Benʼs working notes
About these notesBell labs had a budget of 2.8 billion 2020 dollars
Bell labs had a budget of 2-8 billion 2020 dollars
(The above is from gertnerIdeaFactoryBell2012) In 1930 Bell Lab’s budget was ($1930)19M (which is ($2021)297.6M) science and business at GE and Bell 1876-1926
In 1974, for example, Bell Labs spent over $500 million on nonmilitary R&D, or about 2 percent of AT&T’s gross revenues. Western Electric spent even more on its internal engineering and development operations. Thus, more than 4 cents of every dollar received by AT&T that year went to R&D at Bell Labs and Western Electric.
From The End of AT&T
In 1974 Bell Lab’s Budget was ($1974)500M which is $2.8B USD
That is a lot of money, but it’s important to consider that The famed bell labs research was a fraction of their activity - a lot of that money was actually going towards practical, incremental developments like better cable sheathing.
Also by comparison, Microsoft spent $19.6B on R&D in 2020 on a revenue of $147B which is actually a larger % than bell labs. Google(Alphabet) spent $27.8B on a $171B revenue. To get a sense of a company that is not based on bits, Corning spent $0.99B on R&D with a revenue of $11.29B.
It’s also important to compare the Bell Labs budget to AT&T’s profit of $18B Competition and Ma Bell - The Washington Post and a revenue of $88B. Bell Labs represents a larger fraction of AT&T’s budget than DARPA does of the DoD’s budget. According to DARPA Website, DARPA budget was $3B which was 0.5% of the $617 Billion DoD budget. The two things to keep in mind in this comparison are first that DARPA only gets things to the prototype stage and the DoD spends much more money on product development in other organizations and that Bell Labs got some of its income from the operating companies that paid into AT&T rather than AT&T itself so that $5B may not have come directly out of the $88B.