American Experience (1988) s25e06 Episode Script

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NARRATOR:
In June 1957, at San Francisco's
luxurious Clift Hotel,
eight of the country's most
talented young scientists
and engineers assembled
for a secret meeting.
For the previous 14 months,
they had been working together
at Shockley Semiconductor
Laboratory outside of Palo Alto,
developing a technology that
promised to be revolutionary.
But in recent months,
William Shockley,
the head of the company and the
mind behind that technology,
had become increasingly erratic.
Now, the eight were conspiring
to defect
To quit Shockley and form
their own firm,
under the leadership
of one of their own,
29-year-old Robert Noyce,
a Midwesterner with
a brilliant scientific mind
and the genuine affability
of a born salesman.
It had taken some convincing
to get Noyce onboard.
LESLIE BERLIN:
Noyce had a young family.
And to leave sort of
a known paycheck
for something that there
was no model for,
this notion of breaking away
and doing something different.
NARRATOR:
Soon it came time
to seal the deal.
In the absence
of an official contract,
eight newly-minted dollar bills
were passed around the table
for signatures.
Noyce got out his pen.
MICHAEL MALONE:
I honestly think
that Silicon Valley begins
on a very specific morning.
That morning is the morning
that the guys from Shockley
don't know if Noyce
is going to go.
And he gets in the car that
morning and goes with them.
BERLIN:
Those dollar bills they signed
are Silicon Valley's
declaration of independence
A statement that we are going
to go out and start a company
according to our own ideals
and our own beliefs,
and nothing is going to stop us.
NARRATOR:
On that morning in 1957,
none of the eight defectors
likely had any idea
what would happen next.
The coining of the phrase
"Silicon Valley"
was more than ten years
in the future.
The unique business culture
with which the place would come
to be associated
Openness over hierarchy,
risk over stability,
innovation over the tried and
true had still to be tested.
And the integrated circuit
the revolutionary technology
that would usher in a new era
in human history
Had yet to be invented.
That morning,
the future Silicon Valley was
just a speck on the map
and a most unexpected place for
the Information Age to begin.
Had it not been
for William Shockley,
everything that was to come
might well have happened
somewhere else.
At the time that Shockley
planted his flag
in California's Santa Clara
Valley, south of San Francisco,
in 1956, the area was known
mainly for its orchards
Mile upon lush, green mile
of fruit trees,
heavy with apricots,
cherries, almonds.
Marketers had dubbed it "The
Valley of Heart's Delight."
JAY LAST:
When I was 16,
I was living in a steel mill
town in Pennsylvania
and had a free summer between
my junior and senior year
and decided to hitchhike
to California.
And I spent the summer picking
apricots in Santa Clara Valley.
It was just an unbelievably
beautiful area
with all these fruit trees.
NARRATOR:
Far from the nation's banking
and manufacturing centers,
the Santa Clara Valley was not,
at first glance,
an obvious spot
for a technology company.
All of the leading
electronics firms
Westinghouse, General Electric,
Raytheon, IBM
Then had their headquarters
on the East Coast.
But Shockley had personal ties
to the valley
His mother had lived there
for years
And the land was
blessedly cheap.
Hoping to entice aerospace
and electronics companies
to the region,
Stanford University was offering
long-term leases in Palo Alto
at bargain-basement prices.
KATHLEEN COHEN:
Setting aside land that could be
leased to those companies
was, I think,
a very, very important thing.
And so we have the university
then connecting with industry.
This just created a terrific
atmosphere for entrepreneurship.
NARRATOR:
By the time Shockley set up
his laboratory,
a handful of other electronics
firms
Hewlett-Packard, Varian,
Litton
Also operated in the valley,
as did the missile systems
division of Lockheed Aircraft.
Here and there,
the agricultural landscape
already was beginning
to give way
to suburban subdivisions and
large industrial structures.
And as they had more
than a century earlier
during the Gold Rush, Americans
were heading to California
in ever-increasing numbers
Some 3,000 a month
in the late 1950s
In search of opportunity.
COHEN:
People came to California
to get started again
in their lives
in new directions.
The idea of the new is a very
exciting thing for Californians.
You're not as limited
to what has gone before.
NARRATOR:
For Shockley and the other
entrepreneurs in the valley,
there was the genuine feeling of
starting something from scratch.
REGIS McKENNA:
This was pretty much a
technological wilderness
when they came here.
Like the early pioneers
that moved west,
they somehow struck out
without really knowing
what the outcomes
were going to be.
NARRATOR:
Like many of the new arrivals,
William Shockley had made
his name in the East.
One of the most legendary
applied physicists
in the history of science,
he had spent much of his career
at Bell Telephone Laboratories,
the renowned private research
and development firm
in New Jersey.
It was there, in 1947,
that he had become famous
as one of the inventors
of a tiny electronic device
known as a transistor.
It's a transistor, no bigger
than a kernel of corn.
MALONE:
The transistor is a turning
point in technology history
And actually human history
Because it's taking
an existing technology
and moving it into a whole
new dimension.
NARRATOR:
Since the 1930s,
most electronics
Everything from television
sets to hearing aids
Had run on vacuum tubes.
They were behind
the transmission
of telephone signals,
radio and radar,
and also ran the world's first
electronic
general-purpose computer,
which was built by the U.S. Army
during World War II
and popularly known
as a "Giant Brain."
MALONE:
It was the fastest computation
machine anyone had ever seen,
but it had one big problem:
it was the size of a warehouse.
And these tubes consumed
a lot of electricity,
and they used to joke that when
you turned it on,
it dimmed the lights of the city
around it.
And you had to have men run
around inside the computer
changing tubes because they
burned out pretty quickly.
NARRATOR:
Vacuum tubes, like light bulbs,
worked by heating up
a thin metal filament.
And, as with light bulbs,
the filament burned out
from time to time,
requiring the tube
to be replaced.
The transistor, by contrast,
was virtually indestructible.
TED HOFF:
The transistor represented
a major advance in being able
to do electronic work
with far less power
and a far smaller device.
NEWSREEL ANNOUNCER:
What's inside the transistor?
Dr. Shockley shows us using
a huge scale model.
Inside are two pins
NARRATOR:
The key to the transistor
was a chemical element
known as a semiconductor.
In between materials
like metals,
which conduct electricity
easily,
and insulators such as
rubber and glass,
which block electricity, a
semiconductor could do both,
enabling it to act as
an electrical switch.
By exploiting the properties of
the semiconductor germanium,
Shockley and his colleagues
had invented a device
with the potential to completely
transform
the electronics industry.
One of the first hints of what
was possible came in 1954
with the transistor radio,
which was small enough
to fit in a pocket.
(surf rock music playing)
The transistor radio
quickly became
the most popular electronic
communication device
the world had ever seen.
(surf rock music ends)
By 1955, scientists and
electrical engineers
all over the country were racing
to develop new applications
for the transistor.
Shockley had more
ambitious plans:
to exploit the commercial
potential of the transistor
and make it the cornerstone
of a large and potentially
lucrative new industry.
He decided to leave Bell Labs,
founded his own firm
in California,
and began raiding Ph.D. programs
and electronics companies
for gifted young recruits.
GORDON MOORE:
He knew chemists had been useful
to him at Bell Laboratories,
so he thought he needed one
in his new operation,
and he got my name
and gave me a call.
Fortunately,
I recognized who it was.
I picked up the phone, he says,
"Hello, this is Shockley."
LAST:
He just showed up in my lab
at MIT one day, and I thought,
"My God, I've never met anybody
this brilliant."
I changed my whole career plans
and said,
"I want to go to California
and work with this man."
NARRATOR:
Robert Noyce, then a 28-year-old
research manager at Philco,
the Philadelphia-based
electronics firm,
was equally impressed.
As he would later say
of his phone conversation
with Shockley,
"It was like talking to God."
Just over a month later, Noyce
was headed out to California,
an interview at Shockley
Laboratories scheduled
for the following morning.
MALONE:
It was a chance for him to be
among the best and the brightest
young scientists in America,
a chance to work with this
acknowledged genius.
And Shockley was making noises
about how he was going
to transform
the electronics industry,
you know, with brilliant
new inventions.
I mean how do you say no
to something like that?
NARRATOR:
Shockley touted his new team
as the "most outstanding
in the semiconductor field"
A dozen-and-a-half young
scientists of various stripes
Physicists, electrical
and mechanical engineers,
metallurgists, tool builders,
all of them rising stars
in the field,
all but a handful
under the age of 30.
LAST:
We were all about the same age,
and we had made scientific
accomplishments
on our own before that.
We were very, very compatible
with our scientific training
and with the way we looked
on the world.
NARRATOR:
There was Jay Last,
a Pennsylvania-born physicist
with a doctorate from MIT;
chemist Gordon Moore, who had
grown up in the farm country
north of the Santa Clara Valley
but had spent the last two years
at Johns Hopkins
Applied Physics Lab;
Jean Hoerni, a theoretical
physicist from Switzerland
with two doctoral degrees
and a glowing employment
recommendation from Cal Tech;
and Robert Noyce, a native
of Iowa with a Ph.D. from MI
and the Shockley team's resident
expert on transistors.
VICTOR JONES:
There was no one there
other than Bob Noyce
who was really well-grounded
in semiconductors.
Gordon Moore, Jay Last
and myself,
we used to get there at 6:00
and try to teach ourselves
semiconductor physics
for the first hour
in the morning.
LAST:
I had never seen a transistor
until I went to work
for Shockley.
Bob knew and understood
transistors very well.
And talking to him was a way
of really learning
a lot of stuff very quickly.
NARRATOR:
By coincidence, Noyce had been
introduced to the transistor
soon after its development
at Bell Labs.
He'd been an undergraduate at
Iowa's Grinnell College then,
studying under Grant Gale,
a physics professor
who just happened to have
gone to college
with one of the transistor's
inventors.
At Gale's request, Bell Labs
sent over the technical reports
on the new device.
Noyce devoured them.
With the transistor, Noyce knew
he was looking at the future.
"The concept hit me like the
atom bomb," he later recalled.
"It was one of those ideas that
jolts you out of the rut,
gets you thinking
in a different way."
LAST:
The transistor was still
a laboratory curiosity
at Bell Labs during that period.
MALONE:
It somehow manages
to get to Iowa
to a little liberal arts college
in the middle of the country,
and sitting there in the class
is the man who's going
to make it all happen.
The odds are astronomical
of any of this occurring.
NARRATOR:
Noyce went on to study
transistor-related technology
at MIT, then took the job
with Philco
in its newly formed
transistor division.
Bright and personable, he was
quickly promoted to manager,
and just as quickly came
to the conclusion
that the bureaucracy
of East Coast corporations
did not suit him.
McKENNA:
Places like Philco,
and Bell Labs, and IBM
They were very large,
hierarchical kinds of companies
and businesses.
And it was very structured.
Philco was so structured that
your status and your furniture
was determined by a book
that actually had your title
and your position in the company
and what sort of furniture
you were allowed to have
in your office at that time.
And so everything was put in
a rulebook of some kind.
It was very stifling and
limiting in your own freedoms.
BERLIN:
Noyce wanted to be a scientist
To be in a lab all day
every day.
He quickly discovered
that he hated management.
He had imagined himself
as an independent operator.
ROBERT NOYCE:
Philco was doing good work
in transistors,
but Shockley was the top
of the field.
And I wanted to see if I could
compete with him, if you will.
I wanted to play
in the big leagues.
NARRATOR:
In California, Noyce would get
his chance.
NARRATOR:
In 1956, Shockley Semiconductor
had all the makings
of a success: solid financial
backing
from a Southern California
technology company,
Beckman Instruments,
and a straightforward mandate
Build a commercially viable
silicon transistor.
At that point, the standard
semiconductor used
in transistors was germanium.
But germanium functioned poorly
at high temperatures,
making it spectacularly
ill-suited to meet the demands
of the burgeoning defense
industry,
with its heat-producing missiles
and planes.
The solution was to create
a device built
from germanium's more stable,
more heat-resistant cousin,
silicon.
But silicon was difficult
to work with
and its conductivity
hard to manipulate.
Shockley wanted to try
a new method.
We were all going through
a learning experience
with silicon
and this new technology.
And we were making some progress
but there was still quite
a long ways to go.
NARRATOR:
Then, about six months
into the project,
came news that Shockley had been
awarded the Nobel Prize
along with two of his colleagues
from Bell Labs
for inventing the transistor.
MOORE:
We adjourned to salute the honor
with champagne
starting at 9:00 in the morning
at a local restaurant.
NARRATOR:
All of them would later mark
that celebration
as the beginning of the end.
LAST:
The whole atmosphere changed
very quickly,
and and it deteriorated
very rapidly.
NARRATOR:
Shockley's ego
outsized to begin with
Now threatened to eclipse
his genius.
He became rigid, authoritarian,
impossible to please.
He began to show lots and lots
of anger towards people
who weren't doing things
according to what he wanted
to do.
NARRATOR:
Without warning or explanation,
Shockley demanded that much
of his team shift its focus
from the silicon transistor
to a complicated new device
called a four-layer diode.
MOORE:
Bob Noyce and I wrote
a pretty strong memo to him
as to why the transistor
was where he ought
to continue to work,
but it didn't seem to have
any significant impact.
LAST:
This four-layer diode wasn't
coming along very fast.
With the path we were on,
we were never going to have
a commercial device.
He couldn't face up to the fact
that he'd made a bad decision,
so he started blaming
everybody around him.
He was very abusive.
I went from being his
fair-haired boy to being
one of the causes
of all his problems.
It was very painful to me.
They knew how good they were,
and Shockley was treating them
as if they were children.
They would come in
with a great idea
and Shockley would get
on the phone and call
one of his old colleagues at,
you know, Bell Labs
and say, "What do you think?"
It must have been very, very
difficult to be told every day
that you can't be trusted
with your own ideas.
LAST:
We'd go away for the weekend
and bemoan the problems we were
getting into with Shockley,
and trying to understand why
things had all of a sudden
gotten so difficult
with the man.
NARRATOR:
Eventually, seven of the
company's top scientists
and engineers
Jean Hoerni, Julius Blank,
Victor Grinich, Eugene Kleiner,
Gordon Moore, C. Sheldon Roberts
and Jay Last
Decided to take matters
into their own hands.
They contacted Shockley's boss,
Arnold Beckman,
and requested that Shockley
be removed as manager.
MOORE:
Beckman essentially told us,
"Shockley's the boss, take it
or leave it."
We discovered a group of young
Ph.D.s couldn't push aside
a new Nobel Prize winner
very easily.
LAST:
So we were just completely
sandbagged,
and we realized then
we had to leave.
We had really burned
our bridges.
McKENNA:
The business culture
that existed in this country
was that you go to work
for a company
and you stay with that company
and you retire
with that company.
People did it at General Motors,
people did it at
Ford Motor Company,
people did it at Philco.
This was what traditional
East Coast
And even Midwestern
American values were.
MALONE:
These guys all joined
on the belief
that they would stay there
forever.
And it really took the
incredibly bad management skills
of Bill Shockley to alienate
them so badly
that they would contemplate
just, you know,
stepping out the front door
into the abyss.
NARRATOR:
Shortly after the attempted coup
at Shockley,
a letter landed on the desk
of Arthur Rock,
a financial analyst at the Wall
Street investment firm
of Hayden Stone.
ROCK:
The letter essentially said
that there were seven people
connected
with Shockley Laboratories
who were thinking of leaving
and did we know any company
that would like to hire them.
MOORE:
Arthur Rock came out
to meet with us.
He told us,
"What you really want to do is
set up your own company,
and we will find you financing."
LAST:
None of us really knew
many details
of what was involved in running
a company.
But it just looked like a very
exciting direction to go.
NARRATOR:
At that moment, Robert Noyce was
not among the defectors.
But they all agreed
the new venture needed him.
MOORE:
Bob was the kind of person
everybody liked
when they first met him.
He had that personality that
came across very smoothly.
And, as such, it opened doors.
And, of course, he was
brilliant, which helped.
NARRATOR:
Thanks to his knowledge
of transistors,
Noyce had been given some real
authority in Shockley's lab,
and he was reluctant
to walk away at first.
NOYCE:
I felt that I had a commitment
to Shockley,
and I wanted to do everything
I could
to make that organization work.
And so I felt that my
first obligation
was to try to talk those seven
folks into not leaving.
When I failed in that,
I felt that I should join them.
NARRATOR:
Now they were eight.
LAST:
Our real aim was to keep
working together.
We knew we could build
a transistor
that was going to be a very
successful, innovative product.
MALONE:
They've, in a sense, already
rolled the dice in a big way
just being where they are.
You go to California,
you leave your life behind,
you strike out to try something
new and to start your life over.
And the job turns out to be
a nightmare.
Now you get to the moment
of decision
Are you going to roll the dice
one more time?
NARRATOR:
In New York, Arthur Rock was
working the phones
in search of a backer.
ROCK:
We made up a list
of 45 companies
that might be interested,
but none of them were willing
to take on
a separate company division.
They felt that their
own employees
would have problems with it,
that they would see it as a way
that someone else made
a lot of money at their expense.
They just couldn't get
it through their heads
that this was
a good opportunity.
We had a couple of months
of doing this
and were about to give up
when someone suggested that
I see Sherman Fairchild.
NARRATOR:
A prolific inventor
and entrepreneur,
Sherman Fairchild was the owner
of Fairchild Camera
and Instrument,
a New York-based manufacturer
of aeronautic, electronic
and photographic products.
He was also the largest
single stockholder in IBM,
the computing giant his father
had co-founded.
ROCK:
Sherman Fairchild was well known
and well respected and used to
tinkering around with things.
And he immediately saw
the potential in this.
LAST:
Sherman Fairchild had the vision
and the interest in us.
He was very rich, had a very
great imagination
and enthusiasm for things.
And if it hadn't been for him,
I don't know if
we would've found a sponsor.
NARRATOR:
Fairchild readily agreed
to put up $1.3 million.
In exchange, he retained
an option to buy out
the new subsidiary.
If Fairchild Semiconductor
were successful,
the parent company was
positioned to reap the benefits.
Shockley Laboratory was about to
suffer an exodus of talent
from which it would
never recover.
MOORE:
Shockley was crushed.
He looked like a, a beaten puppy
as he walked out the door
that day.
NARRATOR:
With Shockley reeling,
Beckman issued a warning
to the eight defectors.
BERLIN:
They were told,
"This is a shameful act.
"You need to consider
the consequences.
"You have essentially turned
traitor.
"You have broken what everyone
knows is the contract
"that you make when you start
working at a company,
"which is you're there forever.
"You've changed the rules
of the game
and you're never going
to live that down."
It looks easy nowadays
because we have a tradition,
largely set in motion
by those guys,
where it's accepted
in this town.
You're better off to go out and
start your own company and fail
than it is to stick
at one company for 30 years.
The real respect comes
from going out there
and being an entrepreneur.
But that wasn't true
in the 1950s.
The cost of failure now
is small.
The cost of failure back then
was enormous.
It must have been scary as hell.
NEWSREEL ANNOUNCER:
Today a new moon is in the sky,
a 23-inch metal sphere placed
in orbit by a Russian rocket.
NARRATOR:
The news stunned America.
On October 4, 1957,
the Soviet Union successfully
launched Sputnik,
the first space satellite,
dealing a powerful technological
blow to the United States
and intensifying the anxieties
of the Cold War.
McKENNA:
There was this underlying fear
that existed
that we were imminently
going to be at war with Russia,
and that it was probably going
to be a nuclear war.
Once they were able
to demonstrate
that they could
put a payload into space,
that said that probably we were
much more vulnerable
as a country.
ROCK:
The Russians had just beaten us
at our own game,
and I think everyone
in this country
was just befuddled by it.
How could this happen?
How could they beat us?
DOUGLAS EDWARDS:
The course of United States
policies
in the competition with Russia
has been severely shaken.
This is Douglas Edwards.
Good evening.
JACK YELVERTON:
Sputnik caught the attention
of everybody.
All of a sudden there was
a real recognition
that we needed to be a more
technically oriented society.
NARRATOR:
In the wake of the Sputnik
launch,
President Eisenhower signed
the National Aeronautics and
Space Act, establishing NASA.
The agency began operations
in October 1958;
within two years, its budget
would top $400 million a year.
For recently incorporated
Fairchild Semiconductor,
the nation's new obsession
with technology
would prove the business
opportunity of a lifetime.
The space race is on
and the federal government
suddenly has an insatiable need
for precisely what these guys
are going to start building.
NARRATOR:
Fairchild Semiconductor
Soon-to-be manufacturer
of silicon transistors
Set up shop just down the road
from Shockley,
renting out a concrete slab
of a building
that amounted to little more
than walls and a roof.
MOORE:
At Fairchild,
we had a clean slate.
We had an empty building
and we could do it
the way we now thought was
the right way to do it.
LAST:
The building had no electricity,
phones, water.
We didn't have any toilets.
We had to go to the gas station
down the street.
A main topic of discussion
always was,
"How soon are we gonna get the
power and be able to start in?"
YELVERTON:
There were challenges and
problems everywhere.
You had to build the equipment
that you needed to make
these transistors.
It was a whole brand-new world
that nobody had been there
before.
LAST:
We had the basic technology,
but all of the details
we had to do ourselves
and invent ourselves.
I remember the group of us
cleaned up the floor and said,
"All right,
now we're in business."
NARRATOR:
Fairchild Semiconductor
had barely opened its doors
when the team got wind of a
potential sales opportunity.
The Air Force had hired IBM to
build a navigational computer
for the new supersonic
B-70 bomber.
What the military needed
was silicon transistors
that were not only capable of
withstanding high temperatures,
but also fast switching.
The most likely supplier
was the largest semiconductor
manufacturer in the country,
Texas Instruments or TI
But the silicon devices
TI was making were too slow.
IBM invited the upstart
Fairchild
to bid on the contract.
A meeting was set up at IBM's
Federal Systems Division
in Owego, New York.
For the Fairchild founders,
there was no question that
Robert Noyce would be the one
to make their pitch.
YELVERTON:
Bob had the ability
to charm anybody.
He had a great smile,
he had a quick wit.
And when he walked into a room,
people would sit up
and pay attention.
BERLIN:
Fairchild at this point was
three months old,
in talks with IBM, one of the
great companies in the country.
NARRATOR:
The device the military wanted
pushed the bounds
of existing technology.
To date, no electronics company
had built a single one.
IBM needed a sample batch
of a hundred.
IBM laid out the specification
they needed.
And they turned to Bob.
BERLIN:
One would expect that Noyce
might be
a little bit quaking in his
boots when he hears,
"Well, the only way you can get
this contract
is if you can build a hundred
of these."
SPORCK:
Bob's thinking about it
and he says,
"Yeah, we could do that."
Now, you understand,
they hadn't made
they hadn't built
this transistor yet.
NARRATOR:
Noyce's confidence won
Fairchild the contract
And the fledgling company's
chemists and engineers
went to work.
They had already decided
to split into two R&D teams,
and now, under intense
deadline pressure,
they were racing
against one another
to develop a transistor
that met IBM's specs.
It took five months,
but in July 1958,
Fairchild fulfilled
its first order:
100 silicon transistors
at $150 each
30 times the going rate for the
less-sturdy germanium standard.
LAST:
We hadn't thought about how
you shipped the device.
So I went down
to the supermarket
and got a Brillo box.
And the first product went
to IBM in a Brillo box.
When IBM starts buying your
transistors and using them
in their equipment,
that tells the rest of the world
that you've got something.
LAST:
When I look back on it now,
I'm just flabbergasted
that we did what we did.
We took the basic Bell Labs
technology
and turned it into a product
that nobody in the world
had ever made before.
We went to our first trade show,
and we got an enormous
reception.
NARRATOR:
As a triumphant Noyce put it
to the Fairchild staff,
"We scooped the industry."
NOYCE:
I grew up in small-town America,
which had to be self-sufficient.
If something was broke,
you fix it yourself.
We didn't have
the expertise around,
so we all had to be experts.
MALONE:
Noyce comes from a generation
that we won't see again
in the electronics industry.
These are people that grew up
in a world without electronics.
Where they got their technical
chops, it's almost magical.
Dad may have bought a ham radio,
they may have had an affinity
to working on equipment
on a farm.
But what's interesting
about them is they all share
those sort
of middle-American values.
They were basically honest, they
were as good as a handshake.
There was a constant tension
between being masters
of the universe
and living in small-town life.
That tension drove
these guys on.
NARRATOR:
Right out of the gate,
Fairchild Semiconductor
had managed to capture
the industry's attention.
But building a cutting-edge
transistor
was only half the battle.
The key to success was being
able to mass-produce it.
LAST:
Our main goal was just
figuring how to make
a lot of these things
Reliably and in short order.
SPORCK:
When you're building
an automobile,
100% of the time
the car comes out.
When you're building
semiconductors,
sometimes a chip comes out
that works.
Frequently, nothing comes out.
MALONE:
Chip yields
The amount of chips
that actually worked
when they came off the line
Were going up and down
unpredictably.
There are stories where they
discovered it was because
there were farm fields outside,
and whenever they put down
pesticide,
it would affect
the yields on chips.
The yield would change with
the water level in the ground.
If men didn't wash their hands
after going to the bathroom,
the uric acid crystals would
wipe out hundreds of chips.
It was an incredibly
crude process.
NARRATOR:
The select few working
transistors had to be mounted,
connected to lead wires,
and put in casings
A delicate, labor-intensive task
performed almost exclusively
by women.
YELVERTON:
It was just a given
in the industry at that time.
The belief was that women were
used to doing needlework
and working closely
with their hands,
and they had better hand-eye
coordination.
GINGER JENKINS:
It was all manual dexterity.
My starting job at Fairchild
was called a die-attacher.
A die is a tiny little
silicon chip.
I attached them to the package,
with the gold layer
under the silicon piece.
And then after I was done
it would go to the bonder,
who would attach
little wires to it.
LAST:
When our devices came along,
there was an instant
acceptance of them.
It was the ideal component
The small size and weight,
the high performance,
the ability to perform
under very high temperature
requirements.
The only thing we had
to figure out to do,
we knew they had to be reliable.
NARRATOR:
The reliability of Fairchild's
product was put to the test
in 1958, when the upstart
company beat out
its more established rival,
Texas Instruments,
to supply transistors
for the guidance system
on the Minuteman nuclear
ballistic missile.
SPORCK:
The Minuteman program
was a godsend for us.
The military was willing to pay
high prices for performance.
How does the small company
compete against the giant TI
or Motorola?
It has to have something unique.
And then it has to have
an outlet.
Certainly the military market
was very important for us.
NARRATOR:
For the military,
reliability was essential,
and the first Fairchild
transistors did not measure up.
An alarming number of devices
had to be returned
to the company
for so-called "random
catastrophic failure."
Lab tests revealed that
it took nothing more
than a sharp tap with a pencil
to make the transistor stop
working altogether.
LAST:
Here we had the product
that scooped the industry,
and all of a sudden we didn't
have a reliable product.
We realized that when we were
sealing these up,
little specks of metal would be
loose inside the can
and short out the device
sometimes.
We were really running scared.
It would have been the end
of the company.
We needed to solve the problem.
NARRATOR:
For more than a year,
physicist Jean Hoerni
had been working on a radically
new transistor design:
a thin, protective layer
of silicon oxide
mounted on top
of the transistor.
Now, he and Noyce believed
its time had come.
The concept moved quickly
from sketch to basic component,
and then was rigorously tested
and refined.
In a nod to its flat top,
Fairchild dubbed Hoerni's
innovation the "planar process."
The method not only solved
the reliability problem,
it actually improved
the transistor's
overall performance.
YELVERTON:
The planar process was
a major step forward
in the ability to make
silicon transistors.
Using the planar process,
you had a very clean and more
highly reliable transistor.
You could increase your yields,
you could reduce your costs
and make a much better product.
NARRATOR:
Fairchild immediately
took out a patent.
SPORCK:
With the planar process,
all hell broke loose.
Everybody else had to come
to our door
and plead with us
to get a license.
NARRATOR:
As orders began pouring in,
Fairchild Camera and Instrument
decided to exercise its option
to buy its upstart subsidiary.
Each of the eight co-founders
of Fairchild Semiconductor
received stock options
worth almost $300,000
Roughly $2 million today.
"The money doesn't seem real,"
Noyce told his father.
"It's just a way
of keeping score."
MALONE:
If you look close enough
at history,
most inventions are not
out of the blue.
They tend to arise
out of a milieu
where the time
for that invention has come.
In the late 1950s,
we had the transistor.
It's now being sold
in the millions.
It's got one problem:
it's a discrete device.
It does one thing,
and if you want to do
two things,
you have to have two of them.
And if you want to build
a big computer
that does 10,000 things,
you've got to have
10,000 transistors.
BERLIN:
The more of these
discrete components,
the number of connections
between them
grows exponentially.
So you could end up
in a situation
where you could have all
of the independent components
testing out as working,
and you could have
the circuit fail
because the connections between
the components were failing.
So there were efforts
all over the country,
people trying to figure out,
"How can we somehow,
"at the same time that
we build these components,
how can we also connect them to
each other in a single device?"
Military might depended
on being able to build
these rockets and missiles,
and so the Department of Defense
was willing to pay
almost anything
for a lightweight,
reliable circuit.
NARRATOR:
The answer, when it came,
caught Fairchild off-guard.
In March 1959, at an industry
trade show in New York,
Texas Instruments announced
that it had patented
an entire circuit on a single
semiconductor chip,
effectively trouncing
the competition.
Designed the previous fall
by an engineer named Jack Kilby,
TI's so-called "solid circuit"
spurred Fairchild to action.
"We were working day to day,"
Noyce recalled,
"to try and get
a competitive edge."
JERRY SANDERS:
At the time,
TI was the biggest company
in the world in semiconductors.
Fairchild was just
a, you know, peanut,
and wanted to beat TI.
I was at an industry show,
and I ran into a manager
from Texas Instruments.
I walked up to him
and shook his hand,
or tried to shake his hand.
He looked at me like,
you know, I was garbage,
and said, I'll never forget it,
"Fairchild, we're gonna
crush you guys."
And I thought, "Wow!
That is really weird!"
So there was just
a lot of hysteria
against, you know, Fairchild
as it was making its way.
NARRATOR:
As head of R&D, Robert Noyce
had been thinking
about ways to connect components
for some time.
In fact, two months
before TI's announcement,
he'd sketched some ideas
in his lab notebook
for a device that would come
to be called
"the integrated circuit."
LES VADASZ:
The integrated circuit idea
is that,
hey, you don't have to have
individual devices.
You can have all these devices
in one piece of silicon
and interconnect them
right on that silicon chip.
NARRATOR:
Building on Fairchild's
planar process,
Noyce's design linked individual
components together
with tiny metal lines
printed right on the protective
oxide layer.
Kilby's design, by contrast,
relied on thin gold wire
painstakingly threaded
between the components by hand.
SANDERS:
Jack Kilby just wired them
together.
Bob Noyce said, "No wires."
In no way do I want to demean
Jack Kilby's work.
I mean, you know,
it was fantastic.
But it wouldn't have been
practical for mass production.
ROGER BOROVOY:
I've worked with a lot
of brilliant people in my career
and, uh, he is at the top.
He had a way
of integrating facts
and coming up with something
you'd never expect.
NARRATOR:
Now, jolted by TI's news,
Noyce hurriedly resurrected
his notebook sketches.
LAST:
Bob and I got together and said,
"We have to show
the flag somehow."
So I made some crude devices
that we had
at one of the trade shows.
NARRATOR:
Noyce filed a patent for his
integrated circuit in July 1959.
By then, he'd been promoted
to general manager
of Fairchild Semiconductor,
and with his new authority,
he put physicist Jay Last
to the task of figuring out
how to build
a commercial device.
VADASZ:
The devil is in the detail.
The concept is one thing;
the other thing is
to make it work
in a manufacturing environment
where you can just turn out
millions and millions of them.
NARRATOR:
It took two years,
but in March 1961,
Fairchild introduced its first
commercial integrated circuit,
called Micrologic.
At $120, Micrologic
was far out of reach
for the average private company.
But when President
John F. Kennedy
announced an ambitious
new space program in May,
it was clear that
the federal government
would be willing to pay for it.
KENNEDY:
These are extraordinary times,
and we face an extraordinary
challenge.
I believe that this nation
should commit itself
to achieving the goal,
before this decade is out,
of landing a man on the moon
and returning him safely
to the earth.
NARRATOR:
At a time when
the average computer
was a room-sized machine
containing mile upon
tangled mile of wires,
Fairchild's integrated circuit,
or microchip,
made it possible
to put a computer
right on board a spacecraft
and send it all the way
to the moon.
YELVERTON:
This was one of those
really important
disruptive technologies,
that this was something that was
going to change everything
in electronics.
(explosion)
BERLIN:
Brilliant people with brilliant
ideas exist all the time;
it's just a question
of being a brilliant person
with a brilliant idea
in the right place
at the right time,
where people want
what you've come up with.
NARRATOR:
Fairchild landed the contract
to supply chips for NASA's
Apollo Guidance Computer.
Meanwhile, other semiconductor
manufacturers
began to license
Fairchild's technology
and build integrated circuits
based on the planar process.
By 1962, Fairchild Camera
and Instrument
was reporting the highest sales
and earnings in its history,
and rival Texas Instruments
was crying foul.
TI filed suit against Fairchild
for patent interference,
claiming ownership of the
integrated circuit concept.
BOROVOY:
Texas Instruments said,
"We think we invented that."
Kilby certainly was first,
but Kilby's circuit
was not a practical one.
MALONE:
This is one of those cases
of simultaneous invention.
Kilby has time precedence,
but Noyce's design
is the one that worked.
NARRATOR:
The suit would drag on
for years.
In the end,
Fairchild and Texas Instruments
would agree to share licensing
of the integrated circuit.
By that time, TI itself
was building microchips
based on Fairchild's
planar process technology.
HADLEY:
I was driving down 101,
and at the side of the road
there was a large billboard
with a sun rising,
and it said something
to the effect that
Santa Clara County has more
Ph.D.s in high technology
than any place in the world.
And a light went off,
it was an epiphany,
and I said, "That's it,
I'm going to go into high tech."
NARRATOR:
Throughout the early 1960s,
thousands of young men and women
poured into the Santa Clara
Valley every month,
lured by the booming electronics
and defense industries.
And though each passing year
brought new companies
into being
And with them, new jobs
Fairchild Semiconductor was one
of the valley's biggest draws.
VADASZ:
I was working at Transitron,
and I really wanted to come
to Fairchild
because at that time, that's
where things were happening.
SANDERS:
The technology at Fairchild
blew me away.
To see what they were doing
at Fairchild when I went there,
I was in awe.
These were the smartest people
I'd ever met.
NARRATOR:
Critical to Fairchild's appeal
was the unique corporate culture
that Robert Noyce encouraged.
YELVERTON:
Bob had a very good idea
of how the company should behave
as a company.
He had some pretty
egalitarian ideas;
he wanted to break down
the distinctions
between management
and workforce.
McKENNA:
Bob managed by camaraderie.
He believed in teamwork,
and to him everybody at
Fairchild was part of the team.
HADLEY:
It's what you could contribute
that really counted the most.
Everybody was highly competitive
to do the best in their job,
to make their company the best.
Why would we work
ten-, 12-hour days?
It wasn't because somebody
told us we had to.
We wanted to.
SPORCK:
We were bullish about where the
electronics were going to go.
We did not have any hesitation
about unlimited growth forever.
MALONE:
The atmosphere
of the early Fairchild
was a combination of a college
dormitory or frat house
with sort of like a country club
locker room.
It was basically a bunch of men
in their 20s
starting to make real money
competing with each other
on who had the bigger swagger.
It either had to settle down
and just become another company,
or it had to blow up.
It was just too volatile.
It was just too much talent
stuffed into one place.
NARRATOR:
Even as it enjoyed
its meteoric rise,
Fairchild Semiconductor
was beginning to unravel
at its core.
By 1962, fully half
of the founding team
Including Jay Last
and Jean Hoerni,
as well as numerous researchers
and engineers
Had left the company
to start new ventures,
most of them positioning
themselves as direct competitors
for the integrated
circuit market.
GEORGE MOORE:
It just exploded.
Every time we came up
with a new idea,
we spawned two or three
companies to try to exploit it.
NARRATOR:
Over the next two decades,
Fairchild would spin off
more than 100 new firms,
including Rheem, Signetics,
Molectro, Amelco,
General Microelectronics,
Advanced Micro Devices.
In the Santa Clara Valley, they
were known as "Fairchildren."
McKENNA:
There was constant startups.
Almost every company
had employees
coming out of Fairchild.
They were educating people
in this new era of silicon.
As people began to develop
their skills and knowledge,
the whole idea
of venture capital
also was starting
to grow and prosper.
You knew how to build a product,
because you were doing it.
It was strictly a matter
of finding the money
and taking the risk.
MALONE:
In the '60s at Fairchild,
everybody looks out there
and says,
"Why are we sitting
in the big city?
"We should be out there
panning for gold.
Let's go start
our own chip company."
Fairchild was like a seedpod,
and it just scattered new
companies all over this valley.
And that's what really began
what we think of as
the modern Silicon Valley.
NARRATOR:
By the mid-'60s,
Fairchild Semiconductor
was raking in massive profits
for parent Fairchild Camera
and Instrument.
In its first seven years,
the semiconductor division
had opened nine new
manufacturing plants,
including one in Hong Kong.
And at a time when NASA
was buying
60% of the integrated circuits
produced in the United States,
Fairchild was a major supplier,
shipping some 100,000 devices
for the Apollo space program
in 1964 alone.
Robert Noyce wasn't satisfied.
It was all well and good
to put Fairchild's microchips
at the disposal
of American astronauts,
but Noyce's real target
was the American consumer.
BERLIN:
Noyce and his colleagues
saw an expanse open
in front of them,
a world where electronics
were getting faster
and smaller and cheaper,
and this could mean anything.
Noyce just had this notion
that this little thing
that he had helped to invent
was going to change the world.
NARRATOR:
In the spring of 1965,
Noyce made an announcement
at an industry convention
that stunned even his staff:
Fairchild was slashing the price
of its most popular
integrated circuit.
The microchips would sell
for just a dollar apiece,
less than what it cost
a manufacturer
to buy the components
and assemble them.
What alarmed Noyce's team
was that the price
was also less than it cost
Fairchild to make them.
YELVERTON:
There's a principle
that is pretty consistent
in the electronics business
that the first product
that you make
is very, very expensive,
and each additional unit
that you make
brings the cost down
just a little bit.
MOORE:
Bob was taking a risk that
made us all gulp at the time,
but it turned out to be
the proper solution.
NARRATOR:
As Noyce expected,
demand soared,
production costs plummeted,
and before long,
Fairchild was turning a healthy
profit on commercial sales.
VADASZ:
Bob Noyce always looked forward.
I think he was confident
with risk.
McKENNA:
Leaders break the rules.
That's what they do.
And I think he understood
that principle,
that whole cultural attitude
of pushing the edges,
of pushing the technology
to where it's innovative
and thinking about things that
people hadn't thought before.
HADLEY:
It was exciting.
You know, our hearts and
passions were really in our job.
And we knew that
this was a force
that was just changing
everything.
NARRATOR:
Maybe it was the thrill
that came from always hovering
on the edge of discovery.
Maybe it had to do with being on
the literal edge of the country
and a continent away
from the old rules.
But by the mid-1960s,
the Santa Clara Valley
was about as charged a place
as any physicist or engineer
could ever hope to find.
MALONE:
We talk about the early era
of Silicon Valley
as being cowboys and Indians
and the Wild West show,
and it really was.
SANDERS:
It was a wild time.
People just drank too much.
I just remember that
three gin and tonics
should have been my limit.
And the bar of choice
was the Wagon Wheel.
SPORCK:
We just got in the habit
of going over there
for a beer on the way home.
Sometimes it was more than one.
HADLEY:
It was very, very crowded.
Everybody from presidents
and CEOs down to line workers,
and everything in between.
SPORCK:
It got to be a hangout
not just for Fairchild people,
but the spinoffs from Fairchild.
I mean, we all worked together,
even though we were competitors.
We'd go in there and everybody
was bragging about,
"I took that job away from you
down there at Hughes," you know.
"You guys had it
and I took it away."
I mean, it was just a marvelous
environment of young guys
having a good time
competing with each other.
SANDERS:
Conversations were just rampant
about the latest
sputtering device
or the latest piece
of epitaxial equipment.
It was almost like a salon,
you know, everybody talking
about what was going on,
who was working where,
who was doing what.
JENKINS:
You could make friends or lose
friends at the Wagon Wheel.
I mean,
it was a hub of networking.
SPORCK:
There were always
a lot of girls
from the factory there too,
which is not all good.
HADLEY:
There was a lot of hanky-panky
going on.
I remember thinking
that the divorce rate
was probably 150%,
not just 100%,
because a lot of the second
marriages didn't make it either.
SANDERS:
We just all were very excited
about building our business,
building an industry.
So there was a sense that
we're all in it together.
What was good for one
was good for all.
MALONE:
Fairchild was one of a kind.
They were hugely talented,
they were first in,
and they moved really,
really fast.
Motorola was chasing them,
Texas Instruments
was chasing them,
the big companies like IBM with
their microelectronics units
were chasing them,
and nobody could catch Fairchild
because they were just
so creative and so brilliant.
But they were destined
at some point to stumble,
and the moment they stumbled,
everybody ran right over
the top of them.
(bells ringing)
NARRATOR:
In 1965, Fairchild
Camera's stock
rose faster than any other
on the New York Stock Exchange.
"All the excitement,"
Time magazine reported,
"is over one division,
the Semiconductor branch."
YELVERTON:
Fairchild Semiconductor
really became the tail
that wagged the dog.
It produced most of the profits
and all of the growth
for Fairchild Camera.
NARRATOR:
Increasingly,
success bred discontent
and a simmering resentment
toward Fairchild's
parent company.
At the top of the list
of complaints
was the fact that
semiconductor profits
did not get reinvested
in the division's growth.
SANDERS:
As a result, companies like
Texas Instruments particularly
were catching up
with Fairchild technology.
As was Motorola,
they were catching up.
And so, with less funding
for R&D
and less funding
for new plants and equipment,
it was frustrating.
MALONE:
These guys on the West Coast,
they're looking at millions and
millions of dollars being made,
metaphorically being put into
a Brinks truck and driven east,
and they're not getting
a piece of their success.
NARRATOR:
For Noyce, it was a source
of deep frustration.
He had the power to direct
the semiconductor division
and the responsibility
for its performance,
but no ability
to reward his staff.
YELVERTON:
We tried very hard
to get Fairchild
to think in terms of using
more creative compensation,
including the idea
of a stock option program.
They thought we were a bunch
of dreamy-eyed socialists.
NARRATOR:
Worst of all, in-fighting
and a lack of communication
between the R&D
and manufacturing departments
left the company scrambling
to fulfill its orders.
ANDY GROVE:
The research lab
and the manufacturing location
were seven miles apart.
Those seven miles, from the
standpoint of collaboration,
could have been 7,000 miles.
BOROVOY:
Things were not good.
The company was floundering;
products were very, very late.
Bob was not a day-to-day manager
by any stretch
of the imagination.
He knew that was not
what he did well.
GROVE:
I had nothing but unpleasant,
discouraging dealings with him
as I watched Bob manage
a troubled company.
MALONE:
I think one of the problems
Fairchild got into
was Noyce trusted people
maybe too much,
so that the company oftentimes
became unharmonious.
GROVE:
If two people argued and we all
looked to him for a decision,
he would put a pained look
on his face
and maybe said something like,
"Maybe you should
work that out."
More often he didn't say that,
he just changed the subject.
SPORCK:
Bob's biggest problem is he had
great difficulty saying "no."
If two department heads
had different opinions
as to what they wanted to do,
it was whoever was there last
got the right decision,
because he always gave you
a "yes."
NARRATOR:
As the internal strife mounted
and earnings plunged,
Fairchild began to splinter.
In March 1967, Noyce's
right-hand man, Charlie Sporck,
announced that he was leaving
to head up a competitor:
National Semiconductor.
MALONE:
That stunned Fairchild.
And when Sporck left
and went to National,
he began to raid Fairchild
for talent,
and these guys
all started going to National
and they were all getting
stock options.
And they were succeeding.
That was the real eye-opener.
SPORCK:
You're not completely pleased
with the corporate office,
and you got these guys leaving
and starting companies,
and the companies
are running, working.
You get a look around
and look in the mirror and say,
"Well, you know, how about you?
What are you gonna do?"
I know now that Bob was thinking
the same thing.
NARRATOR:
Gordon Moore, chemist and
director of the R&D department,
was the first to hear
of Noyce's plans.
MOORE:
Bob came to me and said, "How
about starting a new company?"
Well, my first reaction was,
"Nah, I like it here."
And then a couple of months
later he came back and said,
"I'm leaving.
How would you like to start
a new company?"
Which put a whole different
light on the thing.
NARRATOR:
Noyce and Moore resigned from
Fairchild in the summer of 1968.
Noyce was 40, Moore, 39.
As Noyce put it in a letter
to Sherman Fairchild,
his aim was to "get close
to advanced technology again"
and to enjoy "more personal
creative work
"in building a new product,
a new technology
and a new organization."
MALONE:
The history of Silicon Valley
is people going to startups,
leaving really nice jobs
that pay really well,
and taking this gigantic leap
to see if they can make
something important happen,
be valuable, and in the long run
maybe even get rich.
Noyce is the prototype of that.
The Noyces of the world didn't
get into this to have a job.
They got into this
to create a reality
and to be in control
of that reality,
even if it meant
giving everything up
and starting from scratch.
(faint voices over radio)
NARRATOR:
The images captivated the world.
On July 20, 1969,
12 years after the Russians
had shamed America with Sputnik
and just eight
after President Kennedy
had challenged the nation
to go to the moon,
there was astronaut
Neil Armstrong,
stepping onto the lunar surface.
ARMSTRONG:
That's one small step for man
NARRATOR:
The scale of the achievement
was obvious.
What was less apparent to the
half a billion people watching
was that the success
of Apollo 11
had hinged on the integrated
circuit technology
invented by Fairchild.
SPORCK:
At the time of the moon landing,
I was in Paris on a sales trip,
and all of the TV stores
had the TVs on,
and there were pictures
of the Americans on the moon.
It was a very great,
patriotic feeling
as well as a feeling
that it's our technology
that's doing that.
It was a good deal.
(crowd cheering)
MALONE:
1969 really is that miracle year
in 20th century
American history.
It's the moon landing;
it's Woodstock.
(guitar solo playing)
At the time we thought,
"Wow, these are epochal events
taking place around us
and we're here for it."
And even while they were
battling over People's Park
and rioting in the streets
in San Francisco
and protests at Stanford,
what we weren't noticing
just a few miles away
were the guys sitting
in laboratories
inventing stuff that really did
change the world
and will continue to change
the world for centuries to come.
NARRATOR:
By the time of the moon walk,
Robert Noyce and Gordon Moore
had been in business a year.
Starting up had been a breeze.
With their legendary status
in the industry,
they'd easily secured financing,
raising $2.5 million
in less than two days.
They'd also managed to lure
many of the best and brightest,
among them Andy Grove,
a Hungarian-born
chemical engineer
who had joined Fairchild's
R&D division in 1963.
Now, he would serve
alongside Noyce and Moore
as the new venture's
director of operations.
GROVE:
Bob didn't know me well enough
to have a real opinion.
But Bob trusted Gordon,
and Gordon thought
I was pretty good.
MALONE:
The smartest hiring I think Bob
ever did in his life
was hiring Andy Grove,
because as good as the fit was
between Noyce and Moore,
there was one thing lacking,
and that was that drive
to make the company function
at its highest capability
on a day-to-day basis.
Neither one of those guys
was tough enough for that job.
ANN BOWERS:
Andy was the guy who made sure
the trains all ran on time.
He was a taskmaster.
He had very strong views
about what you should do
and what you shouldn't do,
and he was very direct
about that.
NARRATOR:
They'd called their new company
"Intel,"
an abbreviation of
"integrated electronics,"
which also happened to conjure
the word "intelligence."
McKENNA:
It did not get a great deal
of attention in the media,
but there was just a buzz,
particularly here in the valley.
There was an expectation that
they were going to do something
that was unique and different.
NARRATOR:
Believing computers
to be the future
of the semiconductor industry,
Noyce and Moore had decided
to produce memory devices
and to challenge
the dominant technology,
magnetic core memory,
with a product based on
Noyce's integrated circuit.
They'd given themselves
two years to make a profit,
and the clock was ticking.
GROVE:
I had horrible nightmares.
Do all this with a ragtag crew
that never worked
with each other,
run by somebody
who never ran things like this.
I never took a business course.
I was inventing what to do
as we went along.
This was not easy.
NARRATOR:
Those first years,
Noyce would later say,
were like "walking the thin line
next to the cliff of disaster."
Noyce found it exhilarating.
His mantra now was innovation,
and everything about Intel
had been designed
to encourage it,
from the companywide
stock options
to the open-plan office.
MALONE:
And I remember walking in
at Intel headquarters,
and I couldn't find Noyce.
A secretary had to come out
and lead me to his cubicle,
because his cubicle
was almost indistinguishable
from all the other cubicles
in this vast prairie dog town
of cubicles.
Here's the living legend,
but he looked like
a middle manager
at a division of some Midwestern
manufacturing company.
BOWERS:
At Intel, there were
no privileges anywhere.
We started a form
of company culture
that was completely different
than anything had been before.
You worked hard and delivered,
and that improved your life
in a variety of ways.
It was a culture of meritocracy.
NARRATOR:
For Noyce, Intel was an answer
to years of chafing at the
strictures of corporate life,
from his experiences at Philco
and Shockley Laboratories
to his dealings with Fairchild's
parent company.
TED HOFF:
The idea is people
should not have to go up
through a chain of command.
If you need to talk
to a particular manager,
you go to him
and you talk to him.
To get away from the hierarchy
that was characteristic
of really large corporations
where everything has to be done,
you know,
in a very rigid manner.
That very democratic society
was something that Bob promoted.
And then Andy found a way
to keep it,
but keep it with discipline.
MALONE:
The guys at the top,
especially Noyce,
trusted the wisdom of all
the employees in the company.
In their minds, innovation
could come from anywhere,
and they were open to it
coming from everywhere.
NARRATOR:
In the spring of 1969,
as Intel engineers
continued to tinker with
the design of their memory chip,
the fledgling company
scored a contract
that would alter its course.
The Japanese firm Busicom
hired Intel
to design 12 specialized
microchips
for its new calculator,
and almost immediately,
a young engineer named Ted Hoff
raised a red flag.
HOFF:
The more I learned
about this design,
the more concerned I became
that Intel may have undertaken
more than it was prepared
to deliver.
The number of chips
and their complexity
was much greater
than I had expected.
And Bob said, "Well, if there's
anything you can think of
to simplify the design,
why don't you pursue it?"
BERLIN:
Noyce always encouraged
the people in his labs
to run with their ideas
and see where they went.
NARRATOR:
Hoff's concept was radical;
he envisioned a single chip
that could be programmed
for a specific application
In this instance,
to function as a calculator.
Noyce saw the potential
for much more.
With Hoff's chip,
the guts of a computer
A machine that in 1969
was still more or less
the size of a refrigerator
Could be shrunk down
to fit on a fingertip.
With a push from Noyce, Hoff's
invention would lead directly
to the world's first
microprocessor: Intel's 4004.
Introduced in 1971
and containing more than
2,000 transistors,
the device was advertised
as a "computer on a chip."
The digital revolution
had officially begun.
SANDERS:
Probably the most
important invention
of the last hundred years
was the microprocessor,
which is basically
the fundamental driving force
and brain of all of the digital
equipment we use today.
Whether it's an iPhone,
a computer, you know,
a notebook, you know, a tablet,
whatever it is, basically it's
built around a microprocessor.
MALONE:
That's the defining product
of the modern world.
There's never been
a proliferation
of a new technology
that fast in human history.
MOORE:
It's been successful
beyond anything
we possibly could have imagined
in the beginning.
And the result has
really revolutionized
the way people live.
SANDERS:
The microprocessor is now
a $100 billion industry
and underlies the entire
information technology world.
The microprocessor, of course,
is a collection of thousands,
hundreds of thousands,
now millions of transistors.
There's no way that those would
have been possible
without Bob Noyce's invention
of the integrated circuit.
MALONE:
I think you can credit Bob Noyce
for being the first
technology entrepreneur CEO,
in the sense that he built
a company
that was wholly dedicated
to being on the absolute cutting
edge of technology, perpetually.
The zenith of that
is probably Apple Computer
in the 21st century.
The prototype for that is Intel
in the 1960s and '70s,
where you build a company that
is purely technology driven.
You're not even sure
what industries
you're going to be building for
after a certain point.
You're just driving
the technology forward
at breakneck pace
and seeing what emerges
from it all
and then coping with it.
It's a very, very interesting
business model
that never existed before
and really begins with Intel.
NARRATOR:
By the time Intel introduced
the microprocessor,
the Santa Clara Valley
bore little resemblance
to the verdant farmland
it had been 15 years earlier
when William Shockley
set up shop.
The number of high-technology
jobs in the area
had increased tenfold
since 1959,
and the population of San Jose,
the valley's largest city,
had more than doubled
to nearly half a million.
As consumer applications
for the microprocessor
began to proliferate,
venture capitalists rushed in,
gradually replacing
the military and NASA
as the financial backbone
of the industry.
No longer would the area
be referred to
as the "Valley
of Heart's Delight."
After 1971
That banner year for Intel
It would increasingly be known
as "Silicon Valley,"
a name soon to be synonymous
with risk,
technological innovation
and a new brand
of the American Dream.
MALONE:
This valley is
perpetually young.
It's always made up
of the next generation
of bright young entrepreneurs
showing up,
having
their "killing Dad" moment
of the previous generation
of valley executives,
and they start
their own companies.
We're not real big on history
around here.
We don't look back very much.
SANDERS:
In Silicon Valley,
innovation is everything.
How are you different?
How are you better?
The rest of it is gut-busting,
hardworking engineering.
But the idea to do something
so different
that's the magic of Silicon
Valley then and now.
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