INDUSTRY ORGANISATION

Industry organization. The computer and electronic product manufacturing industry has many segments. Companies in the industry are generally classified by what they sell.
Computer and peripheral manufacturing is made up of a wide variety of companies that make computers and computer-related products. A relatively large number of companies build computers for home or business use. Most computers are built by a small number of well-known brands, but there are also many small companies that sell their products locally or on the Internet. Because computers are very complex products, they are made up of a wide range of components, such as motherboards, central processing units, graphics cards, hard disk drives, and power supplies. Although some computer manufacturers build some of these products themselves, many of these products are purchased from other companies and assembled as part of the computer. As a result, many finished computers are simply the combination of a number of other products.
Other firms in this industry segment produce computer-related products, known as peripheral equipment. These products include keyboards, mice, printers and scanners. Other peripherals are physically installed in the computer’s case, and are generally known as internal peripherals. These include hard disk drives, networking cards, modems, sound cards, and disk drives. Many internal peripherals are prepackaged as part of a computer, although almost all of them can be installed by a technician or experienced computer owner.
The communications equipment manufacturing segment of the industry produces a number of devices that simplify communication between individuals or groups. It includes telephones and cellular telephones, as well as equipment used by television and radio stations to transmit information. It should be noted that this does not include computer-related peripherals—such as networking cards or modems—which allow computers to connect to other computers.
Audio and video equipment manufacturing is a relatively small industry in the United States and includes companies who produce consumer electronics. These include televisions, stereo receivers, compact disc and DVD players, and other such devices. While these devices are widespread in the U.S., most of them are produced overseas, making employment in this industry relatively small.
Semiconductor and other electronic component manufacturers produce a wide variety of integrated circuits, or computer microchips, which power a wide range of electronic products. They also produce a number of other electronic components, such as resistors and capacitors, as well as printed circuit boards. Unlike most of the companies in this industry, these manufacturers start from basic materials such as silicon and copper and produce intermediate products that are only rarely sold directly to consumers. The exceptions to this rule include companies which produce central processing units and memory chips, although even these products are more likely to be pre-installed in a new computer.
Fabrication plants that build semiconductor products, known as “fabs”, are fitted with dust-free zones called “cleanrooms”. Microchip circuitry is so small and complex that it can be ruined by microscopic particles floating in the air, so semiconductor products must be built by computer-controlled machines in an environment with very little human intervention. Most production workers in this industry segment are actually more involved in evaluating manufacturing methods and testing completed chips. Semiconductor manufacturers also spend an inordinate amount of money on research and development—more than most companies in the entire computer and electronic product manufacturing industry.
The navigational, measuring, electromedical, and control instruments manufacturing segment is a diverse group of companies that produce products mainly for industrial, military and health care use. It also includes some consumer products, such as global positioning system (GPS) devices, as well as clocks and watches. This segment is one of the largest in the industry, mainly because the Federal Government puts so much money into defense and health care.
Many of the companies in this segment work as government contractors, producing equipment for military purposes. In some cases, this technology has been adapted for consumer use. For example, GPS technology was originally designed for use by the U.S. Navy, but has been developed into a navigation system that individuals can use in their cars. There is also a growing health care component of this industry segment. Extensive government funding for research in medical technology has led to a number of important innovations that are being used worldwide in medical care.
Manufacturing and reproducing magnetic and optical media is another segment of this industry. Firms in this segment produce blank compact discs, DVDs, and audio and video tape. They produce some of this blank media for sale to consumers, but most of it they use to duplicate on a mass scale audio recordings, videos and movies, software, and other media for distribution to consumers and business users. Establishments in this segment are generally either subsidiaries of companies that create the software, movies, or recordings or are independent firms licensed by such companies as distributors.
Recent developments. The rapid pace of innovation in electronics technology makes for a constant demand for newer and faster products and applications. This demand puts a greater emphasis on R&D than is typical in most manufacturing operations. Being the first firm to market a new or better product can mean success for both the product and the firm. Even for many relatively commonplace items, R&D continues to result in better, cheaper products with more desirable features. For example, a company that develops a new kind of computer chip to be used in many brands of computers can earn millions of dollars in sales until a competitor is able to improve on that design. Many employees, therefore, are research scientists, engineers, and technicians whose job it is to continually develop and improve products.
The product design process includes not only the initial design, but also development work, which ensures that the product functions properly and can be manufactured as inexpensively as possible. When a product is manufactured, the components are assembled, usually by soldering them to a printed circuit board by means of automated equipment. Hand assembly of small parts requires both good eyesight and coordination, but because of the cost and precision involved, assembly and packaging are becoming highly automated.