Global Dynamics of the Semiconductor Revolution: A Tale of Three Nations
The eighth chapter of “Chip War” delves into the Soviet Union’s attempt to build its own microelectronics center, Zelenograd, under the leadership of Nikita Khrushchev. The Soviet Union, armed with an integrated circuit brought back by Soviet student Boris Malin from Pennsylvania, embarked on a strategy of copying the integrated circuit one-for-one without deviation. This strategy, overseen by Alexander Shokin, the bureaucrat in charge of Soviet microelectronics, was implemented without a full understanding of its implications. Despite having some of the world’s leading theoretical physicists and the Nobel Prize-winning inventor of integrated circuits, Jack Kilby, the Soviet production process lacked the sophistication and purity needed to mass-produce chips reliably.
The Soviet Union’s strategy of copying old designs condemned them to backwardness, as the cutting edge of semiconductor technology was constantly changing, as per Moore’s Law. Texas Instruments and Fairchild were introducing new designs with more transistors every year, making the earliest integrated circuits obsolete. The size of transistors and their energy consumption were shrinking while computing power packed in a square inch of silicon doubled roughly every two years. The Soviet leaders failed to understand that their “copy it” strategy meant that they started several years behind the US, never catching up due to a lack of creativity and market exploration, with civilian products being an afterthought amid military production focus.
The ninth chapter of “Chip War” shifts the focus to Japan, marking the rise of Japan as an economic power symbolized by the presentation of a Sony transistor radio by Japanese Prime Minister Hayato Ikeda to French President Charles de Gaulle. The US had a Cold War strategy of integrating Japan into its semiconductor industry and supporting the rebuilding of its economy. This allowed Japanese scientists access to important journals and research in the field, leading to the creation of electronics giants like Sony.
Sony, founded by Akio Morita and Masaru Ibuka, was focused on innovation and product design, rather than copying tactics used by other companies. Their first major success was the transistor radio, a product that had previously been attempted by Texas Instruments but was hampered by pricing and marketing errors. Throughout the 1960s, US chipmakers dominated the production of cutting edge chips, but Japanese firms, including Sony, paid hefty licensing fees for intellectual property rights and eventually became experts in devising consumer electronics. In the 1970s, Sharp Electronics revolutionized the calculator market, making most calculators Japanese-made. The interdependence between America and Japan involved both countries relying on each other for supplies and customers. The US built advanced computers while Japan focused on producing consumer goods, with semiconductors driving growth in consumption.
The tenth chapter of “Chip War” explores the gender dynamics in the early days of the semiconductor industry, where men were the primary designers while women were responsible for assembly. As the demand for semiconductors grew, the need for larger and cheaper labor forces also grew, leading to the rise of chip startups in the Santa Clara Valley south of San Francisco. Charlie Sporck, an expert in productivity optimization, was hired by Fairchild Semiconductor after a union revolt forced him to leave his previous job at GE. He implemented efficiency strategies and gave most employees stock options as an incentive for increased productivity levels.
In contrast to the electronics firms on the East Coast, most of the new chip startups in the Santa Clara Valley employed women to staff their assembly lines. The 1965 immigration law increased the foreign-born labor pool and made it easier for chip firms to hire women at lower wages and without demanding better working conditions. Production managers believed that smaller hands gave female workers an advantage when assembling and testing semiconductors. As demand continued to grow, chip firms began to look for even cheaper labor and opened facilities in locations such asMaine or on a Navajo reservation due to tax incentives. Bob Noyce even invested in a radio assembly factory near the border of Hong Kong, where wages were only 25 cents per hour. The Fairchild factory in Kowloon Bay, Hong Kong, became one of their most successful facilities, producing high-quality semiconductors thanks to the trained engineers running the assembly lines.
In conclusion, chapters eight through ten of “Chip War” provide a comprehensive exploration of the global dynamics of the semiconductor industry during a time of intense geopolitical competition and rapid technological advancement. The narrative takes us from the Soviet Union’s ill-fated attempt to build its own microelectronics center, to Japan’s rise as an economic power and a key player in the semiconductor industry, and finally to the gender dynamics and labor practices in the early semiconductor industry in the United States.
The chapters highlight the key figures, events, and strategies that shaped this industry, offering a deep understanding of the technological, economic, and geopolitical factors that drive the chip industry. The narrative underscores the role of visionary leaders like Nikita Khrushchev, Hayato Ikeda, Akio Morita, Masaru Ibuka, and Charlie Sporck, the impact of government strategies and policies, and the influence of competition between the United States, the Soviet Union, and Japan.
The chapters also shed light on the challenges and opportunities that these countries and companies faced, from the complexities of copying and mass-producing integrated circuits, to the potential of innovation and product design, and the burgeoning market for consumer electronics. The narrative also reveals the strategies and innovations that these countries and companies employed to overcome these challenges and seize these opportunities, from the development of new production processes and labor practices, to the invention of the transistor radio and the prediction of exponential growth in computing power, known as “Moore’s Law.”
Furthermore, the chapters illuminate the broader social and cultural context in which these developments took place, from the crisis of confidence in the Soviet Union following the launch of Sputnik, to the rise of Japan as an economic power and the presentation of a Sony transistor radio to the French President, and the gender dynamics and labor practices in the early semiconductor industry in the United States. The narrative also highlights the role of institutions like Fairchild Semiconductor and Sony, and the influence of individuals like Boris Malin, Alexander Shokin, and Bob Noyce.
Overall, these chapters of “Chip War” provide a fascinating insight into the global dynamics of the semiconductor industry, the countries and companies that shaped it, and the global competition and rapid technological advancement that drove it. They underscore the transformative impact of these developments on manufacturing, computing, and military power, and their enduring legacy in the form of the digital revolution and the rise of Silicon Valley.
