Railroads, watches and digital movies
Dancing into the ravine
Back in 1886, Richard Warren Sears was working as an agent-telegrapher at a railroad line in Minnesota. A shipment of 2500 gold pocket watches arrived at the station where he worked. As no one had asked for them and nobody wanted, he decided to buy them all. He then offered the watches to their railroad colleagues using the telegraph… and sold them all at $14, earning $2per clock. $5000 profit, clean… in 1886.
The success of the sale was in Richard’s ability to observe and recognize opportunities: at the time, late nineteenth century, pocket watches were considered a sign of urban sophistication. Moreover, due to the recent connection of both American coasts by the iron horse, a new concept which was applied a few years ago in England, was implemented there too: time zones.
Already in 1840, British Great Western Railway synchronized, for the first time in history, a series of local times in different towns of England with a standard time, Greenwich Mean Time.
Ten years later, what in England was known as Railway time, started do be implemented in America, to set and synchronize the five rail lines that crossed all the continent, coast to coast.
Among the labour need for rail operators to use new and more accurate clocks, and these watches being considered a luxury and a provider of social status to the inhabitants of rural America, Richard sold them all in six months, winning 10 times his salary rail. He bought more watches and started a mail order service along the railroad line of Minnesota.
Richard Sears saw yet more clearly the opportunities offered by the railroad for the sale and distribution of goods. And so was born the catalog sales, and so it was founded Sears Roebuck & Co., the largest retailer in the United States until the end of the World War II.
Sears began selling watches. Alvah Curtis Roebuck, a watchmaker, the first employee and eventually founding partner, was hired to repair those watches that were returned. And then joined Julius Rosenwald, a tailor, which extended the offer in the catalog.
Watches, ladies and gentleman clothes, plows, bicycles, refrigerators, pianos, lamps … all in a 700-page catalog.
Richard teamed two decentralized networks, railways and telegraph, and clearly saw an opportunity: Sears Roebuck & Co. could sell anything and send it from Boston to California in less than a week.
A hundred and so years later, Sears joined the bandwagon of selling and renting movies via streaming.
While here in Spain there are some who miss the good times, all around the world there come out new businesses that only those with sight will take some profit of them. 100 years ago, Sears sold 10,000 units of sewing machines using a decentralized network, the railroad, and that was the first step in creating the largest national economy in history. Today, they sell and rent movies using the distributed network of fiber optic cables: the Internet.
Those who wants to see, they will see. Those who do not, are going straight into the ravine, whilst following the piper.
Pied Piper – illustration by Kate Greenaway – Project Gutenberg eText 1834
