Visionaries> John C. Dvorak

Jan. 12, 2004
All Hail The Semiconductor Age

Every time the technology domain goes through a downturn, too many people get fearful that somehow the tech scene is "over." They flock to bio-tech or agriculture or genetics, thinking it will be the next big thing. Unfortunately for them, the next big thing will have to rely on further advances in basic semiconductor technology. The demand for new chips and new processes is certainly entrenched for years to come. So even though the gravy train stops to refuel once in a while, it's still the gravy train, moving or not. People hop off the train at their own risk. As a critic, people normally don't see me as a cheerleader. Yet general-tech boosterism seems appropriate because nobody else seems to be joining in. Many tell tales of gloom. But I personally see a scenario unfolding where we witness a tech boom even crazier than the one that has just passed.

Each tech boom since the invention of the microprocessor (or even the transistor) has been bigger than the last, and the boom-and-bust cycle is becoming more drastic. This should mean that a future boom and bust will be more dramatic than the dot-com bubble. However, nobody even mentions this distinct possibility.

Some causal event triggers everything in these cycles. The dot-com boom, I believe, was triggered by the instant billionaires created by the Netscape initial public offering (IPO). People have gotten rich overnight before, but this was different. The instant-billionaire phenomenon didn't suddenly disappear either. Rather, it's in hibernation. It should reawake when the excitement of the Google IPO sparks an investment frenzy that should begin by mid-2004.

Simply put, the investment community cannot just sit on money forever. That's not it's job. And there's a direct connection between the investment bankers, the venture capitalists, and the creative spirit of the technology community. When money is flowing, so are ideas. This weird symbiotic relationship is what makes Silicon Valley work. With so many exciting new technologies emerging—microelectromechanical systems (MEMS), nanotechnology, polymeric semiconductor concepts, clockless computing initiatives, ultra wideband (UWB), wireless everywhere, plus other fields of endeavor—there's money to be made.

One technology or idea may forge ahead to ignite another boom, yet it's too early to tell which one it will be. Or, it could be a combination of ideas. But there's one rule students of boom-and-bust economics always mind: It never happens the same way twice. The only sure thing is that semiconductor technologies will be in the middle of it. We're living in the Silicon or Semiconductor Age, no different in its importance than the Copper Age or the Bronze Age or the Iron Age—all historic milestones and long eras. This one is ours, and it has a long way to go. A very long way.

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