225 – Shady Dealings in a Bright Industry: Phoebus Cartel
In Episode 225 of Anecdotally Speaking, Mark explores why lightbulbs don’t last forever and the implications of planned obsolescence. In Episode 225 of Anecdotally Speaking, Mark unpacks a century-old conspiracy that continues to impact our everyday lives—the story of the Phoebus Cartel and its role in the life expectancy of light bulbs. Mark takes us through the history of incandescent bulbs, from Thomas Edison’s first commercial light bulb to the cartel that conspired to limit their lifespan to 1,000 hours, all for profit. This tale offers insights into the concept of planned obsolescence, the long-term effects of business decisions, and even the origins of conspiracy theories. Today’s story provides a thought-provoking lens through which to explore capitalism’s strengths and pitfalls. In business settings, it serves as a powerful reminder of how short-term decisions can create long-lasting impacts, sparking conversations about strategy, ethics, and the consumer market. For your story bank Tags: Strategy, Conspiracy, Impact, Technology This story starts at 0:30 In 1879, Thomas Edison invented the first commercially viable light bulb, sparking rapid growth in the industry. As companies rushed to enter the market, research into extending the lifespan of light bulbs became a priority. By the 1920s, bulbs could last 2,000 to 2,500 hours, and some bulbs, like the “Centennial Light” in a California fire station, were known to last even longer. This bulb, manufactured by the Shelby Electric Company, has been burning almost continuously since 1901, a testament to how durable light bulbs could be when crafted with quality materials. As light bulbs were made to last longer, a problem emerged for manufacturers: if bulbs rarely needed replacing, sales would decline. By the 1920s, consolidation in the light bulb industry had led to monopolies in several countries, each dominated by a single company. In Germany, it was Osram; in the U.S., General Electric; in the UK, Associated Electrical Industries; and in other countries, similar monopolies existed. In 1923, the CEO of Osram in Germany recognized that improved light bulb lifespans were impacting profits, especially after a poor year of sales. To address this, he contacted other companies holding light bulb monopolies in their countries. By Christmas of 1924, representatives from these companies gathered in Geneva, where they formed a cartel known as the Phoebus Cartel. In this meeting, the companies agreed to standardize the lifespan of their bulbs at 1,000 hours—significantly shorter than existing bulbs. This move effectively forced consumers to buy new bulbs more frequently, boosting sales and profitability for all involved. Thus began the practice of planned obsolescence: deliberately shortening a product’s lifespan to drive demand. Implementing this standard proved challenging, as engineers initially struggled to make bulbs less durable. However, the companies persisted, conducting research and imposing heavy fines on any members whose bulbs lasted longer than 1,000 hours. The Phoebus Cartel continued until 1939 when World War II made it impossible for companies from warring nations to collaborate. Years later, in 1953, General Electric was prosecuted in the United States for monopolistic practices related to the cartel’s activities. The impact of the Phoebus Cartel endures even today. Despite modern advancements, the average incandescent light bulb still lasts around 1,000 hours—a standard rooted in the cartel’s century-old agreement.
