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Moore’s Law

20 January, 2016 - 15:30

In 1965, an engineer at Fairchild Semiconductor named Gordon Moore noted that the number of transistors on a computer chip doubled roughly every 18 to 24 months. A corollary to "Moore's Law," as that observation came to be known, is that the speed of microprocessors, at a constant cost, also doubles every 18 to 24 months. Moore's Law has held up for more than 40 years. It worked in 1969 when Moore's start-up, Intel Corp., put its first processor chip - the 4-bit, 104-KHz 4004 - into a Japanese calculator. It worked at the return of the century for Intel's 32-bit, 450-MHz Pentium II processor, which had 7.5 million transistors and was 233,000 times faster than the 2,300-transistor 4004. And it works today, when Intel’s Rio Rancho factory is expected to begin producing 45-nanometer chips -- meaning they will have features as tiny as 45-billionths of a meter -- in the second half of 2008. The transistors on such chips are so small that more than 30 million can fit onto the head of a pin. Intel says it will have a 1-billion-transistor powerhouse performing at 100,000 MIPS in 2011.

For users ranging from vast organizations to children playing computer games, it's been a fast, fun and mostly free ride. But can it last? Although observers have been saying for decades that exponential gains in chip performance would slow in a few years, experts today generally agree that Moore's Law will continue to govern the industry for another 10 years, at least. Moore’s Law is illustrated graphically in Figure 10.2, which shows the increases

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Figure 10.2 Moore's Law 
 

The implications of Moore’s Law are that computing power becomes ever faster, ever cheaper. This not only means that just about everyone can therefore have affordable access to powerful computing, but that the power of computers can be built into devices other than computers themselves. Moore’s Law also drives convergence by placing computer chips into objects that previously had nothing to do with them - today there is more processing power in the average cellular telephone or digital television set than NASA had access to when Neil Armstrong landed on the moon in 1969. Already, computers are used in products as diverse as vehicles, surgical equipment and elevators, enabling these machines to operate more efficiently, predictably and more safely. We are beginning to see computer chips in disposable products such as packaging, as the costs continue to decline. Hitachi Ltd., a Japanese electronics maker, recently showed off radio frequency identification, or RFID, chips that are just 0.05 millimeters by 0.05 millimeters and look like bits of powder. They're thin enough to be embedded in a piece of paper, yet are able to store considerable amounts of information which can then be read and processed. Computers have become ubiquitous – they are everywhere, but we don’t consciously think of them or notice them.

The primary question that Moore’s Law should prompt in strategic planners is this: What will our industry or market be like when computers or chips are literally everywhere – in every product we make or part of every service we deliver? Some managers may think this is silly, simply because it is difficult for them to imagine a computer or chip in their product or service. Yet there are countless products or services being delivered today that have computers as an integral part that the same reasoning would have applied to just twenty years ago: Hotel doors with chips in that facilitate card access and record entry and exit; microwave ovens; and digital television. In the recent past we have witnessed the demise of the VCR, as home owners turn to hard drives to record many hours of television entertainment. An 80 gigabyte hard drive recorder costs less than USD 300. In the lifetime of most readers of this book, there was a time when the combined computer storage of most countries didn’t reach 80 gigabytes.