Prior to Kilby's discovery, circuits had to be constructed by interconnecting various components with wiring. This hampered the development of larger, more complex circuits since it would lead to devices made mostly of wires and lead to a condition known as 'the tyranny of numbers'.
Kilby solved the problem by constructing all of the basic circuit components out of the same semiconductor material. This allowed for the circuits to be constructed on a single piece of material without the need for large amounts of wiring or the risk of faulty components.
As a junior employee, Kilby was not given vacation time and was left alone while the rest of the staff went on summer holiday. During that stretch, Kilby constructed the circuit on a single slice of germanium, laying the bedrock for what would later become the microchip.
Though Kilby's germanium circuit was trumped six months later by the silicon integrated circuit developed separately by Robert Noyce, he is still regarded as a co-inventor of the device and in 2000 was awarded the Nobel Prize in physics for the design.
Kilby died in 2005 at the age of 80. The semiconductor industry he helped create has garnered some US$265 billion in total sales.
"In the ensuing half century since Kilby's invention, the integrated circuit has proved to be the single most important driver of increased productivity and economic growth in history," said George Scalise, president of the Semiconductor Industry Association.
"The integrated circuit provides the critical technology for countless electronic devices that enable people everywhere to lead more productive lives."