Entertainment companies tried several times to break into tech, but they couldn't hire good technical people. Partly because technical people had seen how poorly entertainment companies had been rewarding their musicians.
A few misguided tech companies who brought in Hollywood execs (like Terry Semel at Yahoo) saw their tech talent evaporate as the new execs made it clear they thought of programmers as pretty much the same thing as set carpenters.
As you mention, many tech founders (Jobs & Woz, Bill and David) had significant contact with the entertainment industry. They decided to run their companies differently and treat the engineers much better, and it worked.
Parts I and II represent a very selective, shallow, and misleading treatment of the history of Silicon Valley. Equating early entertainment-related sales with launching HP and Ampex is completely wrong.
Consider the sentence: "Disney placed his order in 1938, which led to the launch of Hewlett-Packard in 1939." No, Hewlett and Packard had discussed starting a company for years, and were bankrolled by their advisor Fred Terman ($538) to form a business. Hewlett had designed an oscillator for his Masters thesis, and Disney Studios placed the first order ($517.50) in 1939.
Another: "The transistor radio, which brought portable music to the mass market, paid the bills to fund the rise of Shockley’s personal business empire and the establishment of a robust semiconductor industry in Silicon Valley." Sony licensed the transistor technology from Bell Labs, where Shockley was employed and he, Brattain and Bardeen demonstrated the first working device. As an employee, Shockley did not receive royalties for this invention. And Shockley did not have a 'personal business empire' - he started Shockley Semiconductor Laboratories with the funding of Beckman Instruments (which was based in L.A., so can be lumped in to the music industry; after all, Shockley went to Hollywood High School!), and completely failed in that business, causing the 'traitorous eight' to defect and form Fairchild Semiconductor, which created the 'robust semiconductor industry in Silicon Valley.' Shockley ended up teaching at Stanford, descending into bizarre race theories and eugenics.
Even the Ampex story is incomplete, ignoring the fact that Bing Crosby had been using audio recorders developed by engineer John Mullin based on German 'Magnetophons' that Mullin, a Army Signal Corps officer, had confiscated at the end of WWII. Mullin rebuilt and demonstrated these systems, and connected Crosby's engineers with Ampex for production of additional units. Ampex was already 3 years old, and was 'funded' by Tomlinson Moseley (who encouraged his employee Alexander Poniatoff to start the company), not Bing Crosby.
Finally, the statement "Jobs learned the ropes in high tech while working at Atari for Nolan Bushnell, who had moved from his native Utah to California because. . . . he wanted to get a job at Disney" is incredibly tortured logic. Bushnell was fascinated with arcade games (which was an industry based in the midwest) and learned about computer games (Spacewar!) while a student at Utah. He came to SV to work at Ampex, but almost immediately started working on what became Pong.
If you want to simplistically assign the role of 'funder of silicon valley' to an entity, you would have much more reason to choose the U.S. Government than the music industry.
Hey Ted. Great article, you make a persuasive case. I had always thought it was US defence spending that helped Silicon Valley develop and hadn’t appreciated the role of the entertainment companies.
Incidentally, have you interpreted the statistic about teenagers correctly? I think it’s saying that 44% of all consumer spending on music was by teenagers, not that teenagers spend 44% of their income on music. The former seems even more impressive to me. I did have to read that chart a few times to make sense of it.
Brilliant observation as always, a great article. I think they have also devalued live music along with recorded music. Just finding somewhere to perform your music is hard enough, let alone getting paid to perform it.
I did IT in the publishing industry in the 1990s and left after a few years of banging my head against the wall there for reasons such as some of those mentioned here.
Yet there was another big reason why the media industry couldn't retain tech talent, and it was an ironic one: Hollywood studios aside, many major media companies were based in NYC in proximity to Wall Street. In the 80s and 90s, if you had IT skills, you could work for a bank instead of a publishing, music, or broadcasting company and make up to 2-3x the money. It was simple: while media companies hired IT people and set their salaries in relation to editors, Wall St. firms hired them and set their salaries in relation to bankers and bond traders. This is what happened to me.
Funny thing (or at least, personally amusing) is that Yahoo tried too early and failed. Fond memories of the era when Yahoo went all in on Music, then Hollywood... and as that trickled away, I went on to HP!
What incredible background - as a musician working currently working in the tech industry here in Nashville, this was one of the most inspiring things I've read. The link between art, innovation, & technology is undeniable.
Great article, I've hardly heard anyone voice this point of view, but to my mind, it is completely true. And being able to put it into the historical context of tech companies and entertainment is really interesting. The growth of all entertainment industries are connected at the hip to technology, so it's an important relationship to consider. I can see that some of the current music streaming technology companies are setting up their offices in the most expensive part of town, and its kind of shocking, considering how little musicians are making from their work. It would be good if some arbitrator could come out of bat for the average musician. I have heard a number of times young people say, "oh, touring will pay for that." But COVID has wiped out touring, so there is almost nothing left for a musician. Anyway, thanks for writing this.
Great summary! The demise has been hard to watch. Making music for music's sake with Wertico Cain & Gray. Best wishes.
Entertainment companies tried several times to break into tech, but they couldn't hire good technical people. Partly because technical people had seen how poorly entertainment companies had been rewarding their musicians.
A few misguided tech companies who brought in Hollywood execs (like Terry Semel at Yahoo) saw their tech talent evaporate as the new execs made it clear they thought of programmers as pretty much the same thing as set carpenters.
As you mention, many tech founders (Jobs & Woz, Bill and David) had significant contact with the entertainment industry. They decided to run their companies differently and treat the engineers much better, and it worked.
when music thrives so does the world.
Parts I and II represent a very selective, shallow, and misleading treatment of the history of Silicon Valley. Equating early entertainment-related sales with launching HP and Ampex is completely wrong.
Consider the sentence: "Disney placed his order in 1938, which led to the launch of Hewlett-Packard in 1939." No, Hewlett and Packard had discussed starting a company for years, and were bankrolled by their advisor Fred Terman ($538) to form a business. Hewlett had designed an oscillator for his Masters thesis, and Disney Studios placed the first order ($517.50) in 1939.
Another: "The transistor radio, which brought portable music to the mass market, paid the bills to fund the rise of Shockley’s personal business empire and the establishment of a robust semiconductor industry in Silicon Valley." Sony licensed the transistor technology from Bell Labs, where Shockley was employed and he, Brattain and Bardeen demonstrated the first working device. As an employee, Shockley did not receive royalties for this invention. And Shockley did not have a 'personal business empire' - he started Shockley Semiconductor Laboratories with the funding of Beckman Instruments (which was based in L.A., so can be lumped in to the music industry; after all, Shockley went to Hollywood High School!), and completely failed in that business, causing the 'traitorous eight' to defect and form Fairchild Semiconductor, which created the 'robust semiconductor industry in Silicon Valley.' Shockley ended up teaching at Stanford, descending into bizarre race theories and eugenics.
Even the Ampex story is incomplete, ignoring the fact that Bing Crosby had been using audio recorders developed by engineer John Mullin based on German 'Magnetophons' that Mullin, a Army Signal Corps officer, had confiscated at the end of WWII. Mullin rebuilt and demonstrated these systems, and connected Crosby's engineers with Ampex for production of additional units. Ampex was already 3 years old, and was 'funded' by Tomlinson Moseley (who encouraged his employee Alexander Poniatoff to start the company), not Bing Crosby.
Finally, the statement "Jobs learned the ropes in high tech while working at Atari for Nolan Bushnell, who had moved from his native Utah to California because. . . . he wanted to get a job at Disney" is incredibly tortured logic. Bushnell was fascinated with arcade games (which was an industry based in the midwest) and learned about computer games (Spacewar!) while a student at Utah. He came to SV to work at Ampex, but almost immediately started working on what became Pong.
If you want to simplistically assign the role of 'funder of silicon valley' to an entity, you would have much more reason to choose the U.S. Government than the music industry.
Hey Ted. Great article, you make a persuasive case. I had always thought it was US defence spending that helped Silicon Valley develop and hadn’t appreciated the role of the entertainment companies.
Incidentally, have you interpreted the statistic about teenagers correctly? I think it’s saying that 44% of all consumer spending on music was by teenagers, not that teenagers spend 44% of their income on music. The former seems even more impressive to me. I did have to read that chart a few times to make sense of it.
And to think that music in some cultures was and still is sacred. It's a low down dirty shame.
Brilliant observation as always, a great article. I think they have also devalued live music along with recorded music. Just finding somewhere to perform your music is hard enough, let alone getting paid to perform it.
Wow. Thanks again. Much, much food for thought.
I did IT in the publishing industry in the 1990s and left after a few years of banging my head against the wall there for reasons such as some of those mentioned here.
Yet there was another big reason why the media industry couldn't retain tech talent, and it was an ironic one: Hollywood studios aside, many major media companies were based in NYC in proximity to Wall Street. In the 80s and 90s, if you had IT skills, you could work for a bank instead of a publishing, music, or broadcasting company and make up to 2-3x the money. It was simple: while media companies hired IT people and set their salaries in relation to editors, Wall St. firms hired them and set their salaries in relation to bankers and bond traders. This is what happened to me.
Funny thing (or at least, personally amusing) is that Yahoo tried too early and failed. Fond memories of the era when Yahoo went all in on Music, then Hollywood... and as that trickled away, I went on to HP!
What incredible background - as a musician working currently working in the tech industry here in Nashville, this was one of the most inspiring things I've read. The link between art, innovation, & technology is undeniable.
Great article, I've hardly heard anyone voice this point of view, but to my mind, it is completely true. And being able to put it into the historical context of tech companies and entertainment is really interesting. The growth of all entertainment industries are connected at the hip to technology, so it's an important relationship to consider. I can see that some of the current music streaming technology companies are setting up their offices in the most expensive part of town, and its kind of shocking, considering how little musicians are making from their work. It would be good if some arbitrator could come out of bat for the average musician. I have heard a number of times young people say, "oh, touring will pay for that." But COVID has wiped out touring, so there is almost nothing left for a musician. Anyway, thanks for writing this.
Virgin also started in the music biz!!