Moore's Law less relevant in connected era

Kevin Noonan/Ovum
11 Dec 2012

For almost 50 years, Moore’s Law has had a significant influence on the IT industry. In a fast-changing world, it has continued to be a reliable industry rule of thumb; it has guided the plans of commentators and strategists, predicting how technology will inexorably become smaller, cheaper, faster, and more commoditized.

However, the world has become a more complex and interconnected place. Today, accessibility and interconnectedness are driving value through increased productivity and innovation. If too much focus is placed on Moore’s Law based on price and performance, there is a significant risk of overemphasizing the potential for commodity cost savings from IT, while missing out on the much bigger opportunities in an interconnected world.

Moore’s Law is still important

Moore’s Law is named after Intel co-founder Gordon Moore. In a 1965 paper, Moore noted that the density of IT circuitry roughly doubled each year, and predicted that this trend would continue. In the 1970s, it was updated to once every two years, but the basic theory has remained unchanged.

The density of circuitry is, of course, a big driver of the size and cost of technology.

Over the years, Moore’s Law has been surprisingly accurate. This is due in part to the semiconductor industry itself using Moore’s Law as a guide for its long-term planning, for setting research and development targets, and for driving market expectations. In a sense, Moore’s Law has become a self-fulfilling prophecy, where the theory is actually driving reality.

Problems with a doctrine based only on price and performance

In a sense, Moore’s Law is a victim of its own success. Extrapolations of faster, cheaper, and smaller computing have sometimes led to a commodity cost-cutting doctrine that ignores other important factors. In a much-quoted 2003 article in Harvard Business Review, “IT doesn’t matter,” Nicolas Carr referenced Moore’s Law in his argument that IT had become a commodity that was inconsequential to strategy.

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