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One of the major modes of failure in germanium alloy power transistors is collector diode degradation. It has been found that the time response of the collector diode, measured initially, is a strong indicator of later degradation failure. The "0" hour time varying characteristic of a potential failure is explained by a proposed model which involves an ionic charge separation phenomenon. This phenomenon involves the transient formation of an accumulation layer and an avalanche-limited breakdown of the junction near the surface. The proposed model suggests several process modifications which would reduce or eliminate conditions which result in degradation failure. Process improvements which were generated by this study and other related programs have resulted in a significant improvement of the degradation failure rate.