With Silicon Mountain a memory, cyber peaks form

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No one’s touting Silicon Mountain anymore. And while “Cyber Mountain” might be more accurate today, it doesn’t have the same ring to it.

The Silicon Mountain nickname had its moment in the Springs in the 1980s, as tech firms made manufacturing footprints across the city. They included Springs-headquartered companies like Simtek Corporation, an early leader in SONOS memory technology, and Inmos Corporation, which built semiconductor fabrication facilities here. Digital Equipment Corporation moved its hard disk drive manufacturing and mass storage development labs to Colorado Springs, and the city attracted divisions of other big-name operations — Mostek, Texas Instruments, Litton Data Systems, TRW Inc., IBM’s Rolm, Ford Aerospace and Communications, NCR, Hewlett-Packard, Honeywell.

“What was it like then? It was just a really exciting place for high tech activities,” said Loren Lancaster, who’s an international business banker and longtime Pikes Peak Small Business Development Center consultant.

Back then, he was establishing semiconductor-based startups in the Springs. Semiconductor industry pioneer Richard Petritz originally brought him here in the ’80s, he said, to help build Simtek Corporation.

“There were several little organizations in town at that time who were big employers,” Lancaster recalled. “I personally give a lot of credit to Dick Petritz. He was the leader of Texas Instruments’ R&D facility for many years, but then he started Mostek … and he moved it to Colorado Springs.

“… Dick also started Inmos in Colorado Springs, and that was a huge employer. And Brian Hegarty was the vice president of the solid state electronic division for Honeywell, and he moved all their operations to Colorado Springs and built a facility.

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“All three of those corporations were just extremely exciting places to work for high tech engineers and scientists.”

In June 1985, The New York Times ran a story headlined “Cracks in Silicon Mountain,” noting the area’s high-tech companies had “gone through a dramatic boom-and-bust cycle … with a surprising number of companies [falling] victim to the hard times that have also hit electronics companies in the more famous Silicon Valley.” Mostek, for example, closed its Colorado Springs semiconductor plant in May that year, laying off 400.

But there were nine semiconductor manufacturers in Colorado Springs in 1987, and Lancaster puts the tipping point for Silicon Mountain’s decline later — the late ’90s or early 2000s. He said that’s when the industry’s fluctuations — that “boom and bust” — rattled city leaders and changed things.

“I have my own perspectives, which aren’t necessarily universally understood or welcome,” he said. “The talent here used to be more focused on high tech and the leaders embraced the idea. But high tech by its very nature is very cyclical; it’s very sensitive to economic cycles, compared to other industries … . So a lot of the town leaders decided instead of continuing to recruit and support high tech industry, they wanted to diversify into other markets. And so when opportunities presented themselves, like with Korean manufacturers that came here … the town just didn’t really want to invest in supporting those, because of the cyclical nature of those employers.

“I think, frankly, it was a little bit naive of our city leaders to believe that diversifying away from tech would help mitigate the damage that cities like us experience [during an economic downturn],” he added. “It’s just going to happen. Downturns in housing, especially.”

Lancaster said Silicon Mountain was also negatively impacted by “global competition factors which are completely outside of our hands,” adding, “The bottom line though, is that the choice that many of our highly vocal city leaders made to move away from technology is something that was a tremendous disappointment to me and many others. Because technology companies employ usually really well educated, highly paid engineers and scientists — and they also create lots of jobs for people who don’t have those kinds of degrees, and they’re also well paid.

“So it was a little disappointing. … I don’t think we’ve ever really fully recovered from that loss.”

IBM phased out its Rolm manufacturing plant in Colorado Springs starting in 1989. Texas Instruments phased out its Colorado Springs plant in 1991. In 1994, Hyundai Electronics bought out NCR Microelectronics. Litton left the Springs in 1995. Intel shuttered its Springs semiconductor chip plant in 2007.

Silicon Mountain was about manufacturing — computer chips, circuit boards, semiconductors —and as CBRE’s 2018 Colorado Tech Report notes, large high-tech manufacturers are no longer the prime movers in this market.

But the region’s tech landscape hasn’t necessarily weakened. It has transformed.

“Lately, software has distinguished itself as a driving force in the market and the start-up scene is expanding,” the report states. “Cherwell Software has made a name for itself among software companies and raised $172 million in 2018 alone. At least four tech companies expanded their footprint in Colorado Springs in the past year, including Harris Corporation, Analog Devices and General Dynamics.

“Aerospace and data centers are heavy hitters in the continually-diversifying Colorado Springs market,” it added. “Outgoing military personnel with technical training feed the growing niche tech sectors in the market.”

Cybersecurity is becoming a major tech player in the Springs, according to the report. Springs cybersecurity leaders have said the city enjoys unique advantages that will boost its recognition as a cybersecurity hub. They point to the National Cybersecurity Center, the vast military and government presence, Air Force CyberWorx, cyber tech accelerator Exponential Impact, the nonprofit Cyber Resilience Institute, Catalyst Campus, academic institutions active in cyber education and industry partnerships, cross-sector collaboration, broad political support for cybersecurity development, innovative local companies, low cost of living, and workforce development efforts.

The Springs boasts five NSA-certified Centers of Academic Excellence in Cyber, and the Colorado Springs Chamber & EDC is leading the Regional Cybersecurity Strategic Plan, which aims to elevate the city’s status as a cybersecurity hub.

National Cybersecurity Center CEO Vance Brown has noted the Silicon Mountain era several times in the past, but says he wouldn’t want to go back to that now.

“Although there’s still chip manufacturing, I don’t think that’s our forte in the Springs anymore,” he said. “I say, ‘You’ve got to include and transcend.’ Take what’s great about your past and then you transcend it with how you’re moving forward.”

In that vein, Brown sees parallels between the city’s tech past and cybersecurity’s recent surge as a force in Colorado Springs.

“With the cyber and the other emerging technologies that we’re bringing into the Springs — through Exponential Impact, for instance — we are embracing a bunch of technologies with exponential growth versus linear growth, just as I believe we did back in the day, when we became Silicon Mountain,” he said. “I believe we embraced, back then, what was really called exponential at the time.”

Lancaster said ’80s tech pioneers like Hegarty and Petritz set “the framework and the landscape for hiring talent and bringing it to the Springs,” and we’re reaping the benefits to this day.

“Even though their companies transformed in many different ways,” he said, “the massive amount of people they recruited to come here ultimately spun off and created lots of different little companies and, to some degree, even second-generation companies.”

So what’s needed?

“I think, frankly, the model of recruiting companies and having them come here has been proven to be less than ideal because those companies end up leaving more readily than homegrown companies,” Lancaster said.

He doesn’t think we should stop recruiting companies, but “at the same time, especially in software, there’s a huge opportunity to strengthen our ability to create homegrown startups.”

To reach its potential as a cybersecurity and tech hub, Brown said, Colorado Springs needs to be able to “attract companies that are further along” (post seed funding) and for the community to continue embracing enthusiastic collaborations and partnerships.

“Our momentum is because the community is coming together,” he said. “We have an ecosystem, from [UCCS] to business to some of these organizations like NCC that are there to promote the ecosystem.

“So I believe in the community really coming together and heading in the same direction, and the synergy that comes from that. It’s a mystery why it works, but it works … and I’m starting to see more of that than ever before. Exhibit A is what happened with Exponential Impact, NCC and the university all now being housed in the same building. I mean, I don’t think historically you’d have seen that kind of collaboration. And that’s what I mean by transcendence. That’s how we’ll transcend.”