abstract meanings of words and leave behind the childish associational meanings. Compare to Bakhtin's decidedly different understanding, in which the word is half someone else's and words can recall interactive but nonconvergent dialogues. It's easy to see now what Deleuze and Guattari meant when they said that multiplicity had killed off dialectic: once you accept that words always have these multiple meanings and, yes, associations, Vygotsky's notion of concept formation becomes untenable -- at least as I understand it here. It's hard to avoid the conclusion that complexes, as Vygotsky calls them, are still quite plentiful in fully developed adult speech and concepts -- though perhaps developmentally "higher" or later -- cannot supplant them.
Perhaps this notion of dialectic development is what makes the final chapter, on general language use, seem flat. Vygotsky uses examples from literature, including Dostoevsky's story of the drunks carrying on a conversation composed of a single unprintable word, but he sees dialogue as a "chain of reactions" (p.144) -- something that sounds rather similar to the chain complex -- rather than something in which viewpoints are exchanged without necessary agreement. There's something very linear about Vygotsky's depiction of dialogues and of development. Again, compare with Bakhtin.
Still, this is a fascinating book. I'm going to have to pick up the second edition, but I also need to review Morson and Emerson's compare-and-contrast between Bakhtin and Vygotsky.
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Reading :: Mind in Society (supplemental notes on dialectics)

Originally posted: Fri, 31 Dec 2004 20:04:22
Mind in Society: The Development of Higher Psychological Processes
by L. S. Vygotsky
After reading A Thousand Plateaus, it's a relief to get back to something that makes sense on the first reading. I picked up Mind in Society to revisit Vygotsky's use of dialectics, and ended up breezing through the whole book in the space of a few days.
I reviewed this book a while back, but here are some additional notes on how dialectics play into Vygotsky's work:
Vygotsky based his psychological work on the Marxist framework. For example, he uses Engels' contrast "between natural and dialectic approaches to the understanding of human history. Naturalism in historical analysis, according to Engels, manifests itself in the assumption that only nature affects human beings and only natural conditions affect historical development. The dialectical approach, while admitting the influence of nature on man, asserts that man, in turn, affects nature and creates through his changes in nature new natural conditions for his existence. This position is the keystone of our approach to the study and interpretation of man's higher psychological functions and serves as the basis for the new methods of experimentation and analysis that we advocate" (pp.60-61). Vygotsky goes on to say that stimulus-response theories are naturalistic in this sense: they are unidirectional, assuming that human behavior reacts to nature but does not change nature (p.61). His analytical approach, on the other hand, is based on Engels' assertion that human behavior does change nature. Three analytical principles follow:
- "Analyzing process, not objects." Psychology should be developmental; we should reconstruct stages of development rather than focusing on milestones. We should "trace" development. (pp.61-62)
- "Explanation vs. description." Vygotsky accuses associationist and introspective psychology of being descriptive rather than explanatory, and notes that explanation alone doesn't suffice. His analogy is that, based on description alone, a whale seems closer to a fish than a terrestrial mammal. Rather, we should pursue genotypic (explanatory) rather than phenotypic (descriptive) explanations: "By a developmental study of the problem, I mean the disclosure of its genesis, its causal dynamic basis. By phenotypic I mean the analysis that begins directly with an object's features and manifestations" (p.62). He goes on to give examples from research into early speech development. And he quotes Marx for support (p.63).
- "The problem of 'fossilized' behavior." Since Vygotsky is interested in processes and their explanations, he is drawn to a study of "process that have already died away, that is, processes that have gone through a very long stage of historical development and have become fossilized" (p.63). These -- what I take to be "operations" in the Leontievan sense -- have been around long enough that they have become "mechanized," detached from the activities that originated them. "They have lost their outer appearance," Vygotsky says, and so "their automatic character creates great difficulty for psychological analysis" (p.64) -- particularly Vygotsky's analysis, which must reconstruct their development. Vygotsky says that we can get to this development by focusing, once again, on the process: we can alter the behavior and "turn it back to its source through the experiment" (p.64). We can see him doing this through his many case studies.
Vygotsky summarizes: "To study something historically means to study it in the process of change; that is the dialectical method's basic demand. To encompass in research the process of a given thing's development in all its phases and changes -- from birth to death -- fundamentally means to discover its nature, its essence, for 'it is only in movement that a body shows what it is.' Thus, the historical study of behavior is not an auxiliary aspect of theoretical study, but rahter forms its very base" (pp.64-65). The dialectical method's basic demand, then, is for a historical study of change, particularly in terms of the qualitative transformations that an organism undergoes.
Vygotsky amplifies this point in his discussion of child development. "Our concept of development implies a rejection of the frequently held view that cognitive development results from the gradual accumulation of separate changes. We believe that child development is a complex dialectical process characterized by periodicity, unevenness in the development of different functions, metamorphosis or qualitative transformation of one form into another, intertwining of external and internal factors, and adaptive processes which overcome impediments that the child encounters" (p.73).
In their afterword, Vera John-Steiner and Ellen Souberman call Vygotsky's method "interactionalist-dialectical" (p.124) -- a good term, since there are plenty of psychological theories that are interactionalist but not dialectical.
A few things might strike us here. First, Vygotsky's relentless focus on development is, as he says, based on the Marxist dialectical account. Recall that Deleuze & Guattari declare dialectics "dead" because of multiplicity (see my more recent review of A Thousand Plateaus): signs don't simply develop, they form interconnections that are antimemories, antigenealogies, antihistories. Serres and Latour make similar charges. Vygotsky's whole thesis, that psychology is developmental, tends to elide the sorts of ahistorical associations that these other authors highlight. In fact, Vygotsky explicitly argues against an associational understanding of psychology. This makes some sense given the problems on which Vygotsky was working, but it also suggests that there might not be enough room in his approach for nondevelopmental phenomena.
We can also contrast with Bakhtin, who was working at about the same time on his philosophy of language. Like Vygotsky, Bakhtin was conscious of cultural-historical development and wanted to produce an interactionist understanding of it. But Bakhtin, unlike Vygotsky, thought in terms of dialogue rather than dialectic. Vygotsky's interactionalist-dialectical approach -- in my tentative reading -- assumes historical development of a unitary consciousness through a series of dialectical events, i.e., a series of interactions with the environment. Bakhtin's interactionist-dialogical approach, on the other hand, does not assume a unitary consciousness or a permanent settlement. The "voices of the mind" (see Wertsch) are voices of different participants interacting, never coming to a permanent agreement that would produce a unity of consciousness. That is to say, Bakhtin's dialogism provides a basis for a cultural-historical understanding of associations; perhaps Vygotsky's dialectical materialism does not. And maybe that's why I recognized so much Bakhtin in the more lucid patches of A Thousand Plateaus.
Obviously I'm in the middle of thinking through these issues, and I'm pretty sure things are not so clear cut. I'm planning to reread Vygotsky's Thought and Language soon, along with parts of Morson and Emerson's Mikhail Bakhtin: Creation of a Prosaics, so hopefully I'll have more answers soon.

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