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Even with the fundamentals laid down, electronics had little place to move in terms of computing. Vacuum tubes were very bulky and ate a lot of electricity to do simple tasks. Early computers took up whole rooms and had the computing power of most modern microcontrollers but, they did their job. It wasn't until the advancement of semi-conductors that we truly saw the miniaturization of electronics. With the semiconductor came the transistor and with the transistor and the advent of advanced photo etching processes we eventually got the integrated circuit and the microprocessor. This paved the way for modern electronics that now work on a scale of about 45 nanometers (a lone Si atom is .1 nanometers wide)
So what is so special about semiconductors? Silicon is the most famous semiconductor. Silicon in its natural state makes a nice lattice because it has 4 valance electrons and wants 8, so it bond with 4 other Si and makes a lattice. A lattice is very strong atomic structure and does not conduct electricity, thus making pure Silicon a insulator. However you can add impurities to silicon to change the way it conducts electricity. This is called doping. If you dope silicon with something like gallium(Ga)which has 3 valance electrons, you end up having a spare electron on the silicon that has no where to go. This lone electron is free to flow and thus, current flows. This type of silicon is called N-type and is a decent conductor. You can also dope silicon with something such as arsenic, which has 5 valance electrons. This creates a positive "hole" where a absence of electrons exists. Flowing electrons can take up this space and move the hole, this allows current to flow. This is called P-type and is also a decent conductor.
This is why silicon is a "Semiconductor" it will not conduct electricity in one state but will in another. Its not the states alone that are fascinating, but its what happens when you put them together.
The Diode
The diode is another fundamental component. Its basic function is to allow current in only one direction. This is crucial as it protects components and makes sure current only goes one way. It accomplishes this by creating a junction of P-type and N-Type silicon like so:
------------[(P-Type)|(N-Type)]------------
When you hook up a battery backwards like this:
(-)------------[(P-Type)|(N-Type)]------------(+)
The holes in the P-type are attracted to the negative terminal and the electrons are attracted to the positive terminal. No current is allowed to flow.
When you hook up a batter the correct way:
(+)------------[(P-Type)|(N-Type)]------------(-)
The electrons are repealed by the negative terminal as the holes are to the positive terminal. At the junction the electrons meet with holes and begin filling them. Current flows across the junction.
The diode only allows current to flow when it is properly placed in a circuit. However it isn't nearly as significant as the next component.
The Transitor
Without the transistor, none of this would be possible. The transistor is the modern computer. A transistor is merely a diode, but going one step further. A transistor features 3 layers of doped silicon usually arranged as PNP or NPN (hence NPN And PNP transistors) by adding this third layer, you can create a switching effect. In a PNP transistor by supplying current to the middle layer you allow current to flow throughout the device. This fundamentally allows a small current to switch a large one.
By having this ability you can begin to build Boolean gates out of arrangements of transistors. If you have logic you can make computers.
This is the story of the semiconductor! After it was born it was a mad dash to implement complicated logic gates as well as the race to make the transistor smaller and smaller. This race lead us to our faithful component, the Microcontroller.