Rapidly Changing Phonograph Technology
In the late 1890s, Johnson had developed another disc-recording method using Berliner’s lateral recording technique, but with a soft-wax master disc instead of a zinc disc. From the wax master, Johnson produced a metal stamper, which was used to produce the shellac-based records. Johnson believed the zinc master discs caused the scratchy sound in Berliner’s shellac discs. Berliner apparently never pursued wax masters, figuring they would infringe on the Bell-Tainter patent for producing wax master cylinders.
After the injunction on Berliner’s gramophone was lifted, Johnson seized the opportunity to market a new gramophone, which played shellac discs derived from wax masters. The sound produced by Johnson’s machine was better than Berliner’s. Johnson wagered his remaining savings on a risky promotional campaign and managed to generate public enthusiasm. The new market entrant aroused the ire of Seaman, the original sales agent for Berliner’s gramophone, who was now selling another disc player not affiliated with Berliner. Seaman sued Johnson, claiming that Johnson’s Consolidated Talking Machine Company was nothing more than a thinly veiled Berliner Gramophone Company.
The court did not agree. In 1901, Johnson won a stunning victory in Philadelphia. He was free to sell his improved gramophone as long as he did not use Berliner’s “gramophone” name. No matter. The word soon disappeared from the American vernacular, as disc-playing machines overtook cylinder machines and also became known generically as phonographs. During the court case, Johnson had stayed on good terms with Berliner and paid royalties for Berliner’s patent for lateral disc recording. Johnson, however, had clearly advanced the concept by developing an improved spring motor and the wax master. Johnson merged with the Berliner organization, which acquired 40 percent of Johnson’s company. Johnson now owned Berliner’s original gramophone patent. He also created a new company name inspired by his “victory” in court: the Victor Talking Machine Company, which would become the dominant phonograph and record manufacturer over the next three decades.
But soon after Victor Talking Machine Company was formed, Johnson was handed the shock of his life. In December 1901, the U.S. Patent Office awarded one Joseph W. Jones a patent for the lateral engraving of wax master discs, the same basic process already being commercialized by Johnson. Johnson, like Berliner, had not originally sought to patent his method, figuring the original Bell-Tainter patent covered all types of wax recording.
This time, Johnson was outsmarted. In 1896, Jones had handled basic chores in Berliner’s Washington, D.C., laboratory when Berliner experimented with wax discs. Jones took good notes. In 1897, he filed a claim for laterally engraving a groove of even depth on a wax blank master, which the U.S. Patent Office accepted four years later. Meanwhile, Johnson’s nearly identical patent was filed in 1898 and accepted in 1905, years after his machine hit the market. Jones had no phonograph for sale, just a legal document from the U.S. Patent Office that caused Johnson headaches for years.
Enter once again Columbia attorney Mauro, still fuming from his failure to stop the Berliner gramophone. With Victor Talking Machines overtaking the original cylinder machines, Columbia desperately wanted to produce its own disc player. Mauro snatched up the Jones patent for $25,000, and in 1902 Columbia began selling the Columbia Disc Graphophone.
Johnson was livid. But as Victor prepared to battle Columbia in the courts for patent infringement, cooler heads prevailed, and the two companies agreed to pool their patents in 1902. Collectively, Victor and Columbia now owned all key aspects of manufacturing disc machines and lateral-cut records. Victor and Columbia had essentially monopolized the disc recording industry.
Victor, maker of the Red Seal Record, moved to take the market for classical music discs by signing exclusive contracts with the opera giants, most notably the tenor Enrico Caruso. In 1908 Columbia introduced the first double-sided discs and signed up a slew of opera singers and stage entertainers. Despite Columbia’s headway, Victor maintained the industry lead. Besides, the Victor-Columbia lock on America’s booming disc phonograph market allowed both companies to reap fortunes. By 1912, Columbia’s disc business was firmly established as its cylinder business waned. Columbia soon dropped its cylinder machine, thus leaving Edison the last industrial titan committed to his original invention.
Yet even Edison’s people weakened. In 1910, they began secretly exploring a disc-playing phonograph. Two years later, Edison introduced his Diamond Disc Phonograph. Where Columbia and Victor phonographs played only lateral-cut discs, Edison’s phonograph played only vertical, “hill-and-dale,” Edison-brand discs. The vertical-cut disc employed the original engraving technology developed by Edison decades before for his cylinder machines.
By 1915, the stage was set for new competitors in the phonograph industry. For one thing, several basic patents related to the manufacture of phonograph machines had expired. Even though Victor and Columbia’s lateral-cut records and companion phonograph machines dominated the market, Edison’s vertical-cut discs and Diamond Disc Phonographs created a commercial opportunity for a second method for recording discs that was less safeguarded by patents. Finally, with both lateral-cut and vertical-cut records now on the market, enterprising companies saw potential for developing phonographs with tone arms that could play both types of records.
Enter Henry Gennett’s Starr Piano. With an army of skilled wood craftsmen in Richmond and an established chain of music stores, Starr Piano was a natural for the phonograph business. Tooling in the Richmond factory was well suited for producing wooden phonograph cabinets and the necessary metal fabrications. By 1916, Starr Piano manufactured and retailed in the company stores a Starr brand phonograph that played both vertical-and lateral-cut discs simply by changing the needle’s position.
Starr Piano was not alone. Six new companies entered the phonograph business in 1914. A year later, another half-dozen or so threw their hats into the ring. By 1916, there were close to fifty phonograph makers. Yet, this increased competition did not materially affect Victor; its assets grew from $13.9 million in 1913 to $21.6 million in 1915. By 1916, more than half a million phonographs were being sold across the country, a number that would quadruple in three years.
In addition, in 1916, Starr Piano established a record division to produce discs for the Starr phonographs. Ever the dealmaker, Henry Gennett bought into the recording business after acquiring recording equipment and a stack of vertical-cut masters from a bankrupt Boston company. He set up a primitive recording studio in Starr Piano’s new office at 9–11 East Thirty-Seventh Street in New York City. The company began recording discs, using the vertical-cut technology developed by Edison. The records bore either green or blue Starr labels and were sold with the phonographs in the Starr retail stores.
Initially, Starr records were pressed by a custom pressing outfit, most likely the Scranton Button Works in Scranton, Pennsylvania, which offered record pressing as early as 1915. By 1917, Starr Piano had constructed a six-story phonograph manufacturing and record-pressing facility in Starr Valley in Richmond. Starr Piano’s Manhattan recording studio, with access to the city’s marching bands, orchestras, and stage entertainers, produced the bulk of master discs that were used to press records on the Starr label at the Richmond facility. In 1921, the Gennett family established a second recording studio in Starr Valley in a single-story building along a row of Starr factory buildings.
Despite the plethora of new phonograph companies, the dominance by Victor and Columbia remained virtually invincible. New phonograph and record manufacturing firms, thrown together by eager investors between 1915 and 1920, often shut down as quickly as they opened. First of all, Victor threatened to slap lawsuits on anyone who attempted to produce records using the more popular lateral-cut method. Equally hard to crack was consumer loyalty to the superior Columbia, Victor, and Edison products, not to mention their established network of retail outlets and exclusive distributorships.
The smaller phonograph and record companies that did survive in this environment were generally divisions of large manufacturers of furniture products with established retail access. By the 1910s, the conspicuous tin horns on the first phonographs were hidden inside stylish cabinets. Phonographs, right along with the piano, were increasingly regarded as desirable pieces of furniture. The early phonographs and their companion records were sold together in furniture and department stores, as well as in music stores. For example, the department stores carrying Edison Diamond Needle Phonographs sold them right along with the Edison discs, and the same approach applied to Columbia and Victor.
Likewise, Starr Piano’s network of stores sold Starr phonographs along with an undistinguished selection of popular and classical records on the Starr label at prices ranging from $.65 to $1.00. The Aeolian Company, a leading manufacturer of pianos and organs, produced the Aeolian-Vocalion phonograph and vertical-cut Vocalion records. Wisconsin Chair Company built phonograph cabinets for Edison before it began selling its own phonographs as a sideline in 1915. Within two years, Wisconsin Chair introduced its Paramount record label. The General Phonograph Company, financed by a mighty German firm, the Lindstrom Company, issued the OKeh record label. Brunswick-Balke-Collender, known for billiard and bowling equipment, also produced phonographs and records.
These leading manufacturers entered the phonograph and record business just as manufacturers began riding the 1917–18 industrial boom created by American involvement in World War I. Companies with advanced mass-production capabilities soon became part of the American war machine. Edison’s factories, for example, were engaged in the mass production of wooden rifle parts. Starr Piano took advantage of its forty-mile proximity to Dayton, Ohio, where warplanes were being built near the Wright brothers’ historic airplane factory. The Gennett family secured major government contracts for the production of propellers, flaps, rudders, and wooden supports for aircraft wings, as well as accessories for hot-air balloons. The war created a peculiar situation for the many German craftsmen at Starr Piano, who were now producing parts for a war against their old homeland. (While government contracts were a financial boon for Starr Piano, U.S. aircraft contributed little to the Allied war effort. American aviation had advanced marginally beyond the original Wright Flyers of the 1900s, and American-made aircraft were not involved in the legendary dogfights over Europe.)
As the end of World War I approached, Starr Piano was near its industrial peak. Starr pianos continued to sell in huge quantities, while Starr phonographs rode the general wave of popularity for the newest gadget in home entertainment. But the Gennett family was forced to reassess the Starr record label, which faced hurdles beyond the Victor-Columbia lock on the market.
For one, Starr records were only sold with Starr phonographs in the Starr stores. Independent dealers hesitated selling records with a name so strongly associated with Starr pianos. For retailers carrying other brands of pianos, Starr records presented a potential conflict of interest. Worse, Starr records were vertical-cut. These records were a losing proposition because they could not be played on the ubiquitous Victor and Columbia phonographs, which played only lateral-cut records. Of the vertical-cut discs, only the Edison discs made respectable market inroads.
So Henry Gennett and his sons took bold measures. On the urging of his youngest son, Fred, the family in 1917 created the Gennett label, thereby minimizing the association with the piano company in order to widen the label’s distribution base. The Gennett family now could more easily strike deals with independent distributors. Ultimately, the Starr Piano name only appeared in fine print at the bottom of the record label. The first records issued under the new ornately lettered Gennett label were a series of classical discs.
Then Gennett made a second, even more fortuitous, move. In 1919, the company introduced lateral-cut discs for $.85 apiece, without paying a licensing fee to Victor for the patented recording technology. It was a direct and dangerous assault by little Gennett Records on the recording titan. That year, in issues of Talking Machine World, a leading phonograph trade magazine, Starr Piano advertised that its Gennett records could improve the tone of all phonographs. The not-so-subtle message was that Gennett’s new lateral-cut discs could be played on the prominent Victor and Columbia phonographs.
As expected, in 1919 Victor Talking Machine sued Starr Piano in the United States District Court for the Southern District of New York, charging infringement of Johnson’s patent. In addition, Victor sought a temporary injunction against Starr Piano to cease production of the Gennett lateral-cut records until the case was settled. On the surface, the confrontation resembled the battle between David and Goliath. Besides its enormous financial resources and a file cabinet full of U.S. patents for recording technology, Victor had a long and impressive track record in winning patent infringement suits. Victor’s Eldridge Johnson had successfully defended his 1905 patent for the lateral-cut recording process in several cases, including a 1911 court decision in which Johnson’s patent was ruled valid over the nearly identical Jones patent of 1901!
The Gennett family, on the other hand, had no patents to wave back in Victor’s face. Their defense was lack of invention on the part of Johnson’s patent. In other words, they argued that the general concept of lateral-cut recording belonged in the public domain and should not be protected by a series of confusing and often contradictory patent rulings. Once and for all, the Gennetts were determined to break the monopoly.
The Gennett family had another factor in its favor. In similar cases, the courts often rendered decisions totally inconsistent with previous rulings. In the early days of the record business, any outcome was possible when phonograph-related patents were at issue. And while Gennett Records was a tiny player in a business ruled by Victor, the Richmond parent company of Starr Piano was booming and had the financial clout to handle protracted litigation with just about anyone.
Also, Starr Piano was not on its own. The company received enthusiastic support from other small record companies – General Phonograph (OKeh), Aeolian Company (Vocalion), Brunswick-Balke-Collender Company (Brunswick), and Canadian Compo Company. They joined Starr Piano in the suit. None of them had made substantial inroads with vertical-cut records, and all stood to gain enormously from free access to the lateral-cut recording technology. Starr Piano hired a veteran patent lawyer, Drury W. Cooper, to defend the case, one that would break forever the cozy Victor-Columbia lock on the lateral-cut recording industry.
In early 1920, Victor suffered its first setback when both the U.S. District Court and the U.S. Circuit Court of Appeals denied the temporary injunction. When a patent in question has been held valid in an earlier ruling, as was the case with the Johnson patent, a temporary injunction is usually granted. Not this time. Starr Piano’s attorneys effectively attacked the validity of Johnson’s patent in view of the earlier 1901 Jones patent. Even though Johnson’s patent had been successfully defended in court in the past, Starr Piano cited rulings surrounding the Johnson patent that appeared contradictory.
In refusing to issue a temporary injunction against Starr Piano, the Circuit Court of Appeals in January 1920 noted that possibly “Jones had a prior patent and was a prior inventor. If so, it then became incumbent upon Johnson, in order to succeed, to prove beyond a reasonable doubt that he was, in fact, the inventor.” The court added that because of the questionable correctness of previous cases, the case should be moved for an early trial. Starr Piano’s opening-round victory enabled the company to continue pressing lateral-cut discs, knowing that final settlement of Victor’s impending patent infringement suit would be held up in court for months, possibly years.
The prominent U.S. District Court Judge Learned Hand presided over Victor Talking Machine v. Starr Piano, which began in 1920 and dragged on several months into early 1921. During the testimony, Starr Piano’s attorneys hauled motion picture equipment into the courtroom for close-up observation of the Gennett recording stylus and the grooves it cut into wax master discs. “At the trial, witnesses appeared who had been brought from Europe, and practically all the experts in the art contributed their information for the consideration of the judge,” Starr Piano wrote in a press statement. After months of technical badgering, Starr Piano’s original defense, which had buried Victor’s temporary injunction, proved convincing to Judge Hand. In a decree issued on February 11, 1921, Judge Hand concluded that Victor’s attorneys could not prove that Johnson had invented the concept of lateral-cut recording on a wax master disc.
Hand acknowledged that certain tools and methods relating to lateral-cut recording had been developed and legitimately patented by Victor. But the general concept, he concluded, existed years before Johnson’s patent. Judge Hand also ruled that Victor had legally “abandoned” Johnson’s patent, because the lateral-cut recording process had been in commercial use several years before the patent was awarded.
The final crushing blow in the dispute was handed down on April 4, 1922, in the U.S. Circuit Court of Appeals, where Judge Augustus Hand (a cousin of Learned Hand) massacred the once-intimidating Johnson patent. He agreed that Johnson’s keeping his patent secret for several years constituted abandonment. Then, after assessing numerous recording patents leading up to Johnson’s own, Judge Hand affirmed that previous inventors were already familiar with the concept of lateral-cut recording:
The most that can be said of the Johnson patent suit is that it disclosed a method of cutting out a lateral undulatory groove of substantially constant depth by an improved form of stylus. Everything except the improved tool which his specification discloses seems to have been old, and the improved tool was apparently a matter of workmanship, and at any rate is not an element in the claims in suit.
Augustus Hand ruled that Johnson’s patent for lateral-cut recording was directly foreshadowed by Jones’s patent, and even earlier by Bell and Tainter’s nineteenth-century patent for recording with a soft wax cylinder! “Nothing remained but work for skilled artisans in order to fabricate a satisfactory sound record,” Hand wrote. “Nothing was achieved worthy of a patent in producing the Johnson matrix. It seems evident that Johnson invented nothing new in the way of a matrix laterally cut out of wax, and that he did not think that he had done so. He, at most, by more experienced workmanship, produced better results through methods that were undoubtedly older than had formerly been secured.”
The piano company from Indiana soundly defeated mighty Victor. Fred Gennett wasted no time in issuing a press statement: “The history of this case is almost three years of continued and intense litigation, an embraced in its scope the entire art of record making from its first inception to the point whereby this decision restricting patents was broken and the manufacture of records become public property.”