Transcending Moore’s Law

I think this is the most important chart in technology business.

(It's an updated version of Ray Kurzweil's published work, posted with permission)

In this abstraction of Moore’s Law, Kurzweil plots computational power on a logarithmic scale, and finds a double exponential curve that holds over 100 years (a straight line would represent a geometrically compounding curve of progress).

In the modern era of accelerating change in the tech industry, it is hard to find even five-year trends with any predictive value, let alone trends that span the centuries.

Ray argues that through five paradigm shifts – such as electro-mechanical calculators and vacuum tube computers – the computational power that $1000 buys has doubled every two years. For the past 30 years, it has been doubling every year.

Each dot is the frontier of computational price performance of the day. One machine was used in the 1890 Census; one cracked the Nazi Enigma cipher in World War II; one predicted Eisenhower’s win in the 1956 Presidential election.

Each dot represents a human drama. They did not realize that they were on a predictive curve. Each dot represents an attempt to build the best computer with the tools of the day. Of course, we use these computers to make better design software and manufacturing control algorithms. And so the progress continues.

Notice that the pace of innovation is exogenous to the economy. The Great Depression and the World Wars and various recessions do not introduce a meaningful change in the long-term trajectory of Moore’s Law. Certainly, the adoption rates, revenue, profits and economic fates of the computer companies behind the various dots on the graph may go though wild oscillations, but the long-term trend emerges nevertheless.

Any one technology, such as the CMOS transistor, follows an elongated S-shaped curve of slow progress during initial development, upward progress during a rapid adoption phase, and then slower growth from market saturation over time. But a more generalized capability, such as computation, storage, or bandwidth, tends to follow a pure exponential – bridging across a variety of technologies and their cascade of S-curves.

Moore’s Law is commonly reported as a doubling of transistor density every 18 months. But this is not something the co-founder of Intel, Gordon Moore, has ever said. It is a nice blending of his two predictions; in 1965, he predicted an annual doubling of transistor counts in the most cost effective chip and revised it in 1975 to every 24 months. With a little hand waving, most reports attribute 18 months to Moore’s Law, but there is quite a bit of variability. The popular perception of Moore’s Law is that computer chips are compounding in their complexity at near constant per unit cost. This is one of the many abstractions of Moore’s Law, and it relates to the compounding of transistor density in two dimensions. Others relate to speed (the signals have less distance to travel) and computational power (speed x density).

Unless you work for a chip company and focus on fab-yield optimization, you do not care about transistor counts. Integrated circuit customers do not buy transistors. Consumers of technology purchase computational speed and data storage density. When recast in these terms, Moore’s Law is no longer a transistor-centric metric, and this abstraction allows for longer-term analysis.

What Moore observed in the belly of the early IC industry was a derivative metric, a refracted signal, from the bigger trend, the trend that begs various philosophical questions and predicts mind-bending futures.

Moore’s Law is a primary driver of disruptive innovation, such as the iPod usurping the Sony Walkman franchise , and it drives not only IT and Communications and has become the primary driver in drug discovery and bioinformatics, medical imaging and diagnostics. As Moore’s Law crosses critical thresholds, a formerly lab science of trial and error experimentation becomes a simulation science and the pace of progress accelerates dramatically, creating opportunities for new entrants in new industries.

This non-linear pace of progress has been the primary juggernaut of perpetual market disruption, spawning wave after wave of opportunities for new companies.

I just watched Transcendent Man, so I have Kurzweil on the mind.