Compartmentalizing

How shipping containers reshaped the global freight industry

Tankers were already quite common in the 1950s, but they had a significant problem: They weren’t really designed to carry lots of different kinds of things. If a tanker was moving oil between coasts, there wasn’t really room for anything other than oil.

This was inefficient for multiple reasons: For one thing, if you were delivering oil from one port to another, it’s not like the tanker was going to bring oil back with it—that’s not how oil works. That meant a return trip was a function of sheer location and was otherwise completely fruitless.

Compare this to trucking—when McLean’s crew delivered textiles up north, they often brought something back with them. What if you could apply this thinking to ships?

And so, that’s what McLean did with U.S. patent 2,853,968, “Apparatus for Shipping Freight.” The strategy was simple: Rather than having trucks deliver freight that could be placed on a ship to travel globally, you put the truck bed itself onto the ship. The tankers, many of which had been used in World War II, were large enough to hold dozens of them, and the scale meant the ships could carry literal tons of freight—per container.

Plus, containers are strong enough to make the transition in one piece, literally—and by treating them like building blocks, they become even stronger structurally. Per the patent filing:

The containers are of sturdy construction capable of withstanding the forces to be encountered on the open seas and are adapted to receive the freight to be trans ported. In a specific, and particularly advantageous, embodiment of my invention, hereafter more specifically described, each container may be of a construction adapted to receive a complete truck-trailer fully loaded with freight.

The construction is such that two rows of containers are formed. Preferably, the containers of one row are in side by side relation with each other and in end to end relation with the adjacent containers of the other row. Thus, the long sides of the containers are protected from direct impact from high seas by adjoining containers and in the case of the four end containers their outer sides are protected by the forecastle or poop deck structure as the case may be.

There are lots of other advantages, too: It didn’t require significant redesigns of existing ships, and by placing the containers atop the ship, it could suddenly make single-purpose ships multifunctional. Plus, it prevented containers from getting lost—like the items on a plate destined for a picky eater, everything’s kept separate.

Soon after filing this patent, McLean resigned from his position with McLean Trucking Company and founded a replacement company. Within a couple of years, McLean had launched a company, Sea-Land, and a ship of his own to test out the idea. He set up deliveries from New Jersey to Houston to prove to skeptical shipping firms that he wasn’t crazy. Not only did the idea work, but it worked swimmingly well.

About 15 years later, McLean would make another exit from a company he built—except this time it was a company worth mid-nine figures, not low-eight.

When the SS Ideal-X launched, modified to allow more containers to sit on the top, little did McLean know that he was about to fundamentally change an industry. And not always for the better.

Containerization was a huge boon for shipping—but it came with real human costs

Fans of ruthless efficiency will find a lot to like about the story of shipping containers. They not only simplified a complex process, but they made shipping a much more cost-effective tool for product globalization.

There are likely many things in your home that spent time on a freighter before they landed in your hands, and it’s because shipping suddenly became cost-effective—pennies on the dollar compared to what it was previously.

But there’s a lot of complication that comes with the model, and much of it falls on longshoremen. As a 1978 Bureau of Labor Statistics report on the longshore industry put it:

The advent of container technology in the early 1950s and competitive pressures to cut costs and improve productivity led management to initiate innovative approaches in the use of cargo handling equipment and work processes.

It became a huge point of contention in many labor battles, as the added efficiency came at the cost of tens of thousands of jobs globally, along with a gradual decline in rights for the workers that remained. Numerous work stoppages followed.

And it’s not like things have gotten much better since. As a 2022 piece from The American Prospect noted, recent deregulations in the container industry have increased the sizes of ships while creating additional complexity at ports. In the example they shared, a crew of Filipino seafarers found themselves stuck at sea for more than a year—but also stuck at the Long Beach port for months, all because the port was too full.

There is some irony to this, as McLean had basically come up with the shipping container idea specifically to cut down on unnecessary delays. As Ian Graham wrote in his book Fifty Ships That Changed the Course of History:

During Thanksgiving Week in 1937, McLean accompanied a cargo of cotton to New York and watched it being loaded on board a ship bound for Istanbul, Turkey. As the days went by, he grew increasingly frustrated by the delays. Since shipping companies couldn’t predict how long the process would take and therefore exactly when a ship would leave one port and arrive at its next port, they had to deliver their cargo to port facilities days or even weeks before it was due to be loaded onto a ship, increasing the chance that some of it might be lost, damaged or stolen. Vast warehouses were needed to store goods at ports, and the process was so
labor-intensive that it was also very expensive.

Essentially, you might argue that McLean’s simple idea worked so well that it actually created a situation where those delays are happening during the drop-off process.

Compare the number of containers on McLean’s ship with the number of containers on the Ever Given, the ship that infamously got stuck in the Suez Canal a few years back.

Though to be completely fair to McLean’s great idea, it was somewhat sabotaged by deregulation, which arguably made it almost too popular. From Amir Khafagy’s American Prospect piece:

Prior to the 1980s, the Shipping Act of 1916 regulated the relatively modest ocean carrier industry like a public utility. Prices were transparent and there were no exclusive agreements for volume shippers; anyone wanting to ship cargo could access the same rates. The United States Shipping Board, later the Federal Maritime Commission (FMC), regulated prices and practices, and subsidies assisted domestic shipbuilding. The act enabled smaller companies to enter ocean shipping with stable prices to weather downturns.

But the Shipping Act of 1984, and later the Ocean Shipping Reform Act of 1998, took down this architecture. It allowed shipping companies to consolidate, and eliminated price transparency, facilitating secret deals with importers and exporters. The FMC was defanged as a regulator. Almost immediately, containerization took off. The number of goods carried by containers skyrocketed from 102 million metric tons in 1980 to about 1.83 billion metric tons as of 2017.

This essentially created our modern economy of cheap stuff delivered cheaply from around the world. But it also created chaos in the form of bad labor conditions and a significant shift in terms of what the shipping industry needed from longshoremen and seafarers alike. Plus, the ships—and the ports!—had to keep changing to accommodate the puzzle pieces that Malcom McLean invented. They were LEGOs with consequences.

Putting this back in computer terms, because those are the open seas I’m familiar with: Docker is great for compartmentalizing self-hosted apps. But the truth of the matter is, every computer has a ceiling of how many containers it can manage. Some can handle one or two, others 20 or 30.

But eventually, there’s a limit, a point where things can topple over because there’s just too much stuff. But it’s a mushy limit, one that you will only find after testing the waters and finding that you’re starting to boil the ocean. Containerization is such a good idea, in a shipping context, because it turned an expensive, time-consuming shipping process into a cheap one.

But like the stuff on your computer, it’s not immune to enshittification. And eventually, the stuff wants to break out of the container.