Fairchild Semiconductor

» see fairchildsemi.com as it lived, on the wayback machine

~ the obit ~

Fairchild Semiconductor opened on 1 October 1957 in Mountain View as a division of Fairchild Camera and Instrument, a New York company that made aerial cameras. It sold its first product, a silicon transistor, to IBM for a bomber navigation computer. Two years later Jean Hoerni worked out how to build a transistor with its junctions sealed under a layer of grown oxide instead of exposed to the air, and that planar process is the one every chip since has been built on. Robert Noyce used it that same year to put several components on one piece of silicon and wire them together on the surface.

It grew from twelve people to twelve thousand and to about 130 million dollars a year, and then it started losing its own staff faster than it could replace them. Schlumberger bought the whole of Fairchild Camera and Instrument in 1979 for 425 million dollars and had no idea what to do with a chip business. National Semiconductor picked it up in 1987 for 200 million, less than half what the previous owner had paid, then spun it back out to its own management in 1997 for 550 million. The independent company that came out the other end moved to South Portland, Maine, and went looking for volume in power discretes. It bought Samsung's power device division in 1999 and Intersil's discrete power business in 2001, which made it the second largest supplier of power MOSFETs in the world.

I got Fairchild the way most engineers get it, as a chapter rather than as a supplier. The traitorous eight and the planar process make a story with a shape, and it was finished decades before I ever sat down at a computer. The company still trading under the name while I was working sold power switches out of South Portland, and it had not been a Californian company for twenty years by then.

~ the rap sheet ~

~ the eight who walked out ~

William Shockley shared the Nobel Prize for the transistor and then set up a lab in Mountain View in 1956 and hired a group of very good young people into it. He was a bad manager in a specific and documented way: he posted everyone's salary on the wall and he floated the idea of putting his own staff through lie detector tests. On 18 September 1957 eight of them resigned together. Julius Blank, Victor Grinich, Jean Hoerni, Eugene Kleiner, Jay Last, Gordon Moore, Robert Noyce and Sheldon Roberts had no money and no company, and Arthur Rock found them Sherman Fairchild, who put up 1.38 million dollars against an option to buy them all out later.

Fairchild exercised that option in 1959, two years in, for about three million dollars. The eight who had built the thing were now employees of a camera company in New York.

~ the fairchildren ~

The leaving started almost immediately. Four engineers walked out in 1961 and started Signetics, the first company founded purely to make integrated circuits. Jean Hoerni and Jay Last went to Amelco, and the firm Eugene Kleiner later co-founded is Kleiner Perkins. Charlie Sporck, running the semiconductor division, left in 1967 to take over National Semiconductor and took a pay cut to do it. Noyce and Moore resigned in 1968 to start Intel, and Jerry Sanders followed them out the door in 1969 to start AMD.

The Computer History Museum traces dozens of firms to Fairchild alumni, and the count runs into the hundreds if you follow the later generations. By the middle of the 1970s Fairchild was being beaten in its own market by companies staffed with its own former employees, which is the reason it was for sale at all. A camera company bought the future of electronics for three million dollars and then watched it walk across town in pieces.

~ the last bid ~

ON Semiconductor agreed to buy Fairchild in November 2015 at 20 dollars a share, valuing it at about 2.4 billion. In December a consortium of China Resources Microelectronics and Hua Capital came in unsolicited at 21.70 a share, roughly 2.46 billion, which was straightforwardly more money for every shareholder. Fairchild's board rejected it in February 2016 and the published reason was regulatory. A Chinese buyer of an American chip company had to clear the Committee on Foreign Investment in the United States, and the consortium's reverse break fee if CFIUS blocked the deal was 108 million dollars, well below what ON Semiconductor had committed to. The board decided the lower bid was worth more because it would actually close.

It closed on 19 September 2016. The Fairchild name came off the products over the following couple of years and ON Semiconductor kept the fabs and the power catalog. Today fairchildsemi.com returns a 301 to onsemi.com with tracking parameters attached that label it a domain redirect campaign, which means somebody in marketing is still counting how many people type the old address.

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