● ● Future of Digital Economy COVER STORY • 7 Milestones in Photo: ©Bettmann/CORBIS Microelectronics By George SCALISE

Nearly 70 years ago, Joseph Schum- between different types of calculating peter, a European-born economics pro- operations required manually moving fessor at Harvard University, published numerous cables and . Despite his landmark work, “Capitalism, its bulk and unwieldy operations, ENIAC Socialism, and Democracy.” In this mon- was a very efficient : it could do umental work, Professor Schumpeter set in about 30 seconds a complex calcula- forth his now-famous concept of “cre- tion that a skilled person with a desk cal- ative destruction.” culator took 20 hours to complete. ENIAC (Electrical Numerical Integrator and Creative Destruction – the Real A Major Milestone – the Invention Calculator), 1946 Basis of Competition of the in 1947 in place of vacuum tubes, the aerospace Simply put, Schumpeter argued that ENIAC demonstrated not only the industry was an early driver of demand for real competition consists of not merely potential of electronic computing but lightweight, highly durable, low-power offering a commodity product at a lower also the need for a technological break- systems built around the transistor. price than a competitor. The real basis through that would reduce the size and Even the transistor rather quickly ran of competition is radical innovation power requirements while increasing the up against scaling limits. With a rapidly based on new technology, new methods computational capabilities of future com- growing demand for more complex elec- of production, and new organizational puters. That breakthrough came the fol- tronic circuitry, the search was on for a structures to offer new products that lowing year, in 1947, with the invention new type of device that could further have such compelling advantages that the of the transistor by William Shockley, shrink the size of individual new products literally kill off older prod- John Bardeen, and Walter Brattain at while enhancing the performance and ucts in a process of creative destruction. Bell Laboratories in New Jersey. This reducing the cost of electronic systems. Nowhere has this process been more invention – revealed 60 years ago last dramatically demonstrated than in the December – signaled the onset of a new Another Milestone in microelectronics industry. Although era and the birth of the microelectronics Microelectronics – the First Schumpeter lived to see the dawning of industry. The three scientists won the Integrated Circuits the digital age, it is doubtful that even 1956 Nobel Prize in Physics for their he foresaw the extent of the creative invention of the transistor. The next major breakthrough came destruction that began in the late 1940s. The process of creative destruction was 50 years ago, in 1958, when a young sci- The basic building block of electronic brutally effective: not one of the US com- entist at Texas Instruments, Jack Kilby, systems through the first four decades of panies that had dominated the manufac- invented the – an the 20th century was the vacuum tube. ture of vacuum tubes made a successful ungainly-looking device that contained Invented in the late 1800s, the vacuum transition to competition in the emerging all of the required elements of a circuit tube was itself a great breakthrough that era of solid-state microelectronics. on a single piece of semiconducting made possible radical new inventions The transistor was a huge breakthrough, material, in this case germanium. including radio and broadcast- with enormous advantages over the vacu- Kilby’s invention was followed a year ing, telephone networks, radar, and count- um tube – especially in size and power later, in 1959, by the invention of the pla- less other electronic devices. In 1946 the consumption. The “portable” radio of the nar integrated circuit by Robert Noyce, world’s first electronic digital computer pre-transistor era was approximately the then a young engineer with Fairchild (named ENIAC for Electrical Numerical size of a microwave oven and generated . Noyce’s contribution was Integrator And Calculator) was unveiled at enough heat to warm a small room. the creation of a system of interconnected the University of Pennsylvania. Vacuum tubes were also rather fragile and transistors on a single, monolithic silicon ENIAC was both a marvel and a mon- frequently burned out. Solid-state circuit- chip. Noyce’s invention provided the ster. The computer weighed more than ry was much more rugged and well suited breakthrough enabling seemingly unlimit- 30 tons, occupied 1,800 square feet of to new applications that required small ed scalability. Today, the most advanced floor space, and consumed more than size, great endurance, and the ability to chips contain two billion transistors on a 150 kilowatts to power more than 17,000 operate on battery power. While the tran- sliver of silicon about the size of a dime. vacuum tubes, 10,000 , and sistor radio is widely recognized as the first Kilby was awarded the 2000 Nobel 6,000 manual switches. Switching important product employing transistors Prize in Physics for his invention.

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The first integrated circuits (ICs) Nobel prizes are not awarded posthu- Photos: Intel mously, and Noyce had died suddenly in 1990. At the awards ceremony, Kilby graciously stated that he was accepting the prize not only for his own contribu- tions but also in recognition of Noyce as the co-inventor of the integrated circuit.

Smaller, Faster, Cheaper – the Mantra of the Microelectronics Industry Bob Noyce’s IC, 1959 Jack Kilby’s IC, 1958 In the nearly half century since the cameras. In another example of creative Moore’s Law first working silicon integrated circuit destruction at work, the instant film cam- was unveiled, “smaller, faster, cheaper” era has virtually disappeared from the In 1965, when the microchip industry has become the mantra of the microelec- market. While there are a handful of was still in its early infancy, another bril- tronics industry. The pervasiveness of manufacturers still producing typewriters, liant young engineer at Fairchild integrated circuits has grown exponen- these remarkable machines first invented Semiconductor, Gordon Moore, made tially as microchips have enabled an in the 19th century have almost disap- an observation about the pace of techno- incredible variety of electronic devices peared from the modern office, replaced logical progress in integrated circuits. that existed only in science fiction half a by word processors and laser printers Working from only two data points, century ago. Today it is hard to imagine filled with advanced electronic circuitry. Moore observed that the number of a world without personal , cell This year the worldwide semiconduc- transistors on a square inch of silicon phones, the Internet, email, ecommerce, tor industry will produce nearly 900 had doubled every year since the inven- digital cameras, and a host of other million transistors for every man, tion of the integrated circuit. Moore, products made possible by advances in woman, and child on earth. who later went on to co-found Intel microchip technology. Corp. with his colleague Robert Noyce, The worldwide semiconductor industry Consumers Now Drive Industry predicted that this rate of progress could is huge – worldwide sales of microchips Growth continue for at least another 10 years. will be more than $266 billion in 2008 The observation, of course, has become and will surpass $324 billion in 2011. Industry growth is now being driven known as “Moore’s Law” and it has Industry revenues, however, tell only a principally by consumers – approximate- been the benchmark of industry progress small part of the story of the growing ly 55% of semiconductor industry rev- for more than four decades. While the demand for and the ever- enues are from circuits that go into pace of technological advance has slowed more important role chips play in our products purchased by individual con- slightly in recent years – chip density world. Integrated circuits are unique in sumers. This is a major change from now doubles approximately every 18 that each year these electronic marvels just a few years ago when corporate months – observers who predicted the become faster and more powerful, deliver- information technology was the major imminent end of Moore’s Law have ing increased performance and function- demand driver for semiconductors. been consistently proven wrong. ality in end products – for less money! Over the past 10 to 15 years, major eco-

The personal computer is an excellent nomic and political changes throughout Photo: Agere example of how advances in semicon- the world have brought literally hundreds ductor technology have dramatically of millions of new consumers into the reduced the cost of electronic products marketplace for electronic products. while delivering enormous improve- Enormous new markets in China, India, ments in performance and functionality. Eastern Europe, Southeast Asia, and Latin The typical desktop computer of 2007 America have opened up. China alone sold for approximately $630 versus now has a middle class of more than 300 $1,833 for a typical desktop system in million people – roughly equivalent to the 1997 – barely more than one-third the entire population of the United States. cost of a decade ago. The typical PC of To put this rapid expansion of the 2007, however, was at least 100 times market for consumer electronic products more powerful and included features into perspective, consider this: China such as digital video recorders, network added nearly 7.5 million new mobile interface cards, enhanced graphics, and telephone subscribers in May 2008. other features not available a decade ago. AT&T, the largest American cellular In 2005, for the first time ever, sales of phone service provider, added nine mil- digital cameras surpassed sales of film lion new subscribers in all of 2007! The first transistor, 1947

26 JAPAN SPOTLIGHT • September / October 2008 COVER STORY • 7 Innovation allows us to do more with less Increased functionality and a 66% price drop in only 10 years! Photo: Intel Spec 1997 Q4 2007 (GT5622) both basic research, which has a long- Processor 2nd Gen 32-bit Intel E2160 term payback, and research and develop- Raw Power (Normalized) 1 80-120 ment, which leads directly to commer-

Clock Rate 75MHz 1.8 GHz cialization of new products and has a

Memory 9.2MB 3GB near-term payback. A question that

Disk Storage 0.74GB 400GB is frequently posed to industry leaders is: “Why do we need chips Modem No 56K that are faster and smaller? How Network Interface Card (NIC) No Ethernet much smaller can you make a cell Graphics Add-In Integrated Chipset phone or a personal computer?” CD ROM 1X Multi-Format DVD Burner The answer of course is that CD-RW/DVD No None there will be a never-ending drive Media Reader None 15-in-1 to increase the functionality, per- Flash Drive formance, and ease-of-use of elec- Removable Storage Floppy Disk (1.5MB) 4GB tronic products by increasing the Price $1,833 $630 density of microchips. The first cell Source : Gateway January 2008 phones were large by today’s standards. The early units had limited functionali- The Nanoelectronics Era ty, relatively short battery life, and not much storage capacity – and they were Moore’s Law original graph, 1965 Moore’s Law ultimately must defer to more expensive than the typical smart the laws of physics and there is a broad phone of today. Smaller, faster, cheaper more productive through the use of vari- consensus within the industry that the microelectronic components account for able-speed electric motors. In 1978, com- scaling limits of current semiconductor the difference. puters executed 1,400 instructions per technology (known as CMOS for comple- The PC is another beneficiary second/watt. That number has increased mentary metal-oxide semiconductor) will of technological progress in semiconduc- to 40 million instructions per second/watt be reached within the next 10 to 15 years. tors. For well under $1,000 a consumer this year – an improvement of nearly 3 Progress in information technology can buy a lightweight, powerful com- million percent! Semiconductor technol- will not come to a screeching halt once puter with a high-definition, 15-inch ogy is also playing a huge role in the cre- the limits of conventional technology display with performance that exceeds ation of more efficient and more effec- have been reached. Scientists and engi- that of a supercomputer of a decade ago. tive solar panels, which hold the promise neers around the world are engaged in The reality is that creative engineers of providing a new and sustainable basic research to develop new technolo- and scientists will always find new ways source of energy. gies for nano-scale devices that will to employ the expanding capabilities of The pioneers of the microelectronics enable continued progress well into the advanced semiconductors. As noted ear- industry and the engineers and scientists 21st century. The challenges are not lier, electronic devices that were the stuff who are at work around the world today inconsequential. Creating new devices of science fiction only a few years ago to enable the next wave of creative with features smaller than one nanome- are now commodity products affordable destruction share one common quality: ter – one one-billionth of a meter – will even to those in emerging economies. they are incurable optimists who believe require the invention of a new , that every challenge and every obstacle to use of new materials, and implementa- Doing More, Using Less continued progress also brings new oppor- tion of new assembly methods. tunities. They reject the notion that Throughout history, there has typically One of the greatest challenges facing future generations will have to lower their been a 15-year lag between the begin- the entire world today is meeting the expectations of a better quality of life. ning of research on any radical new tech- growing demand for energy while mini- For more than 60 years, progress in nology and the commercialization of mizing the environmental impact of microelectronics has enabled people products based on the new technology. increased energy production and use. everywhere to become more productive, By that metric, the true nanoelectronics The microelectronics industry will play to enjoy a higher standard of living, and era is likely to begin around 2020. a major role in meeting this challenge by to believe that their children can expect Meanwhile the worldwide industry enabling people everywhere to do more an even brighter future. will continue to drive CMOS technolo- with less energy. Advanced semiconduc- There is little doubt that our best days gy to its ultimate limits. tors are already achieving dramatic energy are yet to come! savings by reducing energy consumption Challenges and Opportunities of the world’s largest data centers, George Scalise is President of the enabling more fuel-efficient automobiles, Semiconductor Industry Association (SIA), a Continued progress in semiconductor extending the battery life of portable elec- leading voice for the US semiconductor technology will require a major ongoing tronic devices, saving energy in home industry that has represented American commitment of resources to support appliances, and helping factories become semiconductor companies since 1977.

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