Economy
In reply to the discussion: STOCK MARKET WATCH -- Monday, 23 January 2012 [View all]FarCenter
(19,429 posts)Back in the '70s and '80s, the consumer electronics business was lost to the Japanese (actually, it may have been deliberately handed to them in order to strengthen their geopolitical role as our "unsinkable aircraft carrier" during the Cold War). It started with transistor radios, then record players, tape recorders, televisions, and high fidelity component systems. US manufacturers were gradually forced to either exit the field or to set up shop in Korea and Taiwan. Finally, as Korea and Taiwan started to compete with the transplants, the US manufacturers went to Malaysia, Thailand, Indonesia, and at last to China in an effort to stay competitive. Meanwhile, Japan, Korea, and Taiwan companies also put factories into southeast Asia and China.
During this whole process of moving final assembly of products to Asia, a whole ecosystem of suppliers of parts like plastic molded bits, small metal pieces, discrete components like capacitors, resistors, diodes, etc, and discrete analog and logic circuits emerged in Asia. While the semiconductor fabs still produced wafers in the US, they sent the wafers to Asia where they were cut into chips, the chips were tested, and the chips were wirebonded to the chip carriers for installation into circuit boards. Later, the Japanese and Taiwanese companies set up their own semiconductor fabs and their own semiconductor design operations.
The industry in the US was reduced to industrial and military electronics (expensive, bulky, low volume), semiconductor and product design, and some of the tooling needed for semiconductor manufacturing and for electronics assembly.
At this point the US has no ability to get back into manufacturing high-volume, small, precision consumer electronics, along with all of the production systems needed for a complete supply chain of all the parts and pieces.
It was always obvious that the $3000 to $10,000 personal computers and workstations of the 1980s would evolve from bulky, power hungry, multi-modular systems into small, integrated, inexpensive consumer electronics like systems. Previously, the bulky, power hungry, multi-modular high fidelity audio systems made in the US had evolved into small, integrated, inexpensive book-shelf audio systems made in Asia. There were sophisticated HP and TI calculators, early PDAs and early attempts like the Apple Newton that clearly pointed the way. The only reason it took so long to go from a $10,000 Sun Workstation to an iPad was that people found more and more applications that absorbed computing power and keep systems larger and more power hungry longer than anticipated.
So it was always obvious that because the US had exited the consumer electronics business, it also would be forced to exit the personal computing and workstation manufacturing business.
PS-- In communications, telephone equipment for the home was produced in the US until the Bell System was broken up in the mid-80s. As soon as that happened, manufacturing of telephone sets went to Asia, and the Western Electric plants in Indianapolis and Shreveport were shut down.