A History of Silicon Valley

Table of Contents | Timeline of Silicon Valley | A photographic tour
History pages | Editor | Correspondence
Purchase the book

These are excerpts from Piero Scaruffi's book
"A History of Silicon Valley"


(Copyright © 2016 Piero Scaruffi)

17. Sharks: the iPhone, Cloud Computing, Location-based Services, Social Games, and Personal Genomics (2007-10)


The Decline of the Computer

Click here for this section

Towards Computing as a Utility

Click here for this section

Google versus Microsoft

Click here for this section

The Bay Area Giants

Click here for this section

Beyond Moore's Law

A bigger problem lay ahead for the semiconductor industry in general. In ultimate analysis a lot of computer technology's accelerating progress was due to its fundamental component: the transistor. Transistors were expensive in the 1960s. In 1982 they were already cheap enough that $1 could buy a few thousand of them. Twenty years later in 2002 the same dollar bill could buy more than two million of them. Thirty years later in 2013 the same dollar bill could buy 20 million transistors.

The semiconductor industry was very aware that Moore's law was rapidly coming to and end. As transistor gets smaller, it gets harder to make them. For the first time in 50 years there was a real chance that the price of transistor would stall or even increase. The industry began experimenting with new materials, such as carbon nanotubes and graphene, and even with quantum computing.


Social Games

Click here for this section

User Experience

Click here for this section

3D Printing

Click here for this section

Cyber-currency

Click here for this section

Mobile Payment

Some startups understood that mobile users carry a computer with them, not just a phone. In fact, they even carry a GPS that knows their location.

Bling Nation, founded in 2007 in Palo Alto by Argentinian serial entrepreneur Wenceslao Casares and Venezuelan economist Meyer Malka, developed a sticker for smartphones (or any other device) with an embedded NFC chip to charge purchases to a Paypal account.

In 2009 Jack Dorsey (of Twitter fame) founded Square and designed a "reader" that allowed anybody with a mobile phone to make a payment and anybody with a mobile phone (and a Square-provided "cash register") to accept it (no cash, no credit cards, no RFID, no receipt).


The Empire

Click here for this section

Neurotech

Click here for this section

Biotech

Click here for this section

Greentech

Click here for this section

Cold Fusion

In 1985 the US, the Soviet Union, Japan, and the European Union had launched a joint project to build the International Thermonuclear Experimental Reactor (ITER). The hope was that it would lead to a power plant fueled by fusion. ITER had been designed according to the Soviet tomahawk reactor invented by Soviet physicists Igor Tamm and Andrei Sakharov. The holy grail of nuclear fusion, however, was "cold fusion," i.e. fusion that does not require the high temperatures generated by such an expensive reactor. In March 1989 Stanley Pons, a chemist at the University of Utah, and Martin Fleischmann from the University of Southampton in Britain had announced that they had achieved "cold fusion," i.e. nuclear fusion at room temperature (about 20 degrees Celsius). Within a few months the scientific community had come to consider it a bluff, which discredited the entire field. Meanwhile, ignored by the media, in 1989 New Zealand electrochemist Michael McKubre had just begun to study cold fusion at SRI International. For about two decades the field had virtually been silenced by mainstream science. By the end of the 2000s interest had returned, as cold fusion would solve the problem of energy forever. Construction of ITER, mostly funded by the European Union, finally began in 2008 in southern France after India, mainland China, and South Korea had joined the original quartet. At the same time mainstream science began to accept the results on "cold fusion" that Michael McKubre's lab had achieved.

Meanwhile, hot fusion remained the scientifically proven way to go. The Livermore Labs were entrusted in 1997 with the National Ignition Facility (NIF). The project required high-power lasers to trigger nuclear fusion in the hydrogen fuel. The term "ignition" refers to the point when more energy is generated than is consumed by the plant. The Lawrence Livermore National Laboratory basically planned to simulate the nuclear fusion of a star (more than 100 million degrees Celsius, hotter than the center of the sun) with the world's most powerful laser.

The International Energy Agency was warning that the world needed a lot more nuclear power to avoid a catastrophic increase in global warming. Old and new technologies for fusion power, usually reserved for academic and military research, were being explored by startups such as TriAlpha, located near Los Angeles in California, and Transatomic Power, founded in Boston by Leslie Dewan and Mark Massie. Transatomic Power, Terrestrial Energy (Canada), Moltex (Britain) and Flibe Energy (Alabama) were working on molten-salt reactors, a technology first tested by Alvin Weinberg's team at Oak Ridge National Laboratory in Tennessee in 1965. These startups were also exploring thorium as a replacement for uranium (thorium is more abundant).


Lasers

One of the great scientific endeavors of the 2000s was a joint project among CalTech, MIT, and Stanford to detect gravitational waves: the Laser Interferometer Gravitational-Wave Observatory (LIGO). The most expensive project ever funded by the National Science Foundation (NSF), LIGO became operational in August 2002 in two observatories located 3,000 kilometers apart (Louisiana and Washington state). The experiment required the most precise measurement ever. Capitalizing on laser amplification studied by Robert Byer‘s team at Stanford, Ueda Kenichi in Japan developed transparent ceramic laser for high-energy applications that, in turn, led to Northrop Grumman’s announcement in 2009 that it had created a 100-kilowatt laser, an impressive achievement for a discipline that in 1984 could only produce two-milliwatt lasers. This combination of high precision and high energy was unprecedented in history. Livermore Labs’ researchers realized that the technology could also serve the purpose of the National Ignition Facility (NIF).

Lasers were also employed at the Lawrence Berkeley Labs to create a new generation of “miniature” particle accelerators. In 2006 Wim Leemans’ team accelerated electrons to a billion electronvolts (1GeV) in a distance of centimeters rather than hundreds of meters. The next project was the Berkeley Lab Laser Accelerator (BELLA), in which a laser would produce one-quadrillion watts (one billion million watts) for a millisecond, enough to accelerate electrons to an energy of 10 GeV in a distance of just one meter.

Meanwhile, SLAC inaugurated the Linac Coherent Light Source (LCLS), that in April 2009 produced the world’s brightest X-ray laser (X-rays being much higher-frequency radiations than microwaves). It was now technically possible to pinpoint a biological cell, and, generally speaking, explore matter at the molecular scale.

 


The Community: Coworking Spaces, Incubators and Accelerators

Click here for this section

Makers Movement

Click here for this section

Fintech

The financial world moved decisively online during the Great Recession. The demand of small businesses that could not borrow money was met by non-bank lenders such as OnDeck (New York, 2007), Kabbage (Atlanta, 2009) and Funding Circle (London, 2010).

Another alternative form of lending was devised by two companies founded in 2006 in San Francisco: peer-to-peer (social) lending. Prosper, founded by Chris Larsen, and LendingClub, founded by former Oracle executive Renaud Laplanche, provided marketplaces for lending that matched those who wanted to borrow money with people who wanted to lend money. Their platforms marked the marriage of fintech, P2P and the sharing economy The concept had been pioneered by Zopa in London the year before. Initially peer-to-peer lending was geographically confined but Virginia-based Zidisha, founded in 2009 by Julia Kurnia as a nonprofit, showed how one could also link lenders and borrowers in different countries.

Automated financial advisory was legitimized by the success of Betterment, founded in 2008 in New York by Jon Stein, and Personal Capital, founded in 2009 in Redwood City by EverBank's co-founder Rob Foregger, Paypal's former CEO Bill Harris and digital security expert Louie Gasparini. It was perhaps the most obvious case of automation in the financial world because all financial advisors were already using algorithms. Creating an algorithm-based financial advisor simply required access to those algorithms.


Culture and Society

Click here for this section

The Anthropology of the Age of Self-awareness

Click here for this section

The Gift Economy

Click here for this section

The New Labor

Websites like Etsy, founded in 2005 in New York, and eLance, founded in 1999 in Boston by Beerud Sheth, were allowing anybody to become a self-employed businessman. As jobs disappeared due to automation, the population of "entrepreneurs" was destined to skyrocket.

As Venkatesh Rao argued in his article "Entrepreneurs Are The New Labor" (2012), the number of startup founders was destined to increase exponentially but they could no longer be viewed as the old-fashioned entrepreneurs: in reality they were becoming the modern equivalent of specialized work. Artisans, craftsmen. The startup had become the modern form of apprenticeship: startup founders learn how the modern, lean company works. When a bigger company buys them out, they are de facto "hired" and transition from apprenticeship to full-fledged work. Large companies will increasingly be aggregations of startups, they will increasingly rely on a workforce of entrepreneurs.


The Assembly Line Model of Startup Funding

Click here for this section

The Big-Brother Web

Click here for this section

The Changing Nature of Innovation

Click here for this section

The Electronic Empire

Click here for this section

Google vs Apple vs Facebook vs...

Click here for this section

(Copyright © 2016 Piero Scaruffi)

Table of Contents | Timeline of Silicon Valley | A photographic tour
History pages | Editor | Correspondence