Fairchild Semiconductor International, Inc. was an American semiconductor company based in San Jose, California. It was founded in 1957 as a division of Fairchild Camera and Instrument by the "traitorous eight" who defected from Shockley Semiconductor Laboratory. It became a pioneer in the manufacturing of transistors and of integrated circuits. Schlumberger bought the firm in 1979 and sold it to National Semiconductor in 1987; Fairchild was spun off as an independent company again in 1997. In September 2016, Fairchild was acquired by ON Semiconductor.[4]
The company had locations in the United States at San Jose, California; San Rafael, California; South Portland, Maine; West Jordan, Utah; and Mountaintop, Pennsylvania. Outside the US, it operated locations in Australia;[5] Singapore; Bucheon, South Korea; Penang, Malaysia; Suzhou, China; and Cebu, Philippines, among others.
In 1955, William Shockley founded Shockley Semiconductor Laboratory, funded by Beckman Instruments in Mountain View, California;[6] his plan was to develop a new type of "4-layer diode" that would work faster and have more uses than then-current transistors. At first he attempted to hire some of his former colleagues from Bell Labs, but none were willing to move to the West Coast or work with Shockley again at that time. Shockley then founded the core of the new company with what he considered the best and brightest graduates coming out of American engineering schools.
While Shockley was effective as a recruiter, he was less effective as a manager. A core group of Shockley employees, later known as the traitorous eight, became unhappy with his management of the company. The eight men were Julius Blank, Victor Grinich, Jean Hoerni, Eugene Kleiner, Jay Last, Gordon Moore, Robert Noyce, and Sheldon Roberts. Looking for funding on their own project, they turned to Sherman Fairchild's Fairchild Camera and Instrument, an Eastern U.S. company with considerable military contracts.[7] In 1957 the Fairchild Semiconductor division was started with plans to make silicon transistors at a time when germanium was still the most common material for semiconductor use.
Fairchild's first marketed transistor was the 1958 2N697, a mesa transistor developed by Moore,[9] and it was a success. The first batch of 100 was sold to IBM for $150 apiece in order to build the computer for the B-70 bomber. More were sold to Autonetics to build the guidance system for the Minuteman ballistic missile.[10]
The planar process made most other transistor processes obsolete. One such casualty was Philco's transistor division, whose newly built $40 million plant to make their germanium PADT process transistors became nonviable. Within a few years, every other transistor company paralleled or licensed the Fairchild planar process. Hoerni's 2N1613 was a major success, with Fairchild licensing the design across the industry.
In 1960, Fairchild built a circuit with four transistors on a single wafer of silicon, thereby creating the first silicon integrated circuit (Texas Instruments' Jack Kilby had developed an integrated circuit made of germanium on September 12, 1958, and was awarded a U.S. patent, however Kilby's method was not scalable and the semiconductor industry adopted Fairchild's process to manufacture integrated circuits). The company grew from twelve to twelve thousand employees, and was soon making $130 million a year.
Fairchild's Noyce and Texas Instrument's Kilby had independently invented the integrated circuit (IC) based on bipolar technology. In 1960, Noyce invented the planar integrated circuit. The industry preferred Fairchild's invention over Texas Instruments' because the transistors in planar ICs were interconnected by a thin film deposit, whereas Texas Instruments' invention required fine wires to connect the individual circuits. Noyce's invention was enabled by the planar process developed by Jean Hoerni.[11] In turn, Hoerni's planar process was inspired by the surface passivation method developed by Mohamed Atalla at Bell Labs in 1957.[12]
Sales due to Fairchild semiconductor division had doubled each year and by the mid-1960s comprised two-thirds of total sales of the parent company. In 1966, Fairchild's sales were second to those of Texas Instruments, followed in third place by Motorola. Noyce was rewarded with the position of corporate vice-president and hence became the de facto head of the semiconductor division.
However, internal trouble at Fairchild began to surface with a drop in earnings in 1967. There was increasing competition from newer start-ups. The semiconductor division, situated in Mountain View and Palo Alto, California, was actually managed by executives from Syosset, New York, who visited the California sites once a year, even though the semiconductor division earned most of the profits of the company. Fairchild's president at that time, John Carter, had used all the profits to fund acquisitions of unprofitable ventures.
Noyce's position on Fairchild's executive staff was consistently compromised by Sherman Fairchild's faction. Charles E. Sporck was Noyce's operations manager. Sporck was reputed to run the tightest operation in the world. Sporck, Pierre Lamond and most managers had grown upset and disillusioned with corporate focus on unprofitable ventures at the expense of the semiconductor division. Executives at the semiconductor division were allotted substantially fewer stock options compared to other divisions. In March 1967, Sporck was hired away by Peter J. Sprague to National Semiconductor. Sporck brought with him four other Fairchild personnel.[21] Actually, Lamond had previously assembled a team of Fairchild managers in preparation to defect to Plessey, a British company. Lamond had recruited Sporck to be his own boss. When negotiations with Plessey broke down over stock options, Lamond and Sporck succumbed to Widlar's and Talbert's (who were already employed at National Semiconductor) suggestion that they look to National Semiconductor.[22] Widlar and Talbert had earlier left Fairchild to join Molectro, which was later acquired by National Semiconductor.[23]
In the fall of 1967, Fairchild suffered a loss for the first time since 1958 and announced write-offs of $4 million due to excess capacity, which contributed to a total loss of $7.6 million. Profits had sunk to $0.50 a share, compared to $3 a share the previous year, while the value of the stock dropped in half. In October 1967, the board ordered Carter to sell off all of Fairchild's unprofitable ventures. Carter responded to the order by resigning abruptly.
Sherman Fairchild hired Lester Hogan, who was the head of Motorola semiconductor division. Hogan proceeded to hire another hundred managers from Motorola to entirely displace the management of Fairchild.
Many of the original founders, otherwise known as the "fairchildren", had left Fairchild in the 1960s to form companies that grew to prominence in the 1970s. Robert Noyce and Gordon Moore were among the last of the original founders to leave, at which point the brain-drain of talents that had fueled the growth of the company was complete.
A Fairchild advertisement of the time showed a collage of the logos of Silicon Valley with the annotation "We started it all".It was later, in 1971, Don Hoefler popularizated the name "Silicon Valley USA" in Electronic News.[24] He notes he did not invent the name. See also Gregory Gromov[25] and TechCrunch 2014 update[26] of Hoefler's article.[24]
Hogan's action to hire from Motorola had Motorola file a lawsuit against Fairchild, which the court then decided in Fairchild's favor in 1973. Judge William Copple ruled that Fairchild's results were so unimpressive that it was impossible to assess damages "under any theory". Hogan was dismissed as president the next year, but remained as vice chairman.[27]
After Intel introduced the 8008 8-bit microprocessor, Fairchild developed the Fairchild F8 8-bit microprocessor, which was according to the CPU Museum "in 1977 the F8 was the world's leading microprocessor in terms of CPU sales."[29]
In 1976, the company released the first video game system to use ROM cartridges, the Fairchild Video Entertainment System (or VES) later renamed Channel F, using the F8 microprocessor. The system was successful initially, but quickly lost popularity when the Atari 2600 Video Computer System (or VCS) was released.
By the end of the 1970s they had few new products in the pipeline, and increasingly turned to niche markets with their existing product line, notably "hardened" integrated circuits for military and space applications and isoplanar ECL products used in exotic applications like Cray Computers.[30] Fairchild was being operated at a loss, and the bottomline subsisted mostly from licensing of its patents.
In 1979, Fairchild Camera and Instrument was purchased by Schlumberger Limited, an oil field services company, for $425 million. At this time, Fairchild's intellectual properties, on which Fairchild had been subsisting, were expiring.
In 1980, under Schlumberger management, the Fairchild Laboratory for Artificial Intelligence Research (FLAIR) was started within Fairchild Research.[31]In 1985 the lab was separated to form Schlumberger Palo Alto Research (SPAR).
Fairchild research developed the Clipper architecture, a 32-bit RISC-like computer architecture, in the 1980s, resulting in the shipping of the C100 chip in 1986. The technology was later sold to Intergraph, its main customer.
Schlumberger sold Fairchild to National Semiconductor in 1987 for $200 million.[32] The sale did not include Fairchild's Test Division, which designed and produced automated test equipment (ATE) for the semiconductor manufacturing industry, nor did it include Schlumberger Palo Alto Research.
In the early 1980s, Fairchild was one of several silicon valley tech companies involved in a lawsuit brought on by residents of San Jose, California. The case pertained to industrial solvent contamination of ground water and soil in San Jose's Los Paseos neighborhood. A settlement was reached and the area designated a superfund. Superfund site cleanup ended in 1998.[33]
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