Analysis Links Lockheed and Defense Procurement to Silicon Valley’s Origins

A historical analysis presents the post-Cold War consolidation of the U.S. defense industry as a response to pressure from the Pentagon. The defense secretary told prime contractors that procurement spending was shrinking and would likely continue to decline for at least a decade, meaning fewer suppliers would be needed.

The analysis characterizes Lockheed and the military-industrial complex as foundational to Silicon Valley, arguing that Lockheed created much of the technology ecosystem in Sunnyvale. It estimates that Lockheed Missiles and Space employed roughly 10 times as many people as the rest of the local technology industry combined at the time, while early chip startups sold to Lockheed and military customers.