"The Soviet launch of Sputnik on Oct. 4, 1957, prodded the United States to modernize its missile and space program. The newfangled silicon chips were considered vital - albeit costly - components... but NASA and the Defense Department bought so many 'that the price dropped from $1,000 a chip to between $20 and $30.'"
In Break Through we argue that the military's virtual creation of Silicon Valley is a model for investments the military should today make into clean energy. Right on cue, the Sunday San Francisco Chronicle offered up this history:
The early chip industry, like the two waves of innovation before, initially depended on military expenditures, Paul Ceruzzi, a curator at the Smithsonian Institution, writes in his book "A History of Modern Computing."
Only this time, it was the Cold War that opened the government's checkbook.
The Soviet launch of Sputnik on Oct. 4, 1957, prodded the United States to modernize its missile and space program. The newfangled silicon chips were considered vital - albeit costly - components, and Ceruzzi writes that NASA and the Defense Department bought so many "that the price dropped from $1,000 a chip to between $20 and $30."
Falling chip prices fueled development of new electronics for corporate customers and eventually individual consumers. Reliance on military purchases lessened, though defense dollars remained important in spurring research. Thus, when Larry Page and Sergey Brin later dreamed up Google, a defense research grant helped support their work. And when Stanford computer scientists won a robotic car race in 2005, the prize came from the Defense Department.
By the 1970s, therefore, Silicon Valley was poised to capitalize on new civilian technologies like PCs, as exemplified by Apple Computer.
