semiconductors fate acquired by texas instruments 1 founded may 27 1959 1959 05 27 in danbury connecticut united states defunct september 23 2011 2011 09 23 headquarters santa clara california united states key people donald macleod chairman & ceo products semiconductors revenue 1.42 billion usd 2010 operating income 325.8 million usd 2010 net income 209.2 million usd 2010 number of employees 5 800 2010 parent texas instruments website www.ti.com national semiconductor was an american semiconductor manufacturer which specialized in analog devices and subsystems formerly with headquarters in santa clara california united states . the company produced power management integrated circuits display drivers audio and operational amplifiers communication interface products and data conversion solutions . national s key markets included wireless handsets displays and a variety of broad electronics markets including medical automotive industrial and test and measurement applications . on september 23 2011 the company formally became part of texas instruments as the silicon valley division . contents 1 history 1.1 founding 1.2 the transformation of national semiconductor 1.3 weaknesses of sporck s leadership 1.4 leadership under gilbert f. amelio 1.5 leadership under brian l. halla 1.6 leadership under donald macleod 1.7 acquisition by texas instruments 2 manufacturing locations 3 products 4 history of national semiconductor logo and product identification 5 see also 6 references 7 external links history edit founding edit national semiconductor 2 was founded in danbury connecticut by dr. bernard j. rothlein on may 27 1959 when he and seven colleagues edward n. clarke joseph j. gruber milton schneider robert l. hopkins robert l. hoch richard n. rau and arthur v. siefert left their employment at the semiconductor division of sperry rand corporation . the founding of the new company was followed by sperry rand filing a lawsuit against national semiconductor for patent infringement . 3 by 1965 as it was reaching the courts the preliminaries of the lawsuit had caused the stock value of national to be depressed . the depressed stock values allowed peter j sprague 4 to invest heavily in the company with sprague s family funds . sprague also relied on further financial backing from a pair of west coast investment firms and a new york underwriter to take control as the chairman of national semiconductor . at that time sprague was 27 years old . jeffrey s. young characterised the era as the beginning of venture capitalism . 5 that same year national semiconductor acquired molectro . molectro was founded in 1962 in santa clara california by j. nall and d. spittlehouse who were formerly employed at fairchild camera and instrument corporation . the acquisition also brought to national semiconductor two experts in linear semiconductor technologies robert widlar and dave talbert who were also formerly employed at fairchild . the acquisition of molectro provided national with the technology to launch itself in the fabrication and manufacture of monolithic integrated circuits . 6 7 in 1967 sprague hired five top executives away from fairchild among whom were charles e. sporck and pierre lamond . at the time of sporck s hiring robert noyce was de facto head of semiconductor operations at fairchild and sporck was his operations manager . sporck was appointed president and ceo of national . to make the deal better for sporck s hiring and appointment for half his former salary at fairchild sporck was allotted a substantial share of national s stock . in essence sporck took four of his personnel from fairchild with him as well as three others from ti perkin elmer and hewlett packard to form a new eight man team at national semiconductor . 5 incidentally sporck had been widlar s superior at fairchild before widlar left fairchild to join molectro due to a compensation dispute with sporck . 8 in 1968 national shifted its headquarters from danbury connecticut to santa clara california . however like many companies national retained its registration as a delaware corporation for legal and financial expediency . over the years national semiconductor acquired several companies like fairchild semiconductor 1987 and cyrix 1997 . however over time national semiconductor spun off these acquisitions . fairchild semiconductor became a separate company again in 1997 and the cyrix microprocessors division was sold to via technologies of taiwan in 1999 . from 1997 to 2002 national enjoyed a large amount of publicity and awards with the development of the cyrix media center cyrix webpad webpad metro and national origami pda concept devices created by national s conceptual products group . based largely on the success of the webpad national formed the information appliance division highly integrated processors & internet gadgets in 1998 . the information appliance division was sold to amd in 2003 . other business like digital wireless chipsets image sensors pc i o chipsets have also been recently closed down or sold off as national has reincarnated itself as a high performance analog semiconductor company . the transformation of national semiconductor edit the national semiconductor 8250 uart chip one of the most prolific and most cloned uart chips due to its presence in the first ibm personal computer . peter sprague pierre lamond and the affectionately called charlie sporck worked hand in hand with support of the board of directors to transform the company into a multinational and world class semiconductor concern . immediately after becoming ceo sporck started an historic price war among semiconductor companies which then trimmed the number of competitors in the field . among the casualties to exit the semiconductor business were general electric and westinghouse . 9 cost control overhead reduction and a focus on profits implemented by sporck was the key element to national surviving the price war and subsequently in 1981 becoming the first semiconductor company to reach the us 1 billion annual sales mark . however the foundation that made national successful was its expertise in analogue electronics ttl transistor transistor logic and mosfet metal oxide semiconductor field effect transistor integrated circuit technologies . as they had while employed in fairchild sporck and lamond directed national semiconductor towards the growing industrial and commercial markets and to rely less on military and aerospace contracts . those decisions coupled with inflationary growth in use of computers provided the market for the expansion of national . meanwhile sources of funds associated with sprague coupled with creative structuring of cash flow buffering due to sporck and lamond provided the financing required for that expansion . lamond and sporck had also managed to attract and extract substantial funds to finance the expansion . 10 among sporck s cost control efforts was his attraction towards low cost labour and outsourcing of labour . national semiconductor was among the pioneers in the semiconductor industry to invest in facilities to perform final manufacturing operations of integrated circuits in developing countries especially in southeast asia . national semiconductor s manufacturing improvements under sporck in collaboration with lamond had not been enabled by emphasis on process innovation but on improving and standardizing processes already established by other companies like fairchild and texas instruments as well as by frequent raiding to hire from fairchild s pool of talents . weaknesses of sporck s leadership edit national semiconductor under sporck was not particularly invested in marketing strategies even though it had the vision to launch itself into new and apparent opportunities in the consumer market . sporck had applied strategies that made national semiconductor function as a low cost mass manufacturer of semiconductor commodities . 11 it seems that companies like sony of japan and swatch of switzerland understood that the consumer market is much less a commodities market where low cost of products does not always equal demand for such products . a few key executives and engineers left the company in 1981 . among them was pierre lamond who had been the chief ic designer now partner at sequoia capital . 12 robert swanson s leaving the company in the same year to found linear technology was another indication of the appropriateness of organisational strategies of national semiconductor under sporck . for 13 of 14 years at national i was a gung ho guy . then the company started to get big . i kept looking at all the companies whose butts we d been kicking . and then national started organizing itself like them . it was frustrating . swanson said in the may 13 1991 business journal san jose . sporck s strategy of outsourcing sales to external sources meant national semiconductor did not have sufficient or responsive resources to respond to requests from innovators inventors and academic research which would have been helpful in the technological innovation boom of the 1980s . national semiconductor s lack and loss of innovation meant it was producing products that were easily copied and reproducible . it may have been the cheapest manufacturer in the united states but it was not the cheapest compared to the asian manufacturers . this weakness in national semiconductor was evident in its failure to compete during the globalisation of japanese semiconductor companies in the 1980s followed by the taiwanese and south koreans . leadership under gilbert f. amelio edit on may 27 1991 charles e. sporck was replaced by gilbert f. amelio as ceo and president . amelio was then president of rockwell international s semiconductor division and had a ph.d. in physics from georgia institute of technology . amelio had also been formerly employed at fairchild . amelio was faced with a company plagued with over capacity and shrinking market share . amelio found that just prior to his taking helm despite having spent us 1 billion over the last five years on research and development national semiconductor had a disappointing record in new products . the business section of the new york times january 11 1991 reflected the over capacity generated by sporck that had to be inherited by amelio . amelio disposed off the non core products and assets in which national semiconductor had no market motivation or expertise and turned the company towards its core expertise analogue semiconductors . national semiconductor under amelio emphasized on reduction of cost of sales improving capacity utilization scrap reduction and cycle time reduction . redundant facilities were sold and consolidated . with the progress of restructuring national semiconductor increased revenues each year . in 1994 national semiconductor under amelio posted record net revenues of us 2.29 billion . it was also a time when us semiconductor companies had regained market leadership . amelio introduced benchmarking to evaluate productivity restructured marketing strategies and reorganised management by introducing modern management practices and workplace environments . amelio divided products into two divisions standard products group which comprised low margin logic and memory chips commodity products which were more susceptible to cyclical demands and through which national semiconductor had matured ; and communications & computing group which comprised high margin value added analogue and mixed signal chips . amelio s thus division of products seemed to prepare national semiconductor for the eventual disposal of low margin commodity products which came to fruition later with the sale of a reconstituted fairchild . national semiconductor under amelio chose to build a brand new eight inch 200 mm wafer fabrication plant in south portland maine . it chose to divest itself from its then somewhat new plant in migdal haemek israel which became tower semiconductor . in 1995 amelio was elected as the chairman of the board of directors of national semiconductor . in 1996 amelio accepted invitation from apple computer a customer of national semiconductor to join its board of directors . troubles at apple later prompted the board to invite amelio to take on the position of ceo which he accepted in february 1996 . national semiconductor announced the resignation of amelio as the company s president chairman and chief executive officer on february 2 1996 . leadership under brian l. halla edit national semiconductor announced the appointment of brian l. halla as its chairman president and ceo on may 3 1996 . halla