8 Computer

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T wo weeks ago, I was seducedinto purchasing a new versionof a particular piece of graph-ics software. For months, Ihad held strong to the mast as

the Upgrade Sirens sang their beauti-ful tunes across the waters. “Theupdated version is better,” they called,“and it has more features.” I held tomy convictions until that soaringmelody was joined to a dark refrain.“The old software,” sang the chorus“will no longer be supported.” Withthose words, I sent my credit cardnumber on a voyage to the commer-cial side of cyberspace and waited forit to return with the promised upgrade.

The process took barely 30 minutes,but when it finished, my word pro-cessing software no longer worked.Being dependent upon a good wordprocessor for my livelihood, I imme-diately fired an e-mail message to thesupport staff of the firm that had sentme the upgrade. This e-mail wasanswered almost immediately by apleasant young man named Sanjay,who indicated his willingness to help.

From here, the story played out in apredictable way. Although Sanjay cer-tainly had many admirable qualities,

he was not much of an expert on soft-ware. All of his answers came fromscripts that he obviously barely under-stood. After three or four fruitlessexchanges, Sanjay confessed that hecould not identify the source of theproblem. When I asked, in a tone gen-tle but firm, what I might do to restoremy system, he offered a surprisingreply. Rather than giving an apology,he suggested, without a hint of irony,that I should learn more about thecomputer and attempt to fix the prob-lem myself.

His comment stung a bit, but it setme on the course that ultimatelyresolved the problem. For about anhour, I stared at the list of processesas I tried to start and stop the wordprocessor. Seeing a pattern, I did a lit-tle bit of Internet searching and founda piece of code that put things right.This solution brought a mix of emo-tions. I was proud that I still had sometechnical skill, relieved that my com-puter worked again, and a little dis-oriented by the exchange with Sanjay.

In hindsight, I came to realize thatSanjay was not really a trouble-shooter—a technician who knewenough of the scientific method to

identify and isolate a problem. He wasmerely a guy who was paid to read thereference manual for others. He onlyknew how to work with standardizedknowledge, with ideas that are orga-nized into fixed and narrow categories.

Sanjay’s job was created by two par-allel forces that marched through thesecond half of the 20th century. Thefirst is the rapid growth of the infor-mation technology industry, whichcreated the means to organize, process,and transmit data around the world.The second is the rise of global trade.

GLOBAL TRADING SYSTEMThe age of the computer and the

modern age of global trade can bothbe traced to February 1946. In thatmonth, the University of Pennsylvaniaannounced the ENIAC, and the rep-resentatives of 18 countries begandrafting a new set of rules to governinternational trade. These rules,known as the General Agreement onTariffs and Trade, or GATT, initiateda tremendous expansion in worldtrade. “It was a time of recovery,development and growth in the worldeconomy,” recalled one participant inthe talks. Firms found new marketsfor their goods and “trade grew fasterthan production.”

As the trading economy grew, itchanged the basic nature of businessoperations. It forced business leadersto think in terms of global productionand global markets. They would pur-chase raw materials in one country,operate production facilities in a sec-ond, and market the finished goods ina third.

The Vernon cycleFor the first two decades of this new

era, economists struggled to find pat-terns in the new flow of goods and ser-vices. “Anyone who has sought tounderstand the shifts in internationaltrade and international investmentover the past twenty years,” wroteHarvard professor Raymond Vernonin 1966, “has chafed from time totime under an acute sense of the inad-equacy of the available [economicconcepts].”

Across the Great DivideDavid Alan GrierGeorge Washington University

Like the computer age, the era of global trade has come with a new sense of standardization.

July 2006 9

It was spread through the young com-puter industry by projects such as theAir Force SAGE system and the IBMStretch project, but it remained firmlyrooted in the major computer researchcenters. None of the manufacturersagreed on a common design for suchmemories, and all of them kept theirmanufacturing facilities in the US orEurope.

Between 1955 and 1964, core mem-ory shifted into the maturation stage.It had become the memory of choicefor most commercial machines. It hadalso evolved into a couple of com-monly used designs. In 1964, it movedinto the final stage of the Vernon cycle,standardization. At this point, themajor computer manufacturers under-stood how to design core memoriesand sought ways to increase their pro-duction of this technology.

To increase memory production, thelarge computer firms were attemptingto develop standardized designs thatcould be manufactured by machine.IBM was particularly aggressive in thiseffort. It created vacuum forms tohold the cores and hollow needles todo the weaving. One IBM engineerdecided to take another approach tothe manufacture of these memories.“He took a few bags of cores, rolls ofwire and some core frames to Japan,”reported historian Emerson Pugh. “In ten days he returned with hand-wired core planes as good as thosethat had been wired by the automaticwire feeders in the [IBM] Kingstonplant.”

Within a year, IBM was importingcore memory units from Japan andgaining the benefits of lower produc-tion costs. Pugh reported that theJapanese memories were “a few dol-

From his observations of the emerg-ing global trading system, Vernon cre-ated a simple model that has becomethe common way of describing howhigh-tech goods and services developin the world economy. This model,often referred to as the “Vernon cycle,”has three distinct stages: development,maturation, and standardization.

In the development stage of this the-ory, a product can only be made inclose proximity to the knowledge thatcreated it. In the maturation stage, theproduct can be made in any techni-cally sophisticated economy. In thestandardization stage, the product isso well understood that it can be madein almost any modern economy. Atthis point, the production of the prod-uct moves to the area that has the low-est manufacturing costs. The area thatinvented the product, which onceexported it, now becomes an importer.

Core memoryThe Vernon cycle is often illustrated

with the example of magnetic corememory, a form of high-speed mem-ory that was relatively inexpensive forits time. Core memory consisted of awoven grid of fine wires, much like acoarse metallic cloth. At the pointswhere wires crossed, they passedthrough fine magnetizable cores, littleceramic units that were shaped like an“o.” By applying current to the appro-priate wires, the computer could mag-netize a specific core, thereby storinga value in the memory. By applyingcurrent to a slightly different set ofwires, the computer could read thecontents of the memory.

Core memory was developed in the early 1950s in at least two differ-ent computing laboratories: HowardAiken’s at Harvard and Jay Forrester’sat MIT. These two facilities producedvery different versions of core memory,and both laboratories required highlyskilled individuals to help build thememory. At Harvard, the core memorywas built and tested by An Wang, agraduate student who would eventu-ally form his own computer company.

Core memory remained in the devel-opment stage through the mid 1950s.

lars per plane cheaper” than thosemade by machine in the US.

Yet, in moving core memory pro-duction to Japan, IBM was influencedas much by its own engineering prac-tice as by the cost of labor. Over aperiod of eight years, IBM engineershad developed detailed sets of rules andspecifications for both the core mem-ory units and for the manufacture ofthose units. As they did this engineer-ing, they anticipated that core memoryplanes would be woven by machine,but they found that their detailed spec-ifications also allowed hand weavers todo the work. If IBM had not done sucha thorough job of standardizing theirproduct, it would not have been ableto send memory production aboard.

The Vernon cycle has been repeatedfor other pieces of computer hard-ware, including memory chips, proces-sor chips, motherboards, and digitaldisplays. In each of these cases, com-panies have been able to move theirmanufacturing to low-cost facilitiesbecause they have done the detailedengineering that lets them do so. Overthe past two decades, companies havebeen consciously designing their prod-ucts to allow using low-cost facilitiesthat are located at a distance. They nolonger move into Vernon’s standard-ized stage of production withoutknowing the full ramifications.

LOW-COST SERVICESIn the past 15 years, we have begun

pondering the idea that the Vernoncycle applies to services as well as toproducts. Some services, such as callcenters or the help desk that assistedme with my software, are clearly standardized activities. Such servicesenforce standardized management

IEEE Annals of the History of Computing Published quarterly, IEEE Annals of the History of Computing is the Computer

Society’s historical magazine. In addition to stories about the innovation and development of the computer, Annals has published articles describing the globalization of the computer industry. The first issue of 2005, vol. 27, no. 1,contained a section of articles on computing in Japan. The upcoming issue,vol. 28, no. 3, will contain two articles on computing in Russia.

10 Computer

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practices, have systematized ways ofstoring information, and follow spe-cific rules for engaging customers.Hence, they have followed the Vernonmodel, and they have moved to coun-tries with the cheapest labor.

Currently, the computer sciencecommunity is attempting to determineif software engineering is followingthe Vernon cycle and becoming a ser-vice that can move to the lowest-costproduction site. The answer to thisquestion is far from clear.

Although software engineering hasrules and standards, it cannot be eas-ily compared to a standardized prod-uct, like core memories, or to a stan-dardized service, like a help desk. Atthe same time, some of the larger soft-ware projects that have moved out ofthe US seem to have a mechanical orrote nature. The work by Indian pro-grammers on the Y2K problem is acommonly cited example of this phe-nomenon. This work required somecreativity and a fair amount of knowl-edge, but it dealt with a narrow, tech-nical problem.

MOTIVATING FACTORSEarly in my career, I had a brief

exposure to the forces that move soft-ware engineering services to lower-costproviders. While still a student, I wasemployed by the Burroughs Corp. andgiven the task of adapting a large engineering system for one of theBurroughs mainframes. I found thework straightforward but overwhelm-ing. In all, the programs had severalhundred thousand lines of code thatneeded to be adjusted. When I askedfor help, my manager assigned me twoassistants, Naveed and Vikram, whoworked for the Tata Group, an Indiancompany that provided temporarysoftware services to Burroughs.

The three of us finished the projectin about six weeks of brutally system-atic work. It was like working on an

assembly line. I remember not a sin-gle lesson from the experience. Nomastery of new language structure.No clever programming techniques.No creative solutions. For days onend, we poured over line after line ofcode. We altered variable names, sim-plified complex statements, adjustedvariant syntax, and checked the pro-gram output against results from aControl Data computer. It was miser-able work.

My only pleasant recollection of thatexperience is the evenings, whenNaveed, Vikram, and I went into town.We were three young men with time onour hands, money in our pockets, anda city to explore. During these nights,my colleagues introduced me to thewonders of Indian food—naan, tan-doori chicken, rogan josh. In return, Ioffered ice cream, barbequed chicken,and deep fried seafood from a pier inthe bay.

Over these meals, we attempted toshare the stories of our lives. Wetalked about where we had gone toschool, what our parents had beenlike, what games we had enjoyed aschildren, how we had become inter-ested in computers.

As the summer progressed, wefound that we could not discuss thesimplest things about ourselves with-out delving into our own cultures.How do you explain your affectionfor meals of aloo gobi without talkingabout your mother and her mother?How do you describe your love forpopular music without explaining theculture that created that music? Howcan you even talk about political lead-ers in an interesting way withoutspeaking about the historical forcesthat brought those leaders to power?

Eventually, our dinners becamequiet affairs. We might attempt toexplain the evening’s meal or makesimple references to the events of theday, but we would usually say little

until someone initiated a conversationabout technology. Even then, we stuckto narrowly constrained subjects. Wewould never speculate on the futureof Burroughs or the strategy of theTata Group. Instead, we would talkabout the subjects that we had in com-mon: the problems with the programcode and potential solutions that wehad found in the computer manuals.

S ome 30 or 40 years ago, whencomputers were becoming estab-lished in business and govern-

ment, these new machines drewcomplaints from people who dislikedthe standardization that they imposed.“I am a person, not a number” was acommon rallying cry for those whoresisted the new technology. In the past15 years, global trade has produced asimilar reaction for similar reasons.

Twice a year, when the large groupsof trade protestors come to town, myoffice neighborhood is filled with peo-ple who decry the impact that stan-dards and global trade have had onlocal economies. I walk past themknowing that they are partially rightand partially wrong. Global trade hasindeed destroyed local industries but,at the same time, it has generally giventhe world a higher standard of living.

Like the computer age, the era ofglobal trade has come with a new senseof standardization. Trade agreementsare technical documents that includelengthy sections of technical defini-tions, rules, and standards. Hence, it isprobably not surprising that the goodsand services that have moved most eas-ily from economy to economy andfrom culture to culture are those thatare easily standardized. ■

David Alan Grier is the editor in chief,IEEE Annals of the History of Comput-ing, and the author of When ComputersWere Human (Princeton UniversityPress, 2005). Grier is an associate pro-fessor in the Center for International Sci-ence and Technology Policy at theGeorge Washington University. Contacthim at grier@gwu.edu.

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