What Is Silicon Valley? - Definition & History

Instructor: Erin Carroll

Erin has taught English and History. She has a bachelor's degree in History, and a master's degree in International Relations

Learn about the history of Silicon Valley, from its humble beginnings before WWII to its position as the worldwide hub of technology innovation. We'll focus on the three factors that made Silicon Valley so successful. Then, you can test yourself with a short quiz.

A Valley of Silicon?

Every single day our lives are impacted by the technologies created in Silicon Valley. Whether it's opening up your Mac and logging onto Facebook, tweeting your followers or even Googling the best breakfast burritos in town, most of us have used the services of a tech company from Silicon Valley.

Silicon Valley refers to the Santa Clara Valley in Northern California south of San Francisco where the tech industry is centered. It is about 25 miles long and 10 miles wide. The name refers not only to its geographical location in a valley, but also to one of its most famous and important products, the silicon transistor, which is what makes our computers operate. The history and success of Silicon Valley is due to three important factors: the influence of a strong university research community, funding from the department of defense, and a few pioneering venture capitalists willing to fund risky ideas in the name of innovation, helping Silicon Valley develop into the hub of technology and creativity.

Silicon Valley skyline
Silicon Valley Skyline

The University Research Connection

The history of high tech Silicon Valley actually goes back all the way before WWII, and it's strongly tied to Stanford University and the research community there. In 1938, William Hewlett and David Packard, two Stanford graduates working out of a garage in Palo Alto, created a precision audio oscillator and founded the Hewlett-Packard company. Hewlett and Packard were both mentored during their time at Stanford by a man who turned out to be very influential: Fred Terman. Fred Terman was a Stanford engineering professor, but during WWII, he was asked to head the secret Radio Research Laboratory at Harvard University. After the war ended, Terman returned to Stanford on a mission to make it into a major engineering school and to attract funding for new technology industry in the area.

Fred Terman was appointed Stanford Provost from 1955-1965. During this time he poured his energy into attracting the top scientists and engineers to work and study at Stanford. He also started fostering relationships with emerging companies in the tech industry and encouraged his students to start their own enterprises nearby. Terman's efforts have led many to call him the 'Father of Silicon Valley'. He was also one of the leading minds behind the creation of the Stanford Industrial Park. Now called Stanford Research Park, it was a chunk of land devoted to the technology industry. By 1953, companies like Lockheed, Hewlett-Packard, and General Electric had taken up residence there.

Silicon Takes Center Stage

William Shockley and colleagues
William Shockley and colleagues

In 1956, William Shockley won the Nobel Prize for co-inventing the transistor. A transistor uses electric currents and works like an on/off switch. Computers need thousands of these switches to operate even the most basic task. Before this, computing machines were huge hulks using large vacuum tubes to operate. The smaller transistor allowed computers to become a little smaller. Shockley set up his company, Shockley Semiconductor Laboratories, in Mountain View, California, directly next to Palo Alto.

In 1957, eight of Shockley's employees broke away and used their own money to develop a method for the mass production of transistors made of silicon. They formed a company called Fairchild Semiconductor in Mountain View and began mass-producing the first silicon integrated circuits. These integrated circuits placed the thousands of transistors a computer needs on one tiny silicon chip and connected them all together. These tiny silicon chips made computers even smaller and is the reason why today we have tiny smartphone computers that fit in our hands! This revolutionized the computer industry, and by 1970 the industry was blossoming. In 1971, an electronics writer named Don Hoefler officially coined the term, 'Silicon Valley'.

An integrated circuit from a silicon memory chip
An Integrated Circuit from a Memory Chip

The Department of Defense Connection

In the 1950s, the Cold War began, and the DoD, (Department of Defense) recognized that new technologies were vital for combatting the Soviet Union. In 1957, the United States was shocked when the Soviet Union launched Sputnik, the first artificial satellite, into space. A year later, NASA was established to help the U.S. win the space race, and NASA needed tech to win. By 1964, Fairchild Semiconductor was producing over 100,000 integrated circuits to help NASA land a man on the moon. The DoD was awarding major contracts to the valley's tech companies. During the 1970s, Vinton Cerf came to Stanford where he worked on creating the protocols for Internet communication between computers with help and funding from a DoD agency. His pioneering work helped shape the Internet we use today.

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