City of Light: The Story of Fiber Optics

198 CITY OF LIGHT
contracts for single-mode systems—from its manufacturing subsidiary—soon
after MCI, but they spanned only about a fifth the distance. 104 The world’s
biggest phone company already had a massive long-distance network and
was worried about interfacing with existing equipment. MCI could start from
scratch with single-mode fibers.
The MCI contracts marked a turning point in America. Bill McGowan’s
gamble was right on the money; single-mode technology was ready. Gradedindex
fibers lingered for short systems, but almost overnight all the longdistance
companies—including AT&T—switched to single-mode fiber for their
nationwide backbone systems. The change came so fast that Northern Telecom
finished building the loop around Saskatchewan with single-mode fibers
carrying 565 million bits per second. 105
The Corning Patent Wars
As the technology raced forward in the early 1980s, a long-stalled patent
battle came to a head. In 1973, the US Patent Office began issuing a series
of patents to Corning covering fused-silica processes and fiber dopants. As
Corning strategists had intended, the patents essentially controlled access to
the technology; to make communication fibers, you needed the Corning patents.
Cross-licenses exempted Bell from paying royalties, 106 but Corning was
not going to let anybody else get off that easily. Corning filed its first lawsuit
in July 1976, charging ITT with infringing Corning patents in making fiber
it sold to US military agencies.
International Telephone and Telegraph was a logical target because it
looked like it could become a formidable competitor. Standard Telecommunication
Labs was an important technology center; the conglomerate had sent
Charles Kao to head development at its American fiber group. He brought
with him a technique Phil Black had developed at STL to deposit glass soot
inside a tube that could be collapsed into a fiber. Black’s method closely resembled
the process John MacChesney developed at Bell Labs, but his August
1973 application earned ITT a British patent, and the company applied for
an American one. 107 Corning claimed the ITT process infringed its fundamental
patents. It didn’t matter if ITT had devised the process itself, or even if ITT
held a valid patent—Corning insisted that ITT couldn’t make fibers without
using a patented Corning process.
The rest of the industry watched uneasily as lawyers for the two companies
spent years maneuvering for position. They grilled engineers and executives
on both sides. The case threatened to go on forever, but ITT caved in just
before a trial was set to start in 1981. 108 In a consent decree, ITT admitted
infringement, agreed to pay a lump sum penalty, and licensed the Corning
patents. 109 The last-minute decision surprised Black and other observers, who
thought ITT had a good case. 110 However, to win ITT lawyers would have
had to break every applicable claim of every Corning patent involved in the
case. If they failed, Corning could legally refuse to license its patents and shut