The transistor: an invention becomes a big business

Worldwide electronic equipment sales in 1996 were $851 billion, of which 16.5% or $140 billion were semiconductors. By the year 2000, estimates show that the semiconductor portion of equipment sales will grow to 21.1% or about $263 billion. This paper sets about to examine the birth and critical milestones of this phenomenal world-changing industry. Starting immediately after the Second World War, Bell Laboratories' management established a group to investigate semiconductors with a view to their application in telephone equipment. The group, headed by W. Shockley and including J. Bardeen and W. Brattain, was fully in place by January 1946. By December of the following year, Brattain and Bardeen had discovered the point-contact transistor. Early in the following year, Shockley established his theory of minority carrier injection and predicted the operation of the junction transistor. This paper outlines the growth of this business, starting initially among vacuum-tube manufacturers and spreading to high-growth-rate startups and on to major international companies. The importance of the U.S. military and space programs in the critical early days of both the transistor and the integrated circuit are touched on briefly. This paper gives careful attention to the birth and current state of the semiconductor scene of the Asian countries of Japan, Korea, and Taiwan. A review of the semiconductor industry in Europe, along with its decline and resurgence, is included. To complete the picture, the authors discuss the semiconductor industry decline and resurgence in the United States along with the contribution of SEMATECH and the importance of the personal computer to the U.S. recovery. This paper has two key appendixes. One focuses on the role of memory products as the industry enters the next century and the other complements the first by addressing the advent of system application-specific integrated circuits and the need for "continuous innovation" to meet the needs of each new product generation. These appendixes show the continuation of the semiconductor industry's traditional role in all electronic products namely, that of providing improved features, performance, and functionality with ever lower costs and higher quality.