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begin quoteThe authors have managed to document the technical history accurately while capturing the entrepreneurial color of one of the most interesting and prolific eras in Silicon Valley history.end quote

- Audrey MacLean, Co-Founder of N.E.T. and Consulting Professor, Stanford University

Circuits, Packets, and Protocols

Entrepreneurs and Computer Communications, 1968-1988

Book Cover of Circuits, Packets, and Protocols

Now available in hardback, paperback, and digital!

About the Book

Circuits, Packets, and Protocols tells the story of the engineers, entrepreneurs, investors, and visionaries who laid the groundwork and built the foundations of the Internet.

In the late 1960s, two American corporate behemoths were poised to dominate the rapidly converging industries of computing and communications—the computer giant, IBM, and the regulated telecommunications monopoly, AT&T. But in 1968, a key ruling by the Federal Communications Commission gave small businesses a doorway into an emerging market for communication devices that could transmit computer data over telephone lines. In the two decades that followed, an industry of networking technology emerged that would impact human history in profound and unfathomable ways.Circuits, Packets, and Protocols is a groundbreaking study of the men and women in the engineering labs, board rooms, and regulatory agencies whose decisions determined the evolution of our modern digital communication networks.Unlike histories that glorify the dominant players with the benefit of hindsight, this is a history of a pivotal era as it happened. Drawing on more than 80 interviews recorded in 1988, the book features insights from now-famous individuals such as Paul Baran, JCR Licklider, Vint Cerf, Louis Pouzin, and Robert Metcalfe.Inspired by innovations from government-sponsored Cold War defense projects and the birth of the modern venture capital industry, these trailblazers and many others built the technologies and companies that became essential building blocks in the development of today’s Internet. Many of the companies and products failed, even while they helped propel the industry forward at breakneck speed.Equal parts academic history and thrilling startup drama, Circuits, Packets, and Protocols gives the reader a vivid picture of what it was like to take part in one of the most exciting periods of technological advance in our time.

Advance Praise

for Circuits, Packets, and Protocols

The key technologies that brought us our modern networked society—routers, packet switching, multiplexers, Internet protocols—were all invented by people in the short period between 1968 and 1988. James Pelkey interviewed these people at that time and recorded their stories. This book is the result: a detailed and up-close personal history of a world being born. Fascinating.

- W. Brian Arthur, Author of The Nature of Technology: What It Is and How It Evolves

Circuits, Packets, & Protocols is a masterpiece of scholarship—of a rare and beautiful kind. Pelkey, Robbins, and Russell have given the historical world a treasure, one that is unexpected and vital for a fundamental pivot-point in technology and its impact on world history.

- Chuck House, Founder and CEO, InnovaScapes Institute

A marvelous and personal exploration of a poorly documented period in the history of data communication! I lived through it and re-lived it in these interviews and narrative.

- Vint Cerf, Internet Pioneer

The authors take you on an astounding journey into the origins of the Digital Revolution. They help you understand how the entrepreneurs, technicians, bureaucrats, and the military cooperated, competed, and finally succeeded in creating some of the most interesting electronic dimensions of our modern society.

- Louis Galambos, The Johns Hopkins University

Circuits, Packets, & Protocols is one of the most detailed accounts of the 1980s that I have seen. The authors have managed to document the technical history accurately while capturing the entrepreneurial color of one of the most interesting and prolific eras in Silicon Valley history.

- Audrey MacLean, Co-Founder of N.E.T. and Consulting Professor, Stanford University

Circuits, Packets, & Protocols is not all about “winners” but includes the story of “losers” as well, and what can be learned from failures as well as successes. If you wonder whether there was a one-time confluence of events that brought us to the Digital Age, or a pattern we can learn from and pursue, this book will help you decide.

Elizabeth (Jake) Feinler, Director of Network Information Systems Center, Stanford Research Institute, 1972-1989

The Internet didn’t happen overnight. It was the product of a set of quiet and diverse engineering efforts that took place over two decades long before the Internet became America’s digital Main St. Circuits, Packets, & Protocols tells that story.

- John Markoff, Author and Fellow, Stanford Institute for Human-Centered Artificial Intelligence

Circuits, Packets, & Protocols is full of revelations for me even though I was there. Never had it explained so clearly how my distributed computing strategy was the wrong one for 3Com in the 1980s.

- Bob Metcalfe, Internet pioneer, Ethernet inventor, 3Com founder, UT Austin Professor of Innovation

The key technologies that brought us our modern networked society—routers, packet switching, multiplexers, Internet protocols—were all invented by people in the short period between 1968 and 1988. James Pelkey interviewed these people at that time and recorded their stories. This book is the result: a detailed and up-close personal history of a world being born. Fascinating.

- W. Brian Arthur, Author of The Nature of Technology: What It Is and How It Evolves

Circuits, Packets, & Protocols is a masterpiece of scholarship—of a rare and beautiful kind. Pelkey, Robbins, and Russell have given the historical world a treasure, one that is unexpected and vital for a fundamental pivot-point in technology and its impact on world history.

- Chuck House, Founder and CEO, InnovaScapes Institute

A marvelous and personal exploration of a poorly documented period in the history of data communication! I lived through it and re-lived it in these interviews and narrative.

- Vint Cerf, Internet Pioneer

The authors take you on an astounding journey into the origins of the Digital Revolution. They help you understand how the entrepreneurs, technicians, bureaucrats, and the military cooperated, competed, and finally succeeded in creating some of the most interesting electronic dimensions of our modern society.

- Louis Galambos, The Johns Hopkins University

Circuits, Packets, & Protocols is one of the most detailed accounts of the 1980s that I have seen. The authors have managed to document the technical history accurately while capturing the entrepreneurial color of one of the most interesting and prolific eras in Silicon Valley history.

- Audrey MacLean, Co-Founder of N.E.T. and Consulting Professor, Stanford University

Circuits, Packets, & Protocols is not all about “winners” but includes the story of “losers” as well, and what can be learned from failures as well as successes. If you wonder whether there was a one-time confluence of events that brought us to the Digital Age, or a pattern we can learn from and pursue, this book will help you decide.

Elizabeth (Jake) Feinler, Director of Network Information Systems Center, Stanford Research Institute, 1972-1989

The Internet didn’t happen overnight. It was the product of a set of quiet and diverse engineering efforts that took place over two decades long before the Internet became America’s digital Main St. Circuits, Packets, & Protocols tells that story.

- John Markoff, Author and Fellow, Stanford Institute for Human-Centered Artificial Intelligence

Circuits, Packets, & Protocols is full of revelations for me even though I was there. Never had it explained so clearly how my distributed computing strategy was the wrong one for 3Com in the 1980s.

- Bob Metcalfe, Internet pioneer, Ethernet inventor, 3Com founder, UT Austin Professor of Innovation

The key technologies that brought us our modern networked society—routers, packet switching, multiplexers, Internet protocols—were all invented by people in the short period between 1968 and 1988. James Pelkey interviewed these people at that time and recorded their stories. This book is the result: a detailed and up-close personal history of a world being born. Fascinating.

- W. Brian Arthur, Author of The Nature of Technology: What It Is and How It Evolves

Circuits, Packets, & Protocols is a masterpiece of scholarship—of a rare and beautiful kind. Pelkey, Robbins, and Russell have given the historical world a treasure, one that is unexpected and vital for a fundamental pivot-point in technology and its impact on world history.

- Chuck House, Founder and CEO, InnovaScapes Institute

The Internet didn’t happen overnight. It was the product of a set of quiet and diverse engineering efforts that took place over two decades long before the Internet became America’s digital Main St. Circuits, Packets, & Protocols tells that story.

- John Markoff, Author and Fellow, Stanford Institute for Human-Centered Artificial Intelligence

Circuits, Packets, & Protocols is full of revelations for me even though I was there. Never had it explained so clearly how my distributed computing strategy was the wrong one for 3Com in the 1980s.

- Bob Metcalfe, Internet pioneer, Ethernet inventor, 3Com founder, UT Austin Professor of Innovation

A marvelous and personal exploration of a poorly documented period in the history of data communication! I lived through it and re-lived it in these interviews and narrative.

- Vint Cerf, Internet Pioneer

The authors take you on an astounding journey into the origins of the Digital Revolution. They help you understand how the entrepreneurs, technicians, bureaucrats, and the military cooperated, competed, and finally succeeded in creating some of the most interesting electronic dimensions of our modern society.

- Louis Galambos, The Johns Hopkins University

Circuits, Packets, & Protocols is one of the most detailed accounts of the 1980s that I have seen. The authors have managed to document the technical history accurately while capturing the entrepreneurial color of one of the most interesting and prolific eras in Silicon Valley history.

- Audrey MacLean, Co-Founder of N.E.T. and Consulting Professor, Stanford University

Circuits, Packets, & Protocols is not all about “winners” but includes the story of “losers” as well, and what can be learned from failures as well as successes. If you wonder whether there was a one-time confluence of events that brought us to the Digital Age, or a pattern we can learn from and pursue, this book will help you decide.

Elizabeth (Jake) Feinler, Director of Network Information Systems Center, Stanford Research Institute, 1972-1989

Table of Contents Sample

  • Introduction
  • Chapter 1 - Prelude to Change: Data Communications, 1949-1968
  • Chapter 2 - Onset of Competition: Data Communications, 1968-1972
    • 2.1 Overview
    • 2.2 Government and AT&T
      • 2.2.1 Computer Inquiry I
      • 2.2.2 MCI and Carterfone
      • 2.2.3 William McGowan and MCI
    • 2.3 IBM and Computing
      • 2.3.1 Mainframe Computers and Time-Sharing
      • 2.3.2 Mainframe Market-Structure
      • 2.3.3 Unbundling Software and Services
      • 2.3.4 Minicomputers
    • 2.4 Early Data Communications Leaders: 1968-1969
      • 2.4.1 Codex
      • 2.4.2 Milgo
      • 2.4.3 Codex
      • 2.4.4 ADS
    • 2.5 A Swarm of Data Communications Start-ups: 1968-1970
      • 2.5.1 Infotron
      • 2.5.2 General DataComm
      • 2.5.3 Timeplex
      • 2.5.4 Paradyne
      • 2.5.5 Vadic
      • 2.5.6 Universal Data Systems
      • 2.5.7 Intertel
    • 2.6 1970: A Pivotal year for Codex and ADS
      • 2.6.1 Codex
      • 2.6.2 ADS
    • 2.7 The Creation of the IDCMA
    • 2.8 Strategic Partnerships in the Data Communications Market-Structure: 1971-1972
  • Chapter 3 - Packet Switching and ARPANET: Networking, 1959-1972
  • Chapter 4 - Market Order: Data Communications, 1973-1979
  • Chapter 5 - Protocol Confusion: Networking,1972-1979
  • Chapter 6 - Emergence of Local Area Networks: Networking, 1976-1981
    • 6.1 Overview
    • 6.2 Early Networking Pioneers
    • 6.3 Select Computer Companies Introduce LANs, 1976-1978
      • 6.3.1 Prime Computer
      • 6.3.2 MIT—The Laboratory of Computer Science
      • 6.3.3 Digital Equipment Corporation
      • 6.3.4 Zilog
      • 6.3.5 The Return of Venture Capital
    • 6.4 Early LAN Start-ups
      • 6.4.1 Robert Metcalfe and the Founding of 3Com
      • 6.4.2 Michael Pliner and the Founding of Sytek
      • 6.4.3 Ralph Ungermann, Charlie Bass, and the Founding of Ungermann-Bass
    • 6.5 Data Communications Companies Respond with the Data PBX
      • 6.5.1 Micom: The Data PBX and IPO
      • 6.5.2 Codex: The Data PBX, 1977-1981
    • 6.6 Early LAN Start-ups Struggle, 1980-1981
      • 6.6.1 Sytek: A Broadband Network and a Need for Cash
      • 6.6.2 Ungermann-Bass: Xerox, Broadband, and Chips
      • 6.6.3 3Com: Product Strategy in Anticipation of a PC
    • 6.7 The Emergence of the Networking Market-Structure
    • 6.8 In Perspective
  • Chapter 7 - The Chaos of Competition: Networking, 1981-1982
  • Chapter 8 - The Need for Standards: Networking, 1975-1984
  • Chapter 9 - Market Order: Networking, 1983-1986
  • Chapter 10 - Adaptation of Wide Area Networks: Data Communications, 1979-1986
  • Chapter 11 - Market Consolidation: Data Communications and Networking, 1986-1988
  • Chapter 12 - Government Support for Internetworking, 1983-1988
  • Chapter 13 - The Emergence of Internetworking, 1985-1988
    • 13.1 Overview
    • 13.2 Interconnecting Local Area Networks
      • 13.2.1 Repeaters and Hubs: Physical Layer Solutions for Extending a Network
      • 13.2.2 Bridges: Connecting the Data Link Layer
      • 13.2.3 Gateways and Routers: Integrating Countless Networks at the Network Layer
    • 13.3 Internetworking: Entrepreneurs and Start-Ups, 1985-1988
      • 13.3.1 Hub Companies
      • 13.3.2 Vitalink Communications Corporation
      • 13.3.3 Retix
      • 13.3.4 Wellfleet Communications
      • 13.3.5 Cisco Systems
    • 13.4 Internetworking: Public Demonstrations in 1988
      • 13.4.1 Hub Companies
      • 13.4.2 Vitalink Communications Corporation
    • 13.5 Internetworking Market-Structure
    • 13.6 In Perspective
  • Chapter 14 - Conclusions
  • Appendix A - List of Interviews
  • Appendix B - Bibliography
  • Appendix C - Timeline

Sample from Chapter 2

Onset of Competition: Data Communications, 1968-1972

A Swarm of Data Communications Startups: 1968-1970

The period of 1968-1970 saw the founding of dozens of new data communications companies. This Schumpeterian swarm was a sure sign of the start of the competition stage of a market-structure. In many cases, these startups were founded by engineers who left companies that had recently been acquired by larger companies where the prospects for innovative and stimulating work were lacking. In several instances these new companies started out as OEM manufacturers for Western Union. What follows briefly are the early histories of the entrepreneurs of seven other leading firms in data communications formed between 1968-1970.

Vadic

In early 1969, Kim Maxwell and six others founded Vadic, one of dozens of companies that would jump into the dial-up modem business. At first, Vadic planned to develop both control systems and modems because they had one person who knew a little about each. But soon they realized they needed more focus and collectively decided it would be modems. After realizing the opportunity that had developing from the Carterfone decision, Maxwell remembers asking potential customers: “‘What kind of modems would you like?’ Well, people said things like Bell 103s. So we decided we better go find out what a 103 was. We bought the technical book from AT&T and we read through it. Now that tells you the level of knowledge and sophistication of this company that created the dial-up modem business.” Within a few years, Vadic would challenge AT&T as the leading innovator of dial-up modems.

Universal Data Systems

In 1969, Mark Smith, an engineer with SEI Systems, a government contractor, realized he did not want to work in an engineering job shop forever: he wanted to create products to sell. He too began reading about Carterfone. Knowing nothing about modems, he contacted Bell South to speak to a modem salesman. Smith remembers: “When the, quote, ‘salesman’ came out and explained to me the reason that AT&T’s unit was more expensive and five times as big as the other units that were starting to show up on the market was that it had more resistors and capacitors in it, I figured that this might be a good business opportunity.

Sample from Chapter 6

Emergence of Local Area Networks: Networking, 1976-1981

6.1 Overview

In the late 1970s, the second major market-structure of computer communications emerged: networking. For over a decade it co-evolved with, and finally eclipsed, the data communications market-structure before the two influenced the emergence and evolution of the third market-structure of computer communications: internetworking. By the end of this book, in 1988, total revenues for the three industries combined were over $5 billion. In the early 1970s, several pioneering engineers began to apply recent learning in the field of networking to innovate the use of networks for their employers’ in-house productivity, or as solutions to meet specific customer needs. But while these pioneers proved the technology could work, it would take until the end of the decade before the commercial success of networks could be validated in the market. By then, the explosion in business computing—mainframes and the increasingly popular minicomputer—had created a compelling need to connect computers to other computers, peripherals, and terminals throughout the enterprise. Customers began making demands on their vendors for connectivity. This demand was on display in May of 1979 at the Local Area Computer Networking symposium presented by MITRE and the National Bureau of Standards (NBS). The result was a watershed moment for the emerging market, which, when combined with the resurgence of venture capital, provided entrepreneurs with the right mix of opportunity and resources. Just one month later, in June, three of the leading networking companies, 3Com, Ungermann-Bass, and Sytek, were founded. Each differentiated to take advantage of what they saw as a unique market opportunity. They quickly discovered they did not have the market to themselves, as the existing data communication firms saw the same market signals and responded with products of their own.

About the Authors

James L. Pelkey

James L. Pelkey

James L. Pelkey spent his career as an investor and executive, including terms as a general partner at Montgomery Securities, President of Sorcim Corporation and Digital Sound Corporation, and, after his retirement, Trustee and Chairman of the Santa Fe Institute. He is a graduate of Rensselaer Polytechnic Institute (1968) and Harvard Business School (1970). He now lives in Maui, Hawai´i.

Andrew L. Russell

Andrew L. Russell

Andrew L. Russell is Professor of History and Dean of the College of Arts & Sciences at SUNY Polytechnic Institute in Utica, New York. He is the author of numerous books and articles on the history of technology, standardization, and innovation, including Open Standards and the Digital Age: History, Ideology, and Networks (Cambridge University Press, 2014), and co-author with Lee Vinsel of The Innovation Delusion: How Our Obsession with the New Disrupts the Work That Matters Most (Currency, 2020).

Loring G. Robbins

Loring G. Robbins

Loring G. Robbins is a freelance writer and marketing consultant based in the San Francisco Bay Area. Previously, he worked as an animator and animation director for several media startups.