ELECTRONICS: The New Age

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At the height of their success, Ramo and Wooldridge suddenly walked out. Partly, it was because of a bitter fight (TIME, Oct. 5, 1953) over how much authority they should have in company policy. Partly, too, they wanted to move on to bigger and better projects by themselves. Says Wooldridge: "Our product was scientific and engineering competence. What we hoped to sell was the ability to tackle some of the more difficult technical problems—not just establish that they were scientifically possible, but that they could be built within the state of the art."

In the Black. They rented their first office and sat down to draw up a list of possible financial backers. The first name was Cleveland's Thompson Products, Inc., which already had its foot in the electronics door with a parts subcontract for Hughes's Falcon missile. As soon as Thompson heard from Ramo and Wooldridge. it told them to look no farther—just hurry to Cleveland to work out the financing details. Though Howard Hughes offered to help finance their new venture, it was too late.

In exchange for 3,500 shares of preferred stock (87½%) and 24,500 shares (49%) of Ramo-Wooldridge's common stock, the remainder of which the two scientists kept for themselves and future staffers, Thompson put an initial $400,000 into the baby corporation. Within a week R-W got its first Air Force study contract for a secret project, quickly picked up more such contracts. Three months later R-W was in the black.

Made to Order. Their technical reputations grew so fast that when the Government asked the late great Mathematician John Von Neumann to set up a committee to study the future development of strategic guided missiles, Ramo and Wooldridge were picked as members. The committee decided that the ICBM could be built, turned over its report to the Government which felt that it was too big a job for one company or for the Air Force to handle alone. What was needed was a unique setup—a new civilian technical group that could work under the Air Force and supervise the companies turning out the components for the missile. Ramo's and Wooldridge's new company seemed made to order for the big job. Today missile work accounts for about 50% ($13.4 million in 1956) of R-W's total business. Yet it is the least of Wooldridge's and Ramo's hopes for their company. Says Ramo: "You can't make money and you can't stay in business without production." To get the necessary production, R-W is diversifying with six divisions (and two laboratories), whose job is to conceive and produce everything from miniaturized components to pieces of equipment and entire electronics systems. A subsidiary, Pacific Semiconductors, 50% owned by Thompson Products, is in mass production of transistors and diodes for the component market. R-W's equipment divisions are producing airborne digital computers and ground instruments for testing missiles; its systems divisions are busy developing a line of data-handling systems for the military, the guidance control system for a new and as yet unannounced missile, a radically new communications system, and a series of electronic process controls to run U.S. factories in the coming age of automation.