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Barcodes Sweep the World
By Tony Seideman
Supermarkets are a perilous business. They must stock thousands
of products in scores of brands and sizes to sell at painfully small markups.
Keeping close track of them all, and maintaining inventories neither too
large nor too small is critical. Yet for most of this century, as stores
got bigger and the profusion on the shelves multiplied, the only way to find
out what was on hand was by shutting the place down and counting every can,
bag, and parcel. This expensive and cumbersome job was usually done no more
than once a month. Store managers had to base most of their decisions on
hunches or crude estimates.
Long before bar codes and scanners were actually invented, grocers knew they
desperately needed something like them. Punch cards, first developed for
the 1890 U.S Census, seemed to offer some early hope. In 1932, a business
student named Wallace Flint wrote a master's thesis in which he envisioned
a supermarket where customers would perforate cards to mark their selections;
at the checkout counter they would insert them into a reader, which would
activate machinery to bring the purchases to them on conveyer belts. Store
management would have a record of what was being bought.
The problem was, of course, that the card reading equipment
of the day was bulky, utterly unwieldy, and hopelessly expensive. Even if
the country had not been in the middle of the Great Depression, Flint's scheme
would have been unrealistic for all but the most distant future. Still, it
foreshadowed what was to come.
The first step toward today's bar codes came in 1948, when
Bernard Silver, a graduate student, overheard a conversation in the halls
of Philadelphia's Drexel Institute of Technology. The president of a food
chain was pleading with one of the deans to undertake research on capturing
product information automatically at checkout. The dean turned down the request,
but Bob Silver mentioned the conversation to his friend Norman Joseph Woodland,
a twenty-seven-year-old graduate student and teacher at Drexel. The problem
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His first idea was to use patterns of ink that would glow under
ultraviolet light, and the two men built a device to test the concept. It
worked, but they encountered problems ranging from ink instability to printing
costs. Nonetheless, Woodland was convinced he had a workable idea. He took
some stock market earnings, quit Drexel, and moved to his grandfather's Florida
apartment to seek solutions. After several months of work he came up with
the linear bar code, using elements from two established technologies: movie
soundtracks and Morse code.
Woodland, now retired, remembers that after starting with Morse
code, "I just extended the dots and dashes downwards and made narrow lines and wide lines out of them." To read the data, he made use out
of Lee de Forest's movie sound system from the1920's. De Forest had printed
a pattern of varying degrees of transparency on the edge of the film, then
shone a light through it as the picture ran. A sensitive tube on the other
side translated the shifts in brightness into electric waveforms, which were
in turn converted to sound by loudspeakers. Woodland planned to adapt this
system by reflecting light off his wide and narrow lines and using a similar
tube to interpret the results.
Woodland took his idea back to Drexel, where he began putting
together a patent application. He decided to replace his wide and narrow
lines with concentric circles, so that they could be scanned from any direction.
This became known as the bull's-eye code. Meanwhile, Silver investigated
what form the codes should ultimately take. The two filed a patent application
on October 20, 1949.
In 1951 Woodland got a job at IBM, where he hoped his scheme
would flourish. The following year he and Silver set out to build the first actual bar code reader – in the living room of Woodland's house in Binghamton, New York. The device was the size of a desk and had to be wrapped in black
oilcloth to keep out ambient light. It relied on two key elements: a five-hundred-watt
incandescent bulb as the light source and an RCA935 photo-multiplier tube,
designed for movie sound systems, as the reader.
Woodland hooked the 935 tube up to an oscilloscope. Then he
moved a piece of paper marked with lines across a thin beam emanating from
the light source. The reflected beam was aimed at the tube. At one point
the heat from the powerful bulb set the paper smoldering. Nonetheless, Woodland
got what he wanted. As the paper moved, the signal on the oscilloscope jumped.
He and Silver had created a device that could electronically read printed
It was not immediately clear how to transform this crude electronic
response into a useful form. The primitive computers of the day were cumbersome
to operate, could only perform simple calculations, and in any case were
the size of a typical frozen-food section. The idea of installing thousands
of them in supermarkets from coast to coast would have been pure fantasy.
Yet without a cheap and convenient way to record data from Woodland and Silver's
codes, their idea would have been no more than a curiosity.
Then there was that five-hundred-watt bulb. It created an enormous
amount of light, only a tiny fraction of which was read by the 935 tube.
The rest was released as expensive, uncomfortable waste heat. "That
bulb was an awful thing to look at," Woodland recalls. "It could
cause eye damage." The inventors needed a source that could focus a
large amount of light into a small space. Today that sounds like a prescription
for a laser, but in 1952 lasers did not exist. In retrospect, bar codes were
clearly a technology whose time had nowhere near come.
But Woodland and Silver, sensing the potential, pressed on.
In October 1952 their patent was granted. Woodland stayed with IBM and in
the late 1950's persuaded the company to hire a consultant to evaluate bar
codes. The consultant agreed that they had great possibilities but said they
would require a technology that lay at least five years off. By now almost
half the seventeen-year life of Woodland and Silver's patent had expired.
IBM offered a couple of times to buy the patent, but for much
less than they thought it was worth. In 1962 Philco met their price, and
they sold. (The following year Silver died at age thirty-eight.) Philco later
sold the patent to RCA. In 1971 RCA would jolt several industries into action;
before then, the next advances in information handling would come out of
the railroad industry.
Freight cars are nomads, wandering all across the country and
often being lent from one line to another. Keeping track of them is one of
the most complex tasks the railroad industry faces, and in the early 1960's
it attracted the attention of David J. Collins. Collins got his master's
degree from MIT in 1959 and immediately went to work for the Sylvania Corporation,
which was trying to find military applications for a computer it had built.
During his undergraduate days Collins had worked for the Pennsylvania Railroad
and he knew that the railroads needed a way to identify cars automatically
and then to handle the information gathered. Sylvania's computer could do
the latter; all Collins needed was a means to retrieve the former. Some sort
of coded label seemed to be the easiest and cheapest approach.
Strictly speaking, the labels Collins came up with were not
bar codes. Instead of relying on black bars or rings, they used groups of
orange and blue stripes made of a reflective material, which could be arranged
to represent the digits 0 through 9. Each car was given a four-digit number
to identify the railroad that owned it and a six-digit number to identify
the car itself. When cars went into a yard, readers would flash a beam of
colored light onto the codes and interpret the reflections. The Boston & Maine
conducted the first test of the system on its gravel cars in 1961. By 1967
most of the kinks had been worked out, and a nationwide standard for a coding
system was adopted. All that remained was for railroads to buy and install the equipment.
Collins foresaw applications for automatic coding far beyond
the railroads, and in 1967 he pitched the idea to his bosses at Sylvania. "I
said what we'd like to do now is develop the little black-and-white-line
equivalent for conveyer control and for everything else that moves," he
remembers. In a classic case of corporate shortsightedness, the company refused
to fund him. "They said, 'We don't want to invest further. We've got
this big market, and let's go and make money out of it.' " Collins quit
and co founded Computer Identics Corporation.
Sylvania never even saw profits from serving the railroad industry.
Carriers started installing scanners in 1970, and the system worked as expected,
but it was simply too expensive. Although computers had been getting a lot
smaller, faster, and cheaper, they still cost too much to be economical in
the quantities required. The recession in the mid-1970's killed the system
as a flurry of railroad bankruptcies gutted industry budgets. Sylvania was
left with a white elephant.
Meanwhile, Computer Identics prospered. Its system used lasers,
which in the late 1960's were just becoming affordable. A milliwatt helium-neon
laser beam could easily match the job done by Woodland's unwieldy five-hundred-watt
bulb. A thin stripe moving over a bar code would be adsorbed by the black
stripes and reflected by the white ones, giving scanner sensors a clear on/off
signal. Lasers could read bar codes anywhere from three inches to several
feet away, and they could sweep back and forth like a searchlight hundreds
of times a second, giving the reader many looks at a single code from many
different angles. That would prove to be a great help in deciphering scratched
or torn labels.
In the spring of 1969 computer Identics quietly installed its first two systems – probably the first true bar code systems anywhere. One
went into a General Motors plant in Pontiac, Michigan, where it was used
to monitor the production and distribution of automobile axle units. The
other went into a distribution facility run by General Trading Company in
Carlsbad, New Jersey, to help direct shipments to the proper loading-bay
doors. At this point the components were still being built by hand; Collins
made the enclosures for the scanners by turning a wastebasket upside down
and molding fiberglass around it. Both systems relied on extremely simple
bar codes bearing only two digits worth of information. But that was all
they needed; the Pontiac plant made only eighteen types of axle, and the
General Trading facility had fewer than a hundred doors.
Computer Identic's triumph proved the potential for bar codes
in industrial settings, but it was the grocery industry that would once again
provide the impetus to push the technology forward. In the early 1970's,
the industry set out to propel to full commercial maturity the technology
that Woodland and Silver had dreamed up and Computer Identics had proved
Already RCA was moving to assist the industry. RCA executives
had attended a 1966 grocery industry meeting where bar-code development had
been urged, and they smelled new business. A special group went to work at
an RCA laboratory in Princeton New Jersey, and the Kroger grocery chain volunteered
itself as a guinea pig. Then, in mid 1970, an industry consortium established
an ad hoc committee to look into bar codes. The committee set guidelines for bar code development and created a symbol selection subcommittee to help standardize the approach.
This would be the grocery industry's Manhattan Project, and
Alan Haberman, who headed the subcommittee as president of First National
Stores, recalls proudly, "We showed that it could be done on a massive
scale, that cooperation without antitrust implications was possible for the
common good, and that business didn't need the government to shove them in
the right direction."
At the heart of the guidelines were a few basic principles.
To make life easier for the cashier, not harder, bar codes would have to
be readable from almost any angle and at a wide range of distances. Because
they would be reproduced by the millions, the labels would have to be cheap
and easy to print. And to be affordable, automated checkout systems would
have to pay for themselves in two and a half years. This last goal turned
out to be quite plausible; a 1970 study by McKinsey & Company predicted
that the industry would save $150 million a year by adopting the systems.
"It turns out there were massive savings that we called
hard savings, out-of-pocket savings in labor and other areas," Haberman
says. "And there were gigantic savings available in the use of information
and the ability to deal with it more easily than we had before, but we never
quantified that." Hard, quantifiable savings were what would draw retailers.
These included checking out items at twice the speed of cashiers using traditional
equipment, which would mean shorter lines without staff increases.
Still, while early bar-code systems would automate the checkout,
they would not be useful for monitoring inventory, because at first too few
items would come labeled with codes. Savings from using the collected information,
instead of simply from cutting labor costs, would have to wait until most
items bore codes. After that happened, management at every level would have
to transform the way it operated.
In the spring of 1971 RCA demonstrated a bulls-eye bar code system at a grocery industry meeting. Visitors got a round piece of tin;
if the code on top contained the right number, they won a prize. IBM executives
at that meeting noticed the crowds RCA was drawing and worried that they
were losing out on a huge potential market. Then Alec Jablonover, a marketing
specialist at IBM, remembered that his company had the bar code's inventor
on staff. Soon Woodland-whose patent had expired in 1969-was transferred
to IBM's facilities in North Carolina, where he played a prominent role in
developing the most popular and important version of the technology: the
Universal Product Code (UPC).
RCA continued to push its bull's-eye code. In July 1972 it
began an eighteen-month test in a Kroger store in Cincinnati. It turned out
that the printing problems and scanning difficulties limited the bull's-eye's
usefulness. Printing presses sometimes smear ink in the direction the paper
is running. When this happened to bull's-eye symbols, they did not scan properly.
With the UPC, on the other hand, any extra ink simply flows out the top or
bottom and no information is lost.
For a time such exotica as starburst-shaped codes and computer
readable characters were considered, but eventually the technically elegant
IBM-born UPC won the battle to be chosen by the industry. No event in the
history of modern logistics was more important. The adoption of the Universal
Product Code, on April 3, 1973, transformed bar codes from a technological
curiosity into a business juggernaut.
Before the UPC, various systems had begun to come into use
around the world in stores, libraries, factories, and the like, each with
its own proprietary code. Afterward bar code on any product could be read
and understood in every suitably equipped store in the country. Standardization
made it worth the expense for manufacturers to put the symbol on their packages
and for printers to develop the new types of ink, plates, and other technology
to reproduce the code with the exact tolerances it requires.
Budgets for the bar-code revolution were on a scale to make
the Pentagon blanch. Each of the nation's tens of thousands of grocery outlets
would have to spend at least $200,000 on new equipment. Chains would have
to install new data processing centers and retrain their employees. Manufacturers
would potentially spend $200 million a year on the labels. Yet tests showed
that the system would pay for itself in a few years.
Standardization of the code meant the need for a standardized
system of numbers to go on it. "Before we had bar codes, every company
had its own way of designating its products," Haberman says. Some used
letters, some used numbers, some used both, and a few had no codes at all.
When the UPC took over, these companies had to give up their individual methods
and register with a new Uniform Code Council (UCC).
The code is split into two halves of six digits each. The first
one is always zero, except for products like meat and produce that have variable
weight, and a few other special types of items. The next five are the manufacturer's
code; the next five are the product code; and the last is a "check digit" used
to verify that the preceding digits have been scanned properly. Hidden cues
in the structure of the code tell the scanner which end is which, so it can
be scanned in any direction. Manufacturers register with the UCC to get an
identifier code for their company, then register each of their products.
Thus each package that passes over a checkout stand has its own unique identification
Two technological developments of the 1960s finally made scanners
simple and affordable enough. Cheap lasers were one. The other was integrated
circuits. When Woodland and Silver first came up with their idea, they would
have needed a wall full of switches and relays to handle the information
a scanner picked up; now it's all done by a microchip.
On June 26, 1974, all the tests were done, all the proposals
were complete, all the standards were set, and at a Marsh supermarket in
Troy, Ohio, a single pack of chewing gum became the first retail product
sold with the help of a scanner. Decades of schemes and billions of dollars
in investment now became a practical reality. The use of scanners grew slowly
at first. A minimum of 85 percent of all products would have to carry the
codes before the system could pay off, and when suppliers reached that level,
in the late 1970s, sales of the systems started to take off. In 1978 less
than one percent of grocery stores nationwide had scanners. By mid-1981 the figure was 10 percent; three years later it was 33 percent, and today more than 60 percent are so equipped.
Meanwhile, the technology has been creeping into other industries
and organizations. Researchers have mounted tiny bar codes on bees to track
the insects' mating habits. The U.S. Army has used two-foot-long bar codes
to label fifty-foot boats in storage at West Point. Hospital patients wear barcode ID bracelets. The codes appear on truck parts, business documents,
shipping cartons, marathon runners, and even logs in lumberyards. Federal
Express, the package-shipping giant, is probably the world's biggest single
user of the technology; its shipping labels bear a code called Codabar. Along
the way refinements of the basic UPC have been developed, including the European
Article Numbering System (EAN), developed by Joe Woodland, which has an extra
pair of digits and is on its way to becoming the world's most widely used
system. Other codes, which are given such fanciful names as Code 39, Code
16K, and Interleaved 2 of 5, can sometimes contain letters as well as numbers.
Woodland never got rich from bar codes, though he was awarded
the 1992 National Medal of Technology by President Bush. But all those involved
in the early days speak of the rewards of having brought a new way of doing
business into the world. "This thing is a success story on the American
way of doing things," Haberman says. "Our own initiative – take it on ourselves, inviting the world to join in. It has something to say about
the little guys with lots of vision.
Tony Seideman is a free lance writer who lives in New York
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