Posts Tagged ‘End of Moore’s Law’

In the early, exciting days of the PC era – when our firm was getting started — the pace of growth in technology was largely driven by the now famous “Moore’s Law” named after Intel co-founder Gordon Moore, who noted that the power of the PC’s main processor doubled roughly every two years.  That law has governed pretty much the entire computer realm for nearly 50 years.

But no more.  Or should we say, no Moore.

The physical limitations of electrons and heat in confined spaces are bringing this biannual doubling of capacity close to its predictable end.  Moreover, designing chips significantly faster today requires a different sort of Moore-doubling – as in doubling (or more) the cost of the chip fab plants that make them, which are now in the $10 billion plus range.  As a result, there are few competitors remaining, even as the market for chips rose by more than 20% in 2017 alone.

As tempers fray between the U.S. and China and the physics of the matter intervene, the future of the industry looks increasingly messier – and thus ripe for all manner of competition, collapse and new innovations.

China, which does have the money to compete, is on a global quest for technological supremacy by 2025 in national push, and has long been a voracious consumer of American technology, which has often been given up freely American by firms as a right to compete there.  But we’re not here to argue politics, trade wars notwithstanding.

This is a complex supply chain starting with the purest of silicon dioxide mined from the Appalachian Mountains and shipped to Japan to be turned into pure silicon ingots.  These are then sliced into wafers in Taiwan or South Korea and imprinted meticulously with equipment made in the Netherlands.  The design pattern might come from ARM or Intel or one of a handful of other chip designers, and it’s all eventually packaged into ceramic containers that populate any chip board out there today, to be tested in China or Vietnam or the Philippines.  The resulting circuit board arrives in Mexico or Germany or China for assembly into a robot or a PC or a cloud server.

One edge that the West, in particular the U.S., holds is that the semiconductor industry relies greatly on what one industry expert calls “repetitive cycles of learning,” ensuring higher barriers to entry for those without deep prior experience and knowledge.  So it gets harder.  Then again, the effect of something called Dennard scaling has meant that shrinking components tend to offer fewer and fewer benefits in chip making over successive generations.  Thus, being a few steps behind the industry leaders may not matter so much.

But with the demise of Moore’s law, for perhaps the first time in decades, there opens a whole new competitive opportunity.

Quantum computing, which relies on principles of physics that exist at the atomic level, afford the opportunity to think in entirely new ways about how we make the next generation(s) of computers.

Quantum can speed up some calculations immensely, even if at the expense of doing so a bit less accurately.  Still, this may hold computational benefits in many fields where absolute calculation perfection is not required.  Google, IBM, Microsoft and others have quantum-computing projects they’re working on right now.  Here again though, China is making big bets, the technology is nascent and not yet fully practicable, and the winners of the future are unclear.

What is clear is that the Moore’s Law that governed the growth of our industry when we started in the 1980s is destined to be something altogether different to the next generation of computing pioneers.

We wish them the best of luck.

Read Full Post »