Chip War: The Fight for the World's Most Critical Technology

by Chris Miller

The microprocessor market seemed almost certain to grow. But the prospect that microprocessor sales could overtake DRAMs, which constituted the bulk of chip sales, seemed mind-boggling, one of Grove’s deputies recalled. Grove saw no other choice. “If we got kicked out and the board brought in a new CEO, what do you think he would do?” Grove asked Moore, who wanted to keep producing DRAM chips. “He would get us out of memories,” Moore admitted sheepishly. Finally, Intel decided to leave memories, surrendering the DRAM market to the Japanese and focusing on microprocessors for PCs. It was a gutsy gamble for a company that had been built on DRAMs. “Disruptive innovation” sounded attractive in Clayton Christensen’s theory, but it was gut-wrenching in practice, a time of “gnashing of teeth,” Grove remembered, and “bickering and arguments.” The disruption was obvious. The innovation would take years to pay off, if it ever did.