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A Mind-blowing Decrease in Communication Costs
Professor Emeritus, College of Education
University of Oregon
I enjoy reading the 50, 100, & 150 Years Ago section of Scientific American. The following is quoted from the August, 2016, issue of Scientific American. It is from an article published 150 years ago, in 1866.
We had occasion to send a
[transatlantic] telegraph message to our correspondent in London,
through the Atlantic Cable, consisting of exactly 20 words, which
according to the published schedule, should have gone forward for £20
sterling, but the director at this end charged £24 or $120 in gold, so
as to cover the date of transmission. We wish the Submarine Telegraph
Company success, but it seems to us impossible that the public will
submit to such exorbitant, and as it appears to us, unreasonable
In 1866, the speed of transmission of this undersea cable was about
eight words per minute, so 24 words was a three-minute message.
Adjusting for inflation, in 2017 dollars the transmission cost about
Today’s Undersea Fiber Optic Cables
Wow, have times changed! Currently, companies such as Amazon,
Facebook, Google, and Microsoft are individually and/or jointly laying
undersea fiber optic cables for use by their customers and business
(Metz, 5/26/2016). An individual fiber in the newest cables transmits
information at 160 terabytes (160 trillion bytes) per second. This is
about 150 trillion times as fast
as the first trans-Atlantic cable that sent messages using Morse code.
A one-inch in diameter cable contains about a half-dozen fibers and
many layers of various types of coating to give it great strength.
To say this in different way, with this speed of transmission, a
half-million different television signals can be transmitted
simultaneously over one fiber.
Call Centers Provide an Interesting Example
Through the use of high-speed, low-cost fiber optics, phone call centers
that serve people in the United States can be located nearly any place
in the world. The cost of such a call is very little. What is
important, and is the main part of the cost, is the knowledge and
language fluency of the call center employee.
I live on the coast in Oregon. Relatively frequently, I engage in a
conversation with a “help” service over my phone or through my
computer. After the helper and I have finished our communication, I
frequently ask, “Where are you located?” The people I am talking with
are often in India, the Philippine Islands, or widely scattered
throughout the U.S.
Here is some data comparing the call center businesses in the Philippines, India, and the U.S. (White, 2/17/2015).
The Philippines has now become the largest offshore voice-related call center market with more than 400,000 call center workers.
India has an estimated employment of 350,000 voice-related call center workers.
It is estimated that there is in excess of 2.2 million workers
employed in more than 6,800 call center facilities across the U.S.
I must admit that I was somewhat surprised, both by these large numbers
of overseas workers and by the number of call center workers in the
U.S. I assume that many of the call center employees in the U.S. are
not performing “help” services, but instead are doing sales work,
polling, and other similar tasks.
In recent years, I have seen considerable improvements in the
computerization of help facilities, so most of my questions first get
filtered through a voice input/output computer system. Usually it is
only with great difficulty that I am able to actually get to talk with
a human being. Remember, it costs a company very little to provide a
computer service that talks to a customer. It is the cost of
human-to-human conversation that is high. The best of today’s
artificial intelligence phone conversation systems are still not very
good in handling customer conversations. Employment Implications of Information and Communication Technology
Besides fiber optics, you know about other rapid and
continuing progress in Information and Communication Technology (ICT).
In addition to improvements in speed, there has been considerable
progress in artificial intelligence. All of this technological progress
has had a major impact in the world of commerce.
In the United States, the Industrial Age officially ended in 1956, when the number of white collar employees first exceeded the number of blue collar
employees. About half of the blue collar jobs were in manufacturing,
but there were a number of other types of blue collar jobs. In my home
state of Oregon, for example, many people worked in the lumber
industry. In this industry, there were many well-paying jobs that
required only a high school degree—or less.
In 1960, about 24-percent of employment in the U.S. was in manufacturing. That has declined to about 9-percent
(Long, 3/29/2016). Two major causes of this change are improvements in
automation and an increase in imports of manufactured goods. Quoting
from Heather Long’s article:
Call it the Great Shift. Workers
transitioned from the fields [farming] to the factories. Now they are
moving from factories to service counters and health care centers. The
fastest growing jobs in America now are nurses, personal care aides,
cooks, waiters, retail salespersons, and operations managers.
This does not mean that most such manufacturing jobs have been shipped
overseas. Instead, improvements in manufacturing processes—considerably
aided by computer technology—have decreased the number of workers, even
while total manufacturing productivity has increased.
Think Robots, Robots, Robots! Quoting from Matthew Rendall (10/9/2016):
There is no denying that the U.S. and
Canada have been losing jobs to offshore competition for almost half a
century. From 2000 to 2010 alone, 5.6 million jobs disappeared.
Interestingly, though, only 13 percent of those jobs were lost due to international trade. The
vast remainder, 85 percent of job losses, stemmed from “productivity
growth” —another way of saying machines replacing human workers. [Bold added for emphasis.]
That is, many jobs have disappeared. But, most of this disappearance
cannot be attributed to an export of manufacturing jobs to other
countries. Quoting from Walter Williams’ article, Is Free Trade Causing
Job Loss? (Williams, 8/17/2016):
It is true that the number of
manufacturing jobs in the United States has been in steep decline for
almost a half-century, but manufacturing employment disguises the true
story of American manufacturing. U.S. manufacturing output has
increased by almost 40 percent. Annual value added by U.S. factories
has reached a record $2.4 trillion. To put that in perspective, if our
manufacturing sector were a separate nation, it would be the seventh
richest nation on the globe.
The point being made is worth repeating. Over a period of 50 years or
so, with only about a third as many workers doing the manufacturing,
the amount of goods manufactured in the U.S. increased by 40 percent.
A number of people have analyzed this situation. Quoting from Four Writers Take On Trump (Muro, January/February 2017).
Boston Consulting Group reports that it
costs barely $8 an hour to use a robot for spot welding in the auto
industry. A human doing the same job costs $25 an hour—and the gap is
only going to widen. The “job intensity” of America’s manufacturing
industries is only going to decline.
It is clear to me that a good education includes:
Gaining knowledge and skills that today’s computers are still far from having. Many of these are what I call people skills.
Gaining relatively broad knowledge and skills in working with
(rather than competing with) computers over a wide range of solving
problems and accomplishing tasks.
Spending less time gaining knowledge and skills in areas where
today’s computers already have capabilities that far exceed those of
Spending more time on learning to learn, becoming a life-long
learner, and learning to adjust to major changes that continue to occur
in the world.
Developing an understanding of quality of life, and
what—personally, and for others—helps to improve quality of life. Here
are four excellent examples: learning and following lifelong habits of
mind and body to maintain and improve mental and physical health;
developing long-lasting, meaningful friendships; developing personally
satisfying hobbies and avocations; and helping to improve the quality
of life of others.
Learning to work in a collaborative, cooperative, group setting
in which people in the group each contribute their unique knowledge,
skills, and abilities as they work to solve problems and accomplish
tasks. We adults know that there is far more to adult life than college
and employment (Moursund, 1/9/2017). And, look back at the second
bulleted item given above. Quite likely computers can be an important
contributor to the group.
Undoubtedly, you can add to the list. Education is not and should not
be a “one size fits all” endeavor, and it has many goals besides those
that guide traditional educational systems.
Moursund is an Emeritus Professor of Education at the University
of Oregon, and editor of the IAE
His professional career includes founding the International Society for
Technology in Education (ISTE) in 1979, serving as ISTE’s executive
officer for 19 years, and establishing ISTE’s flagship publication, Learning and Leading with Technology.
He was the major professor or co-major professor for 82 doctoral
students. He has presented hundreds of professional talks and
workshops. He has authored or coauthored more than 60 academic books
and hundreds of articles. Many of these books are available free
online. See http://iaepedia.org/David_Moursund_Books.
In 2007, Moursund founded Information Age Education (IAE). IAE provides
free online educational materials via its IAE-pedia, IAE Newsletter, IAE Blog, and books. See http://iaepedia.org/Main_Page#IAE_in_a_Nutshell.
Information Age Education is now fully integrated into the 501(C)(3)
non-profit corporation, Advancement of Globally Appropriate Technology
and Education (AGATE) that was established in 2016. David Moursund is
the Chief Executuve Officer of AGATE.