Analog Semiconductor Spin-offs

Silicon Valley Analog Semiconductor Companies

Decades ago, when Don Hoefler made the phrase "Silicon Valley" famous, Fairchild Semiconductor was the center of the universe. This was still mostly true in the myopic view of analog semiconductor veterans, as well.

Some may argue.

And they would be right.

Absent from this view are the companies outside of Silicon Valley (and a few select others). I'll get to those, later.


Link to external presentation

Absent from today's landscape are ALL of these companies.

Fairchild Family Tree

One could argue that the seminal analog integrated circuit was the µA702, designed by Bob Widlar in 1963 (released in 1964) when he joined Fairchild. It wasn't good enough, in his opinion, so he designed the µA709 which was superior - both in performance and in sales revenue.

Frustrated with Fairchild management, he and Dave Talbert (an equally brilliant fab process engineer) joined Molectro. You could argue that Molectro - founded by James Nall from Fairchild - was a spin-off, but it was intended to create custom logic ICs. Talbert and Widlar thought their process would be good for analog.

Back then, National Semiconductor was a stodgy transistor company from back east. In 1967, Charlie Sporck, Fred Bialek, and Pierre Lamond - all from Fairchild - essentially re-founded National as a Silicon Valley company by acquiring (or merging with, and then relocating to) Molectro. That brought Widlar to National.

Signetics was founded in 1961, Intersil in 1967, and PMI in 1969 - all from Fairchild.

In The Beginning

Analog has been around forever; it's the way the natural world works. Analog circuits, like op amps, were made with vacuum tubes before integrated circuits or even transistors were invented.

The semiconductor transistor was invented at Bell Telephone Laboratories in 1947. The effort had begun years earlier with government funding during World War II. There was a wartime culture of cooperation and communication among research labs, universities, and military-industrial companies.

The invention was licensed to many companies in 1952. William Shockley, whose group at Bell Labs demonstrated the first transistor, left in 1955 and started his own company - Shockley Transistor.

In 1957, key members of his company left to start a new company - Fairchild Semiconductor.

Silicon Valley in 1963

By 1963, when Widlar was designing the µA702, Fairchild was attracting talented engineers but also losing them.

A few original Fairchild founders had already started new companies. This wave was significant because they were all emerging IC companies - they probably still made transistors and diodes - but the future of ICs was clear.

Ill-fated Rheem Semiconductor is an interesting story. They stole some IP from Fairchild on their way out. But it was for "mesa" transistors right about the time Jean Hoerni invented "planar" processing, which is what made ICs practical.

Amelco was renamed Teledyne Semiconductor rather quickly. Ultimately, they were acquired by Microchip Technology.

Schismogenesis

Schismogenesis literally means "creation of division". Gregory Bateson first used the term in a publication in 1935 to describe certain forms of social behavior between groups.

"Spin-off", in my opinion, has a neutral feeling and implies that the parent company agreed to release some part of its organization as a new company. The Fairchild spin-offs were generally not amicable and often involved lawsuits.

Typically, a group of engineers believed they had a great idea that needed funding but Fairchild management felt otherwise. That created a schism. Very quickly, that lead to the genesis of a new company founded by those engineers.

In "The Dawn of Everything" (2021), anthropologist David Graeber and archaeologist David Wengrow suggest that schismogenesis describes the way groups define themselves in opposition to other groups. "Fairchild management only gave stock options to senior executives, we will give stock options to every employee."

Fairchild, National, Intersil, and AMD were all broadbased chip companies, i.e., they made logic, memory, discrete transistors, and analog. Invariably, the schism was that analog went underfunded and the genesis was a group of pure analog companies.

Acquisitions

Starting on the top row:

• American Microsystems (1966) was renamed AMI Semiconductor (AMIS), then acquired by ON Semi in 2008.
• What was left of the original Fairchild was acquired by National Semiconductor in 1987, then spun-out several years later, then acquired by ON Semi in 2015.
• ON Semi, itself, was a spin-off of Motorola in 1999. What was left of Motorola Semiconductor was spun-off as Freescale in 2003.

The blue hats are the analog companies shown on the earlier slides. Several of the companies shown here are analog companies.

Second row:

• Signetics was acquired by Philips in 1975 and later became Philips Semiconductor.
• Philips spun-off the semiconductor group as NXP in 2006.
• In 2015, Freescale was acquired by (merged with?) NXP.

Third row:

• In 1965, Analog Devices was founded as a vacuum tube module company. In 1971, it created an IC company which it then acquired.
• Computer Labs (data acquisition boards, later data acquisition ICs) was acquired in 1978.
• Precision Monolithics was acquired in 1990.
• Hittite Microwave was acquired in 2014.
• Linear Technology was acquired in 2016.
• Maxim was acquired in 2020.

ADI has acquired many other companies along the way. This only highlights the significant analog acquisitions.

Fourth row:

• Texas Instruments was founded in 1951 from a reorganization of Geophysical Services, Inc.
• Unitrode was acquired in 1999.
• Burr-Brown was acquired in 2000.
• National Semiconductor was acquired in 2011.

Fifth row:

• Amelco was acquired in 1960, the first acquisition of the newly formed venture group called Teledyne. It was spun-off as TelCom Semiconductor in 1993 and acquired by Microchip Technology in 2000.
• Supertex was acquired in 2014.
• Micrel was acquired in 2015.

Sixth (bottom) row:

• The original Intersil was absorbed into GE then acquired by Harris in 1988, who then spun it off in 1999.
• Elantec was acquired by Intersil in 2002.
• Xicor was acquired by Intersil in 2004.
• Intersil was acquired by Renesas in 2017.

The companies aligned on the right of the chart currently exist, but none of their headquarters are in Silicon Valley. They do, by virtue of these acquisitions, have a presence here.

You may have noticed the prevalence of mega-mergers in the most recent decade. The dog-eat-dog (acquire or be acquired) nature of the industry today is not for me to explain. Personally, I think the demand for growth by shareholders and the fiduciary responsibility of boards has a lot to do with it. I think it is a bad thing.

The question for all of these acquisitions is whether or not they succeeded. Did the employees of the acquired company stay? Did the acquired product lines expand and continue to innovate?

Or did the schismogenesis - that self-definition based on differences - cause an internal culture clash, ultimately causing the acquiring company to crush them?

Was the long-term effect simply the legacy revenue of the acquired product lines? (Obviously, I believe that is true in most cases.)