The semiconductor story is unparalleled in the history of mankind largely because of its effect on accelerating the advance in technology and the resulting effect on the world’s economy in the second half of the 20th century. This chapter examines how technology, manufacturing, and economics have intermingled to make this stunning history possible. Understanding the characteristics of the semiconductor market is critical in any decision making regarding manufacturing. The chapter examines each source of instability and their affect on the semiconductor manufacturing industry. Learning curve economies provide an important strategic advantage to the first company to enter a new market. The sooner a company enters a market, the quicker will be its gains from being first to ride down the learning curve. The current state of technology is the easiest to explain since it is the basis for an equipment market's size.