The Epic Rise of John D. Rockefeller
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In addition to an incredibly thorough (and even-handed, IMO) treatment of Rockefeller, I found it an interesting perspective on the post-war period in the US.
Rockefeller was relentless in ferreting out ways to cut costs. During an inspection tour of a Standard Oil plant in New York City, for instance, he observed a machine that soldered the lids on five-gallon cans of kerosene destined for export. Upon learning that each lid was sealed with 40 drops of solder, he asked, "Have you ever tried 38?" It turned out that when 38 drops were applied, a small percentage of the cans leaked. None leaked with 39, though. "'That one drop of solder', said Rockefeller,...'saved $2,500 the first year; but the export business kept on increasing after that and doubled, quadrupled--became immensely greater than it was then; and the saving has gone steadily along, one drop on each can, and has amounted since to many hundreds of thousands of dollars"' (Chernow 1998, pp. 180-81). Over the course of his career at the helm of Standard Oil, "Rockefeller cut the unit costs of refined oil almost in half" (Ibid., p. 150)."Rockefeller was relentless in ferreting out ways to cut costs. During an inspection tour of a Standard Oil plant in New York City, for instance, he observed a machine that soldered the lids on five-gallon cans of kerosene destined for export. Upon learning that each lid was sealed with 40 drops of solder, he asked, "Have you ever tried 38?" It turned out that when 38 drops were applied, a small percentage of the cans leaked. None leaked with 39, though. "'That one drop of solder', said Rockefeller,...'saved $2,500 the first year; but the export business kept on increasing after that and doubled, quadrupled--became immensely greater than it was then; and the saving has gone steadily along, one drop on each can, and has amounted since to many hundreds of thousands of dollars"' (Chernow 1998, pp. 180-81). Over the course of his career at the helm of Standard Oil, "Rockefeller cut the unit costs of refined oil almost in half" (Ibid., p. 150).
What, don't you like monospace fonts??The man loved money. He loved keeping track of it down to the last detail. He even used to chant "one day I will be rich, rich, rich"!
Very interesting man. Given his character and the conditions he was in, it wasn't at all surprising he amassed so much wealth.
Zuck is just a manipulator and as he is so young, I don't expect his actually legacy to take hold for at least 40 years. But musk is much more a Titan than zuck. Zuck isn't really doing anything outside his comfort zone - but that doesn't mean that oculus won't be a thing in 20 years - but I wouldn't credit that to zuck.
“Bezos kept pushing for more. He asked Blake to exact better terms from the smallest publishers, who would go out of business if it weren't for the steady sales of their back catalogs on Amazon. Within the books group, the resulting program was dubbed the Gazelle Project because Bezos suggested to Blake in a meeting that Amazon should approach these small publishers the way a cheetah would pursue a sickly gazelle.
As part of the Gazelle Project, Blake's group categorized publishers in terms of their dependency n Amazon and then opened negotiations with the most vulnerable companies. Three book buyers at the time recall this effort. Blake herself said that Bezos meant the cheetah-and-gazelle analogy as a joke and it was carried too far. Yet the program clearly represented something real--an emerging realpolitik approach toward book publishers, an attitude whose ruthlessness startled even some Amazon employees. Soon after the Gazelle Project began, Amazon's lawyers heard about the name and insisted it be changed to the less incendiary Small Publisher Negotiation Program.” ― Brad Stone, The Everything Store: Jeff Bezos and the Age of Amazon
Although Apple is also famous for ruthless negotiation with publishers, they're proud enough that an Apple copy (e.g. the U-turn on styluses) will rarely be cheaper than what they've taken inspiration from.
As someone else noted, Bezos might follow along with Gates, but it appears Bezos is more like Sam Walton than a Rockefeller. Walmart sprawled into numerous other categories, attempting to perpetually find new ways to make money at the edges of its empire; Walmart is a hyper low margin business, built on low prices and high efficiency; both Sam Walton and Bezos retained very large stakes in their businesses despite the size; both kept fundamental control. Amazon has no serious monopoly category however, and they have a comparatively weak cash generation capability (AWS is spitting off some nice operating income, but it pales in comparison to the very high margin cash spigot that Windows was).
Completely fascinating history of the home furnishings industry and how globalization completely upended it.
I used Netscape in the 90s. It was a crummy product that crashed if you looked at it. IE was much more stable. IE was better, much better. Opera was also available, but there wasn't much to recommend it.
As for Apple in the 90s, Apple nearly destroyed itself all by itself. Check any of the innumerable books on the history of Apple.
Oh, and by the time Netscape 4.7 and IE 4.01 were released, Microsoft had already destroyed Netscape's business.
If you produce an obviously inferior product, it's a bit unfair to blame the competition for your own failures.
Someone who is currently 18 years old never experienced computing when it wasn't near seamless as it is today.
Do you know what was different? A lot of people had very poor judgement about what to install and what to trust. Also faulty drivers, but this still happens today! No further than last night this very computer reset when starting Firefox :-/
I'm very surprised to see this revisionist version of computer history. I can't help thinking that there's some vested interest in this criticism. At the time it was some sort of fad among Linux fans against Windows dominance. I also liked Linux, but it was very annoying to see this kind of (reverse!) FUD.
Now it seems like it's some other "interest group" that's spreading it. Depressing.
Other than being entirely contradicted by the court's findings of fact in DoJ v. Microsoft.
This was part of Microsoft's strategy from the very beginning. Look up Andrew Orlowski's story "The Canonization of Saint Bill", in which a former Intel executive recalls an early 1980s meeting with Gates and Ballmer explicitly offering to carve up the IT market in a three-way split between IBM, Intel, and Microsoft.
I was in the industry from the late 1980s onward, and saw what and how Microsoft operated. Testimony and findings of fact from the DoJ case, the Novell case, the SCO vs. IBM case, and others, all paint the same story.
And yes, some of the competitors exhibited incompetence or limited vision. But "DOS ain't done until Lotus won't run", and similar variants, are very much part of the history:
The strategic side is: ... We put a bullet in the head of our would be competitors on DOS like DRI, Desqview, dos extenders etc. - Nathan Mhyrvold, Microsoft Corp., May 9, 1989. Business as usual.
You're quite adept at dragging goalposts, but the point remains they've moved, and you're not defending the original point. I'll interpret that as your having conceded it.
Thank you.
As for Microsoft warning people that Windows was not tested with DRDOS - so what? Why would they be obliged to test against DRDOS? Why would they be obliged to support Windows on DRDOS?
I remember in even earlier days PC clone BIOSes would contain the string: "some programs expect the string 'Copyright IBM' here". IBM was unable to stop the clones. Microsoft could not stop DRDOS from faking whatever detection mechanism their was, why didn't DRDOS do that? Why didn't DRDOS offer better deals to OEMs? Why didn't DRDOS offer their own Windows? Why didn't DRDOS offer a dos that was much better, rather than only slightly better?
And the "bullet in the head of dos extenders" was simply puffery, as I was directly involved in the dos extender business and no such thing happened. My dos extender made DOS into a viable 32 bit operating system - why didn't DRDOS come knocking and buy that? Microsoft had nothing like it.
In my not-so-humble opinion, DRDOS had many opportunities to counter, and they didn't. Microsoft didn't owe them any consideration. What Microsoft execs said isn't any more material than rah-rah locker room talk amongst a football team about them murdering the other team.
One big problem a lot of people forget is how quickly the web was moving back then. 3.0 came out in mid-1996, and soon there were many sites that wouldn't work with 2.0. 4.0 came out in mid-1997 (technically before 3.0.3), and by late 1998 I had to upgrade to the 4.0 series, because a lot of the web didn't work in 3.0.
It was actually DoubleClick that made me switch to IE - they started serving Javascript that hung every version of Netscape, which broke a lot of the web.
Until Microsoft stopped keeping up with everyone else. You're reinforcing his point, Microsoft would have put everyone else out of business had it not been for antitrust issues. Competition is vital even when it's sub-par because it won't always be.
Nobody knows what might have happened. The point is, it didn't happen and never did. And today Microsoft finds it very difficult to compete in the phone, search, and cloud market, and none of that difficulty is due to the Justice Dept's actions.
Wrong, it did happen, to Netscape. Microsoft's bundling of IE for free destroyed Netscape as a viable business.
I know for a fact that Netscape was an inferior product to IE. I downloaded IE and uninstalled Netscape. I made an extra effort to not use Netscape anymore, because it was nearly unusable due to crashing. Maybe if Netscape had a better product, I'd be sympathetic.
It's not a conspiracy if an inferior product fails in the marketplace. Happens all the time.
Ironically, I use Chrome now because IE crashes constantly when accessing github.com.
I presume you mean the "anti-competitive practice" of including it with Windows. Windows is full of utilities that come with it, ditto with every other operating system before or since. Why is a browser special? Why are other companies entitled to not have competition from Microsoft? What do you make of Linux coming bundled with huge swaths of quality free software?
> As you can't seem to tell the difference
You're quite right :-)
This is not accurate. BP stands for British Petroleum and has never been part of Standard Oil. BP has bought a couple of companies that used to be part of Standard Oil.
i thought it's common strategy played in AOE....
this post makes a great companion with another recent post about Uber on Lyft.
You can't beat it.
back to the good ole' dats
Stock updates were also sent automatically over telegraph starting in the 1870s for anyone that owned a ticker tape machine[1]. There were also teleprinters that sent news stories and other information to those that owned them.
Fax machines were also invented in the mid 19th Century and allowed for the transmission of signatures and drawings over telegraph[2].
The basics for an asynchronous, global communication system have been around since the 1800s, just not as cheap and user friendly as what we enjoy today.
"Coming on the eve of the muckraking era, Rockefeller’s alopecia had a devastating effect on his image: It made him look like a hairless ogre, stripped of all youth, warmth, and attractiveness, and this played powerfully on people’s imaginations. For a time, he wore a black skullcap, giving him the impressively gaunt physiognomy of a Renaissance prelate. One French writer wrote that “under his silk skull-cap he seems like an old monk of the inquisition such as one sees in the Spanish picture galleries.” 46"
I recommend that you read "Titan" by Chernow. Rockefeller is mostly guilty simply of being very rich. During his career, he caused the price of kerosene to drop 70%, and stay down. This was good for the expanding country.
During the anti-trust trial, Rockefeller was steadily losing market share to nimbler, aggressive competitors. There was no need for the government to break it up, it was coming apart anyway.
All businesses rise and fall over time. The popular narrative that, unchecked by government, a business will eventually rise to absorb everything is not borne out by practice.
I get your point, but there are exceptions. In particular, utilities come to mind. All locations I've lived except 1 provided exactly one option for high-speed internet. I don't see that changing in most parts of the US any time soon. Ditto for water and electricity, depending on locality. Even temporary monopoly abuse in either of those two sectors can have devastating humanitarian impacts.
The gov't gives the utility a monopoly in exchange for full coverage to all customers and pricing oversight.
(note: not continuing with this thread because holy fuck hivemind downvotes.)
Interesting assertion, do you have any books/data to back that up?
If you ever think you have found a single instance of monopoly lasting any significant length of time, look deeper - with absolute certainty there is a government gun backing it up.
Absolutely incorrect as it allows for the abusive monopoly to exist for an undetermined amount of time possibly preventing competition more than long enough to do harm. This argument is equivalent to saying all murders die eventually so there's no need to outlaw murder.
Just because something self destructs "eventually" is not sufficient reason to not regulate it and is certainly not a good argument against regulation.
edit replying to below:
> I'm curious what harm you accuse SO of. Keep in mind that SO dropped the price of kerosene by 70% and kept it down. reply
Why should I keep that in mind? Doing a good thing doesn't mean you didn't also do bad things so that's simply not a relevant fact in this discussion.
It is historical fact he used anti-competitive practices[1] to sabotage the competition, the harm caused was to those trying to compete with him and it's exactly the reason we now have anti-trust laws.
But that caveat lets the horse out of the barn, since the gains made by monopolies can purchase lobbyists and thence the government gun. Disney Studios has been around 93 years at this point.
Intellectual property is considered a monopoly assigned by the government.
My example aside, is it really so hard to believe that successful companies can influence regulation? Monopolies are exceptionally successful companies.
There is no such popular narrative-that's merely a strawman you've created-the popular narrative is that monopolies can and do form (not always, but can) in the absence of government rules to prevent them and that such monopolies are bad for capitalism. That is a fact borne out by history.
> Rockefeller is mostly guilty simply of being very rich
No, he's guilty of abusing the power of his near monopoly to sabotage competition just as the OP said. He's not reviled for his wealth, but for the unethical ways in which it was maintained.
Businesses do rise for a period of decades, however, and can do a lot of damage along the way should they decide to leverage monopoly or otherwise kill competitors unfairly.
People have learned from this by having a settlement (or rainy day fund) specifically for the government.
You can use it as educational, as a cautionary tale, but there isn't need to pass any retroactive judgment on it, in my opinion. No need to either rosy it up, or highlight something you would rather consider abominable.
He was a complicated man, no doubt, and he tended to gloss over some of the consequences of his actions when recalling his past, but he was, mostly, just vilified for being a brilliant businessman at a time when it was popular to do so.