Hooking Up (6 page)
Noyce used to go into a slow burn that year, 1968, when the newspapers, the magazines, and the television networks got on the subject of
the youth. The youth
was a favorite topic in 1968. Riots broke out on the campuses as the antiwar movement reached its peak following North Vietnam’s Tet offensive. Black youths rioted in the cities. The Yippies, supposedly a coalition of hippies and campus activists, managed to sabotage
the Democratic National Convention by setting off some highly televised street riots. The press seemed to enjoy presenting these youths as the avant-garde who were sweeping aside the politics and morals of the past and shaping America’s future. The French writer Jean-François Revel toured American campuses and called the radical youth
homo novus,
“the New Man,” as if they were the latest, most advanced product of human evolution itself, after the manner of the superchildren in Arthur C. Clarke’s
Childhood’s End.
the youth. The youth
was a favorite topic in 1968. Riots broke out on the campuses as the antiwar movement reached its peak following North Vietnam’s Tet offensive. Black youths rioted in the cities. The Yippies, supposedly a coalition of hippies and campus activists, managed to sabotage
the Democratic National Convention by setting off some highly televised street riots. The press seemed to enjoy presenting these youths as the avant-garde who were sweeping aside the politics and morals of the past and shaping America’s future. The French writer Jean-François Revel toured American campuses and called the radical youth
homo novus,
“the New Man,” as if they were the latest, most advanced product of human evolution itself, after the manner of the superchildren in Arthur C. Clarke’s
Childhood’s End.
Homo novus?
As Noyce saw it, these so-called radical youth movements were shot through with a yearning for a preindustrial Arcadia. They wanted, or thought they wanted, to return to the earth and live on organic vegetables and play folk songs from the sixteenth and seventeenth centuries. They were antitechnology. They looked upon science as an instrument monopolized by the military-industrial complex. They used this phrase, “the military-industrial complex,” all the time. If industry or the military underwrote scientific research in the universities—and they underwrote a great deal of it—then that research was evil. The universities were to be pure and above exploitation, except, of course, by ideologues of the Left. The
homo novus
had set up a chain of logic that went as follows: since science equals the military-industrial complex, and the military-industrial complex equals capitalism, and capitalism equals fascism, therefore science equals fascism. And therefore these much-vaunted radical youths, these shapers of the future, attacked the forward positions of American technology, including the space program and the very idea of the computer. And therefore these creators of the future were what? They were Luddites. They wanted to destroy the new machines. They were the reactionaries of the new age. They were an avant-garde to the rear. They wanted to call off the future. They were stillborn, ossified, prematurely senile.
As Noyce saw it, these so-called radical youth movements were shot through with a yearning for a preindustrial Arcadia. They wanted, or thought they wanted, to return to the earth and live on organic vegetables and play folk songs from the sixteenth and seventeenth centuries. They were antitechnology. They looked upon science as an instrument monopolized by the military-industrial complex. They used this phrase, “the military-industrial complex,” all the time. If industry or the military underwrote scientific research in the universities—and they underwrote a great deal of it—then that research was evil. The universities were to be pure and above exploitation, except, of course, by ideologues of the Left. The
homo novus
had set up a chain of logic that went as follows: since science equals the military-industrial complex, and the military-industrial complex equals capitalism, and capitalism equals fascism, therefore science equals fascism. And therefore these much-vaunted radical youths, these shapers of the future, attacked the forward positions of American technology, including the space program and the very idea of the computer. And therefore these creators of the future were what? They were Luddites. They wanted to destroy the new machines. They were the reactionaries of the new age. They were an avant-garde to the rear. They wanted to call off the future. They were stillborn, ossified, prematurely senile.
If you wanted to talk about the creators of the future—well, here they were! Here in the Silicon Valley! Just before Apollo 8 circled the moon, Bob Noyce turned forty-one. By age forty-one he had become such a good skier, people were urging him to enter competitions. When his daughter Penny was almost fourteen, he asked her what she
wanted for her birthday, and she said she wanted to drop from an airplane by parachute. Noyce managed to convince her to settle for glider lessons instead. Then, because it made him restless to just stand around an airfield and watch her soar up above, he took flying lessons, bought an airplane, and began flying the family up through the mountain passes to Aspen, Colorado, for skiing weekends. He had the same lean, powerful build as he had had twenty years before, when he was on the swimming team at Grinnell College. He had the same thick dark brown hair and the same hairline. It looked as if every hair in his head were nailed in. He looked as if he could walk out the door any time he wanted to and win another Midwest Conference diving championship. And he was one of the
oldest
CEOs in the semiconductor business! He was the Edison of the bunch! He was the
father
of the Silicon Valley!
wanted for her birthday, and she said she wanted to drop from an airplane by parachute. Noyce managed to convince her to settle for glider lessons instead. Then, because it made him restless to just stand around an airfield and watch her soar up above, he took flying lessons, bought an airplane, and began flying the family up through the mountain passes to Aspen, Colorado, for skiing weekends. He had the same lean, powerful build as he had had twenty years before, when he was on the swimming team at Grinnell College. He had the same thick dark brown hair and the same hairline. It looked as if every hair in his head were nailed in. He looked as if he could walk out the door any time he wanted to and win another Midwest Conference diving championship. And he was one of the
oldest
CEOs in the semiconductor business! He was the Edison of the bunch! He was the
father
of the Silicon Valley!
The rest of the hotshots were younger. It was a business dominated by people in their twenties and thirties. In the Silicon Valley there was a phenomenon known as burnout. After five or ten years of obsessive racing for the semiconductor high stakes, five or ten years of lab work, work lunches, workaholic drinks at the Wagon Wheel, and workbattering of the wife and children, an engineer would reach his middle thirties and wake up one day—and he was finished. The game was over. It was called burnout, suggesting mental and physical exhaustion brought about by overwork. But Noyce was convinced it was something else entirely. It was …
age,
or age and status. In the semiconductor business, research engineering was like pitching in baseball; it was 60 percent of the game. Semiconductor research was one of those highly mathematical sciences, such as microbiology, in which, for reasons one could only guess at, the great flashes, the critical moments of inspiration, came mainly to those who were young, often to men in their twenties. The thirty-five-year-old burnouts weren’t suffering from exhaustion, as Noyce saw it. They were being overwhelmed, outperformed, by the younger talent coming up behind them. It wasn’t the central nervous system that was collapsing, it was the ego.
age,
or age and status. In the semiconductor business, research engineering was like pitching in baseball; it was 60 percent of the game. Semiconductor research was one of those highly mathematical sciences, such as microbiology, in which, for reasons one could only guess at, the great flashes, the critical moments of inspiration, came mainly to those who were young, often to men in their twenties. The thirty-five-year-old burnouts weren’t suffering from exhaustion, as Noyce saw it. They were being overwhelmed, outperformed, by the younger talent coming up behind them. It wasn’t the central nervous system that was collapsing, it was the ego.
Now here you saw youth in the vanguard, on the leading edge! Here
you saw the youths who were, in fact, shaping the future! Here you saw, if you insisted on the term, the
homo novus
!
you saw the youths who were, in fact, shaping the future! Here you saw, if you insisted on the term, the
homo novus
!
But why insist? For they were also of the same stripe as Josiah Grinnell, who had founded Grinnell., Iowa, at the age of thirty-three.
It was in 1968 that Noyce pulled off the redefection of all redefections. Fairchild Semiconductor had generated tremendous profits for the parent company back East. It now appeared to Noyce that John Carter and Sherman Fairchild had been diverting too much of that money into new start-up ventures outside the semiconductor field. As a matter of fact, Noyce disliked many things “back East.” He disliked the periodic trips to New York, for which he dressed in gray suits, white shirts, and neckties and reported to the royal corporate court and wasted days trying to bring them up-to-date on what was happening in California. Fairchild was rather enlightened, for an Eastern corporation, but the truth was, there was no one back East who understood how to run a corporation in the United States in the second half of the twentieth century. Back East they had never progressed beyond the year 1940. Consequently, they were still hobbled by all the primitive stupidities of bureaucratism and labor-management battles. They didn’t have the foggiest comprehension of the Silicon Valley idea of a corporate community. The brightest young businessmen in the East were trained—most notably at Harvard Business School—to be little Machiavellian princes. Greed and strategy were all that mattered. They were trained for failure.
Noyce and Gordon Moore, two of the three original eight Shockley elves still at Fairchild, decided to form their own company. They went to Arthur Rock, who had helped provide the start-up money for Fairchild Semiconductor when he was at Hayden Stone. Now Rock had his own venture capital operation. Noyce took great pleasure in going through none of the steps in corporate formation that the business schools talked about. He and Moore didn’t even write up a proposal.
They merely told Rock what they wanted to do and put up $500,000 of their own money, $250,000 each. That seemed to impress Rock more than anything they could possibly have written down, and he rounded up $2.5 million of the start-up money. A few months later another $300,000 came, this time from Grinnell College. Noyce had been on the college’s board of trustees since 1962, and a board member had asked him to give the college a chance to invest, should the day come when he started his own company. So Grinnell College became one of the gamblers betting on Noyce and Intet—the pseudo-tech engineerologism Noyce and Moore dreamed up as the corporate name. Josiah Grinnell would have loved it.
They merely told Rock what they wanted to do and put up $500,000 of their own money, $250,000 each. That seemed to impress Rock more than anything they could possibly have written down, and he rounded up $2.5 million of the start-up money. A few months later another $300,000 came, this time from Grinnell College. Noyce had been on the college’s board of trustees since 1962, and a board member had asked him to give the college a chance to invest, should the day come when he started his own company. So Grinnell College became one of the gamblers betting on Noyce and Intet—the pseudo-tech engineerologism Noyce and Moore dreamed up as the corporate name. Josiah Grinnell would have loved it.
The defection of Noyce and Moore from Fairchild was an earthquake even within an industry jaded by the very subject of defections. In the Silicon Valley everybody had looked upon Fairchild as Noyce’s company. He was the magnet that held the place together. With Noyce gone, it was obvious that the entire workforce would be up for grabs. As one wag put it, “People were practically driving trucks over to Fairchild Semiconductor and loading up with employees.” Fairchild responded by pulling off one of the grossest raids in corporate history. One day the troops who were left at Fairchild looked across their partitions and saw a platoon of young men with terrific suntans moving into the executive office cubicles. They would always remember what terrific suntans they had. They were C. Lester Hogan, chief executive officer of the Motorola semiconductor division in Phoenix, and his top echelon of engineers and administrators. Or, rather, C. Lester Hogan of Motorola until yesterday. Fairchild had hired the whole bunch away from Motorola and installed them in place of Noyce & Co. like a matched set. There was plenty of sunshine in the Santa Clara Valley, but nobody here had suntans like this bunch from Phoenix. Fairchild had lured the leader of the young sun-gods out of the Arizona desert in the most direct way imaginable. He had offered him an absolute fortune in money and stock. Hogan received so much, the crowd at the Wagon Wheel said, that henceforth wealth in the Silicon Valley would be measured in units called hogans.
Noyce and Moore, meanwhile, started Intel up in a tilt-up concrete building that Jean Hoerni and his group had built but no longer used, in Santa Clara, which was near Mountain View. Once again there was an echo of Shockley. They opened up shop with a dozen bright young electrical engineers, plus a few clerical and maintenance people, and bet everything on research and product development. Noyce and Moore, like Shockley, put on the white coats and worked at the laboratory tables. They would not be competing with Fairchild or anyone else in the already established semiconductor markets. They had decided to move into the most backward area of computer technology, which was data storage, or “memory.” A computer’s memory was stored in ceramic ringlets known as cores. Each ringlet contained one “bit” of information, a “yes” or a “no,” in the logic of the binary system of mathematics that computers employ. Within two years Noyce and Moore had developed the 1103 memory chip, a chip of silicon and polysilicon the size of two letters in a line of type. Each chip contained four thousand transistors, did the work of a thousand ceramic ringlets, and did it faster. The production line still consisted of rows of women sitting at tables as in the old shed-and-rafter days, but the work bays now looked like something out of an intergalactic adventure movie. The women engraved the circuits on the silicon photographically, wearing antiseptic Mars Voyage suits, headgear, and gloves because a single speck of dust could ruin one of the miniature circuits. The circuits were so small that “miniature” no longer sounded small enough. The new word was “microminiature.” Everything now took place in an air-conditioned ice cube of vinyl tiles, stainless steel, fluorescent lighting, and backlit plastic.
The 1103 memory chip opened up such a lucrative field that other companies, including Fairchild, fought desperately just to occupy the number-two position, filling the orders Intel couldn’t take care of. At the end of Intel’s first year in business, which had been devoted almost exclusively to research, sales totaled less than three thousand dollars and the workforce numbered forty-two. In 1972, thanks largely to the 1103 chip, sales were $23.4 million and the workforce numbered
1,002. In the next year sales almost tripled, to $66 million, and the workforce increased two and a half times, to 2,528.
1,002. In the next year sales almost tripled, to $66 million, and the workforce increased two and a half times, to 2,528.
So Noyce had the chance to run a new company from start-up to full production precisely the way he thought Shockley should have run his in Palo Alto back in the late 1950s. From the beginning Noyce gave all the engineers and most of the office workers stock options. He had learned at Fairchild that in a business so dependent upon research, stock options were a more powerful incentive than profit sharing. People sharing profits naturally wanted to concentrate on products that were already profitable rather than plunge into avant-garde research that would not pay off in the short run even if it was successful. But people with stock options lived for research breakthroughs. The news would send a semiconductor company’s stock up immediately, regardless of profits.
Noyce’s idea was that every employee should feel that he could go as far and as fast in this industry as his talent would take him. He didn’t want any employee to look at the structure of Intel and see a complex set of hurdles. It went without saying that there would be no social hierarchy at Intel, no executive suites, no pinstripe set, no reserved parking places or other symbols of the hierarchy. But Noyce wanted to go further. He had never liked the business of the office cubicles at Fairchild. As miserable as they were, the mere possession of one symbolized superior rank. At Intel executives would not be walled off in offices. Everybody would be in one big room. There would be nothing but low partitions to separate Noyce or anyone else from the lowliest stock boys trundling in the accordion printout paper. The whole place became like a shed. When they first moved into the building, Noyce worked at an old, scratched, secondhand metal desk. As the company expanded, Noyce kept the same desk, and new stenographers, just hired, were given desks that were not only newer but bigger and better than his. Everybody noticed the old beat-up desk, since there was nothing to keep anybody from looking at every inch of Noyce’s office space. Noyce enjoyed this subversion of the Eastern corporate protocol of small metal desks for underlings and large wooden desks for overlords.
At Intel, Noyce decided to eliminate the notion of levels of management altogether. He and Moore ran the show; that much was clear. But below them there were only the strategic business segments, as they called them. They were comparable to the major departments in an orthodox corporation, but they had far more autonomy. Each was run like a separate corporation. Middle managers at Intel had more responsibility than most vice-presidents back East. They were also much younger and got lower-back pain and migraines earlier. At Intel, if the marketing division had to make a major decision that would affect the engineering division, the problem was not routed up a hierarchy to a layer of executives who oversaw both departments. Instead, “councils,” made up of people already working on the line in the divisions that were affected, would meet and work it out themselves. The councils moved horizontally, from problem to problem. They had no vested power. They were not governing bodies but coordinating councils.
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