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Baby Giants. Some of the giants of the electronics industry—RCA, General Electric, Sylvania—have dominated the market in transistors for consumer applications, which do not demand close tolerances. But several smaller companies, such as General Transistor and Transitron, have taken the lead in many high-quality semiconductors. Biggest in this field is Texas Instruments (TIME, April 8, 1957), whose sales have been growing at 30% a year, this year will hit $90 million. Hughes Aircraft, which geared up in 1954 to produce semiconductors for its own fire-control systems, now sells $15 million to $20 million worth per year. General Transistor is an even more remarkable example of how fast an electronics company can grow. The company was formed in 1954 by Electronics Engineer Herman Fialkov, 36, with only $105,000. He disregarded the advice that only the giant firms could hold a market, specialized in computer transistors. He sold $1,100,000 in 1956, $3,300,000 in 1957, expects to sell $5,500,000 this year, at least $8,000,000 next year, net at least $800,000. Though transistors have scarcely got their start in the second generation of computers, several firms are already at work on semiconductors for a third generation: silicon diodes, which serve as amplifiers at microwave frequencies, can help a computer in a missile system to arrive at its answer even faster than existing transistors.
The Quick & the Dead. Such rapid changes make mortality in the industry high. Of 81 companies that entered the field since the discovery of the transistor ten years ago, 50 have given up or are slipping fast, and only a dozen or so are vigorous competitors. Eventually, electronics experts expect a shakeout down to six or seven major producers. "We expect it," says General Transistors' Fialkov, "and we expect to be one of the survivors. There will always be a market for smaller specialty producers, because only one or two companies manufacture the same type of transistor."