What a Difference 25 Years Makes

Electronic News, June 4, 2001 by Bernard Levine

ENews doyen looks back in wonder

Electronics, like love, don't come easy. Remember what Mama said. You can't hurry either one. No, you just have to wait, and trust in time. It's a game of give-and-take. You just have to wait.

The Supremes knew all this in the 1960s, but these lessons are also clear to me from 25 years covering the electronics industry for Electronic Ness. Change comes slowly, but enormous change occurs over time. It is a long way from Diana Ross and the Beatles to Jennifer Lopez and Limp Bizkit. And it is also quite a journey from the clunky mainframes and massive defense and space systems of the '60s and '70s to today's miniaturized notebooks, cell phones and PDAs.

I will be looking at a number of these changes and will make some predictions in this series commemorating my 25th anniversary with Electronic News.

Momentous innovations start out slow and take many years, even decades, to be fully realized, despite the initial hoopla. Even after the first promising signs appear and the first few new companies are created and fortunes made, there is still a huge amount of work remaining.

Revolutions in electronics such as the microprocessor or PC do come along, creating new industries with many new jobs. They also create huge challenges for electronics engineers and marketers. Revolutions take time, with plenty of heartaches and casualties along the way. Just ask the people who toiled at Long-departed PC pioneers such as Tandy, Commodore and Osborne.

Or ask the R&D experts who spent more than a decade inventing and perfecting space-saving surface-mount board assembly and related miniaturized component packaging and placement techniques. Surface mounting enabled the end-product miniaturization and portability we expect today. Without the down-sizing of ICs, passives and circuit boards, today's handheld consumer wonders would not be possible. Surface-mount frontiers, such as chip-scale and wafer-level semiconductor packaging, and grain-of-pepper-sized 0201 chip capacitors and other passives are still being worked on today.

In a quarter century at this newspaper, I have chronicled the progression from the world of 1976, dominated by IBM mainframes and AT&T telephones, to 2001's PCs, wireless electronics and Internet scene. And I have seen the transformations of both IBM and AT&T, which seemed to control most of the industry when I first got here, and the emergence of scores of new companies that have become industry leaders.

I have watched the electronics industry move from a huge dependence on defense in the '70s to the much more industrial/consumer business of today, although don't count on that staying the same forever. President Bush's missile-defense initiative may mean huge electronics outlays that could begin to turn around the long-depressed military electronics business. In the past, the mil/aerospace sector provided major funding for R&D that often found its way into commercial applications as well.

Over the past 25 years, I have also seen a pioneering U.S. semiconductor industry, challenged by rivals from Japan, South Korea and other countries,

struggle back to leadership through determination and innovation.

I have seen the emergence of megadistributors, and, later, mega-contract manufacturers. I have watched OEMs increasingly turn manufacturing and assembly over to contractors (now known as electronic manufacturing services providers). OEMs have also come to rely on new types of contractors -- semiconductor front-end and packaging foundries.

Also, I have followed the push to globalization which, since the end of the Cold War, has seen the industry greatly expand into Eastern Europe and now China. And in recent years, I have chronicled the industry's rush to the online space.

Wherever the industry has gone, there have always been plenty of surprises, pain, and ups and downs along the way. Anyone who has recently watched long-growing 401K portfolios suddenly shrink in value knows about these ups and downs. The suddenly depressed business climate of 2001 has reminded many that a good technology or idea, such as e-commerce or the Web, doesn't guarantee an instant pot of gold. Surprisingly to some, stock prices can go down as well as up; and every bright young dot-com recruit is not going to become rich and retire by 30.

More next week, but for now, take heart. Things rarely work out exactly as expected, or as quickly, but they do have a way of working out. Remember what Mama said. You can't hurry love. No, you just have to wait. Even those depressed 401Ks will come back; it's just a game of give-and-take.