Traitorous eight
The traitorous eight was a group of eight employees who left Shockley Semiconductor Laboratory in 1957 to found Fairchild Semiconductor. William Shockley had in 1956 recruited a group of young Ph.D. graduates with the goal to develop and produce new semiconductor devices. While Shockley had received a Nobel Prize in Physics and was an experienced researcher and teacher, his management of the group was authoritarian and unpopular. This was accentuated by Shockley's research focus not proving fruitful. After the demand for Shockley to be replaced was rebuffed, the eight left to form their own company.
Shockley described their leaving as a "betrayal." The eight who left Shockley Semiconductor were Julius Blank, Victor Grinich, Jean Hoerni, Eugene Kleiner, Jay Last, Gordon Moore, Robert Noyce, and Sheldon Roberts. In August 1957, they reached an agreement with Sherman Fairchild, and on September 18, 1957, they formed Fairchild Semiconductor. The newly founded Fairchild Semiconductor soon grew into a leader in the semiconductor industry. In 1960, it became an incubator of Silicon Valley and was directly or indirectly involved in the creation of dozens of corporations, including Intel and AMD. These many spin-off companies came to be known as "Fairchildren."
Initiation
In the winter of 1954–1955, William Shockley, an inventor of the transistor and a visiting professor at Stanford University, decided to establish his own mass production of advanced transistors and Shockley diodes. He found a sponsor in Raytheon, but Raytheon discontinued the project after a month. In August 1955, Shockley turned for advice to the financier Arnold Beckman, the owner of Beckman Instruments. Shockley needed one million dollars. Beckman knew that Shockley had no chance in the business, but believed that Shockley's new inventions would be beneficial for his own company and did not want to give them to his competitors. Accordingly, Beckman agreed to create and fund a laboratory under the condition that its discoveries should be brought to mass production within two years.The new department of Beckman Instruments took the name Shockley Semi-Conductor Laboratories. During 1955, Beckman and Shockley signed the deal, bought licenses on all necessary patents for $25,000, and selected the location in Mountain View, near Palo Alto, California. Though Shockley did recruit four PhD physicists, William W. Happ George Smoot Horsley and Leopoldo B. Valdes, and Richard Victor Jones, the location provided limited enticement for new employees. The vast majority of semiconductor-related companies and professionals were based on the East Coast, so Shockley posted ads in The New York Times and the New York Herald Tribune. Early respondents included Sheldon Roberts of Dow Chemical, Robert Noyce of Philco, and Jay Last, a former intern of Beckman Instruments. The newspaper campaign brought some three hundred responses, and fifteen people, including Gordon Moore and David Allison, Shockley himself recruited at a meeting of the American Physical Society.
Selection continued throughout 1956. Shockley was a proponent of social technologies and asked each candidate to pass a psychological test, followed by an interview.
Blank, Last, Moore, Noyce, and Roberts started working in April–May, and Kleiner, Grinich, and Hoerni came during the summer. By September 1956, the lab had 32 employees, including Shockley. Each successful candidate had to negotiate his salary with Shockley. Kleiner, Noyce, and Roberts settled for $1,000 per month; the less-experienced Last got $675. Hoerni did not bother about his payment. Shockley set his own salary at $2,500 and made all salaries accessible to all employees.
The members of the future traitorous eight were aged between 26 and 33, and six of them held PhDs. Hoerni was an experienced scientist and gifted manager, and, according to Bo Lojek, matched Shockley in intellect. Only Noyce was involved in semiconductor research, and only Grinich had experience in electronics.
Research strategy
Throughout 1956, most members of the lab were assembling and tuning the equipment, and "pure scientists" Hoerni and Noyce carried out individual applied research. Shockley refused to hire technical staff, believing that his scientists should be able to handle all technological processes. After resettlement, he focused on fine-tuning Shockley diodes for mass production, and five employees, led by Noyce, continued the work on a field effect transistor for Beckman Instruments. Shockley refused to work on bipolar transistors, which later was proven a strategic mistake because the work on Shockley diodes took so much effort that the produced devices were commercial failures.According to Noyce and Moore, as well as David Brock and Joel Shurkin, the shift from bipolar transistors to Shockley diodes was unexpected. Shockley initially planned to work on the mass production of diffusion bipolar transistors, but then set up a "secret project" on Shockley diodes, and in 1957 stopped all works on bipolar transistors. The reasons for this turn are unknown. According to Beckman's biographer, Shockley regarded his diode as an interesting scientific problem and chose it neglecting Beckman's commercial interests.
Bo Lojek, based on the archives of Shockley, believes that Shockley Labs never worked on bipolar transistors; that Shockley diodes were Shockley and Beckman's original target, for which Beckman Instruments received military R&D contracts; and that Shockley diodes could have found widespread use in telephony if Shockley had improved their reliability.
Frictions
Historians and colleagues generally agree that Shockley was a poor manager and businessman. From early childhood he was prone to outbursts of unprovoked aggression, which were suppressed only due to the internal discipline of his past working environment. He also tended to see rivals, even in his own subordinates.On November 1, 1956, it was announced that the 1956 Nobel Prize in Physics would be awarded to Shockley, Bardeen, and Brattain. The related public events of November–December overtired Shockley and took him away from the lab at a time when it had several management problems. Despite the festivities, the atmosphere in the lab was unhealthy.
Although Shockley was never diagnosed by psychiatrists, historians characterized Shockley's state of mind in 1956–1957 as paranoia or autism. All phone calls were recorded, and the staff was not allowed to share their results with each other, which was not feasible since they all worked in a small building. Shockley, not trusting his employees, was sending their reports to Bell Labs for double-checking. At some point, he sent the entire lab for a lie detector test, though everyone refused.
The team started losing its members, starting with Jones, a technologist, who left in January 1957 due to a conflict with Grinich and Hoerni. Noyce and Moore then stood on different sides: Moore led the dissidents, whereas Noyce stood behind Shockley and tried to resolve conflicts. Shockley appreciated that and considered Noyce as his sole support in the group.
Resignation
In March 1957, Kleiner, who was beyond Shockley's suspicions, asked permission ostensibly to visit an exhibition in Los Angeles. Instead, he flew to New York to seek investors for a new company, and his parents, New York residents, assisted him. Kleiner was supported by Blank, Grinich, Last, Roberts, Hoerni and Moore. Arthur Rock and Alfred Coyle from Hayden, Stone & Co. became interested in the offer, believing that trainees of a Nobel laureate were destined to succeed.As a last resort, on May 29, 1957, a group led by Moore presented Arnold Beckman with an ultimatum: solve the "Shockley problem" or they would leave. Moore suggested finding a professor position for Shockley and replacing him in the lab with a professional manager. Beckman refused, believing that Shockley could still improve the situation, later regretting this decision.
In June 1957, Beckman finally put a manager between Shockley and the team, but by then seven key employees had already made their decision. At the last minute they were joined by Noyce. Roberts persuaded him to attend the meeting of the "California group", as they called themselves in the agreement with Fairchild. The meeting was held at the Clift Hotel in San Francisco and was attended by Rock and Coyle. These ten people became the core of a new company.
Finding investors proved to be difficult. The US electronics industry was concentrated in the east, and the California group preferred to stay near Palo Alto. In August 1957, Rock and Coyle met with the inventor and businessman Sherman Fairchild, founder of Fairchild Aircraft and Fairchild Camera. Fairchild sent Rock to his deputy, Richard Hodgson. Hodgson, risking his reputation, accepted the offer and within a few weeks completed all paperwork. The capital of the new company, Fairchild Semiconductor, was divided into 1,325 shares. Each member of the traitorous eight received 100 shares, 225 shares went to Hayden, Stone & Co and 300 shares remained in reserve. Fairchild provided a loan of $1.38 million. To secure the loan, the traitorous eight gave Fairchild the voting rights on their shares, with the right to buy their shares at a fixed total price of $3 million.
On September 18, 1957, Blank, Grinich, Kleiner, Last, Moore, Noyce, Roberts, and Hoerni resigned from Shockley Labs. They became known as the "traitorous eight", though it is not known who coined the term. Shockley could never understand the reasons for this defection. After that time, he never talked to Noyce again, but continued to follow the work of "The Eight." He also combed through all records left by The Eight, basing patents, held as Shockley Labs' intellectual property, on any important ideas.
In 1960, with the help of a new team, Shockley brought his own diode to serial production, but time had been lost, and competitors had already come close to the development of integrated circuits. Beckman sold the unprofitable Shockley Labs to investors from Cleveland. On July 23, 1961, Shockley was seriously injured in a car crash, and after recovery left the company and returned to teaching at Stanford. In 1969, IT&T, the new owners of Shockley Labs, moved the company to Florida. When the staff refused to move, the lab ceased to exist.