Phoebus cartel

The Phoebus cartel was an international cartel that controlled the manufacture and sale of incandescent light bulbs in much of Europe and North America between 1925–1939. The cartel took over market territories and lowered the useful life of such bulbs.[1] Corporations based in Europe and the United States, including Osram, General Electric, Associated Electrical Industries, and Philips,[2] incorporated the cartel on January 15, 1925 in Geneva,[3] as Phœbus S.A. Compagnie Industrielle pour le Développement de l'Éclairage (French for "Phoebus plc Industrial Company for the Development of Lighting"). Although the group had intended the cartel to last for thirty years (1925 to 1955), it ceased operations in 1939 with the outbreak of World War II. Following its dissolution, light bulbs continued to be sold at the 1,000-hour life standardized by the cartel.

Phoebus cartel
PredecessorInternationale Glühlampen Preisvereinigung
Formation15 January 1925
FoundersOsram, General Electric, Associated Electrical Industries, and Philips among others
Founded atGeneva, Switzerland
Dissolved1939 (1939)
TypeCartel
ProductsIncandescent light bulbs

History

Osram, Philips, Tungsram, Associated Electrical Industries, ELIN, Compagnie des Lampes, International General Electric, and the GE Overseas Group created and joined the Phoebus cartel,[4] holding shares in the Swiss corporation proportional to their lamp sales.

Osram founded a precursor organisation in 1921, the Internationale Glühlampen Preisvereinigung. When Philips and other manufacturers entered the American market, General Electric reacted by setting up the "International General Electric Company" in Paris. Both organisations co-ordinated the trading of patents and market penetration. Increasing international competition led to negotiations among all the major companies to control and restrict their respective activities in order not to interfere in each other's spheres.[5][6]

The Phoebus cartel's compact was intended to expire in 1955, but it was instead nullified in 1940 after World War II made coordination among the members impossible.[6]

Purpose

The cartel lowered operational costs and worked to standardize the life expectancy of light bulbs at 1,000 hours[6] (down from 2,500 hours),[6] while raising prices without fear of competition. The reduction in lifespan has been cited as an example of planned obsolescence,[7] but this has been disputed.[8] The cartel tested their bulbs and fined manufacturers for bulbs that lasted more than 1,000 hours. A 1929 table listed the amount of Swiss francs paid that depended on the exceeding hours of lifetime.[9] Anton Philips, head of Philips, said to another cartel executive, "After the very strenuous efforts we made to emerge from a period of long life lamps, it is of the greatest importance that we do not sink back into the same mire by paying no attention to voltages and supplying lamps that will have a very prolonged life."[6]

Some engineers deemed 1,000 hours a reasonable figure to balance the various operational aspects of an incandescent bulb, since longer lifespan means reduced efficiency (lumens per watt): a longer-life bulb of a given wattage puts out less light (and therefore proportionally more heat) than a shorter-life bulb of the same wattage.[10]

In 1951, the Monopolies and Restrictive Practices Commission in the United Kingdom issued a report to Parliament, which disputed the idea that the Phoebus cartel engaged in planned obsolesence, stating that "there can be no absolutely right life [of light bulbs] for the many varying circumstances to be found among the consumers in any given country, so that any standard life must always represent a compromise between conflicting factors".[8]

In 1949, the United States District Court for the District of New Jersey found General Electric to have violated the Sherman Anti-Trust Act, in part because of their activities as part of the Phoebus Cartel. As part of the decision, while acknowledging that "it should be borne in mind that the life of a lamp is inextricably related to the power of its light", it nonetheless found that profit was General Electric's paramount concern in determining lifespan, and that "by virtue of General Electric's dominating position in the industry and relative lack of competition it had the power to set the standard of efficiency of incandescent electric lamps for the entire industry and in so doing to determine what should be their length of life, and this constitutes an attribute of monopoly".[11]

In Gravity's Rainbow (1973), Thomas Pynchon wrote about "Byron the Bulb", an anthropomorphic eternal lightbulb who fights against the Phoebus Cartel. Pynchon's novel has been credited with bringing the Phoebus Cartel to the public eye.[12][13]

See also

References
  1. MacKinnon, J. B. (2016-07-14). "The L.E.D. Quandary: Why There's No Such Thing as "Built to Last"". The New Yorker. ISSN 0028-792X. Archived from the original on 2017-11-14. Retrieved 2017-11-05.
  2. Metze, Marcel "Anton Philips (1874-1951). They will know who they're dealing with", Uitgeverij Balans, Amsterdam, 2004, ISBN 90 5018 612 2 (Summary) Archived 2014-04-13 at the Wayback Machine.
  3. Feuille officielle suisse du commerce. Berne. February 7, 1925. p. 216.{{cite book}}: CS1 maint: location missing publisher (link)
  4. "Corporations: A Very Tough Baby". Time Magazine. 1945-07-23. Archived from the original on 2009-08-01. Retrieved 2009-04-11.
  5. Jürgen Bönig (1993). Die Einführung von Fliessbandarbeit in Deutschland bis 1933 (in German). LIT Verlag Münster. p. 277. ISBN 3894731117. Archived from the original on 2016-07-01. Retrieved 2016-05-03.
  6. Markus Krajewski (24 September 2014). "The Great Lightbulb Conspiracy". IEEE Spectrum. Archived from the original on 29 October 2017. Retrieved 3 November 2017.
  7. https://www.europarl.europa.eu/RegData/etudes/BRIE/2016/581999/EPRS_BRI(2016)581999_EN.pdf
  8. Monopolies and Restrictive Practices Commission (1951). Report on the Supply of Electric Lamps (PDF). London: His Majesty's Stationery Office. p. 98. ISBN 010518487X. Archived (PDF) from the original on 2019-09-05. Retrieved 2020-04-14.
  9. Peretti, Jacques (July 2014). "The Men Who Made Us Spend, Episode 1". BBC. Archived from the original on 2014-07-07. Retrieved 2014-07-10.
  10. Hehkulampussa ja ledissä sama ongelma: lämpö Archived 2011-10-15 at the Wayback Machine, Suomen Kuvalehti 13.10.2011, an interview of research scientist, D.Sc. Eino Tetri, Leader of the Light Sources and Energy Group in Aalto University
  11. United States v. General Electric Co. et al., F.Supp. 753 (D.N.J. 1949).
  12. "The Story Behind the Story Behind "The Great Lightbulb Conspiracy" - IEEE Spectrum".
  13. "The Phoebus Cartel : Planet Money". NPR. Archived from the original on 2023-02-08.

Further reading
This article is issued from Wikipedia. The text is licensed under Creative Commons - Attribution - Sharealike. Additional terms may apply for the media files.