Many of the numerous articles celebrating the 50th anniversary of Moore’s Law have again raised the question of when will it run its course. Are the steady advance of computing power and the reduction in its cost, predicted by Gordon Moore in 1965, going to finally be stopped by the laws of physics and the insurmountable limits of miniaturization?
I would argue that Moore’s Law is not about physics, not even about economics. And it is much more than a self-fulfilling prophecy guiding an industry as it is generally perceived to be. Rather, Moore’s Law is a marketing slogan promoting a set of specific innovations and the embodiment of a specific set of social norms guiding an economic activity. It’s the call-to-arms of an American entrepreneur, selling his ambition, risk-taking, and unshaken belief in himself, his colleagues, and the unlimited opportunities offered by his country.
I predict that Moore’s Law will endure as long as the American entrepreneurial spirit will endure.
Predictions regarding the end of the remarkable prediction Gordon Moore made in 1965—and its subsequent realization by the semiconductor industry—typically revolve around questions of physics. For example, Re/Code’s Arik Hesseldahl writes that “A lot of people who know about these things have predicted [that in 2022] Moore’s Law will reach its logical end.” But he also dutifully links to his 2005 prediction—”I’m willing to bet that by the time Moore’s Law turns 50, it will be nothing but a memory” —and points to new materials and new lithography technology as potential solutions.
Michael Kanellos says that “you can only shrink things so far” but points out that it doesn’t mean the tech industry will hit a wall and that the salvation could come from chips with 3D transistors. Chris Mack says in IEEE Spectrum that “I’ve been known for making grand pronouncements at lithography conferences about the coming end of Moore’s Law” but points out the exciting possibilities of integrating even more functions on a single chip, directly connecting digital CMOS chips with the analog world (an early example is your cellphone camera).
The physics are fascinating and the possibilities for new inventions driven by the desire to extend the life of Moore’s Law are seemingly endless. The focus on the mechanics of implementing Moore’s prediction, however, may account for the failed predictions of its eventual demise. Going beyond physics to view Moore’s prediction in the context in which it was first stated and later popularized, may help us understand better what it stands for and if and when it will meet its end.
Many commentators have made the point that Moore’s Law is not a law of physics and many have pointed out that it’s mostly about economics. Carver Mead, the Caltech professor who dubbed Moore’s prediction “Moore’s Law,” is one of the few that goes even further, saying that “Moore’s Law is not a law of physics, it’s a law of human nature,” according to Robert Hof’s account of a Computer History Museum event last month.
I’m assuming that by “human nature,” Mead meant the remarkable human ingenuity that has sustained the prediction for 50 years. But this has been a very specific flavor of human ingenuity, nurtured in a long tradition of which Moore’s Law (and the technological progress it represents) is but one of many other remarkable milestones. It’s the tradition of the American entrepreneurial spirit, the tradition that gave rise to Silicon Valley—and the entrepreneurial Gordon Moore who co-founded Fairchild Semiconductor in 1957 and Intel in 1968—In Northern California.
Here’s a telling excerpt from an interview of Gordon Moore and Arthur Rock, the venture capitalist who was the first to invest in Intel, by John C. Hollar and Douglas Fairbairn, published in a special issue of Core, the Computer History Museum’s publication:
Hollar: Was it an intimidating idea to think that the two of you would leave Fairchild?
Moore: Not especially. We belonged to the culture of the Valley that failure is something that, if it happens to occur, you can start all over again. There’s no stigma attached to being a failure. And we had had enough success at Fairchild. We were reasonably confident we knew what we were doing.
Hollar: There was a famous one page proposal, wasn’t there?—that was drafted to explain what the nature—
Rock: It was three pages, doublespaced. Some of the investors wanted to have something in their files. So I wrote this three-page double-spaced memo. It didn’t say anything.
Moore: I didn’t realize you had written it. I thought Bob [Noyce, Intel’s co-founder] did.
Rock: No, I did. I think Bob would have been more specific.
Moore: Probably. It was rather nebulous what we were gonna do.
Fairbairn: Did you have a specific product in mind?
Moore: Well, semiconductor memory. And we went after that with three different technological approaches. I refer to it now as our “Goldilocks Strategy.” But one of them, by fortune and accident, was just difficult enough. When we were focusing on it, we could get by the two or three rather serious problems that had to be solved. But we ended up, then, with a monopoly of about seven years before anybody else got over on the silicon gate mos [metal oxide semiconductor] transistor structure that we were using. So it really worked out beautifully. Luck plays a significant role in these things. It was just a very lucky choice.
Everything we associate with today’s Silicon Valley was already there: No stigma attached to failure, audacious risk taking, willing investors, creating (temporary) monopolies, and lots of luck. Arthur Rock was a personal friend (another attribute of today’s Silicon Valley) but he also convinced others, with his 3-page memo, to invest in the “nebulous” idea of the two entrepreneurs. Moore’s article and prediction, published three years earlier, probably also helped convince the other investors that they are betting their money on a technology with a guaranteed exponential future.
It was a very specific prediction, couched in quantitative, “scientific” terms, with the convincing appearance of a law of nature. There was no better way to sell a new industry to a bunch of fellows with money who were themselves creating a new industry, the venture capital industry. And there was competition for the funds provided by the nascent VC industry: Some twenty-six new semiconductor firms were established between 1967 and 1970, observes George Gilder in Microcosm.
More important than the VCs, however, were the potential customers for Moore’s and Noyce’s (and a few other tinkerers’) innovations, at Fairchild and Intel. Moore’s 1965 article was written earlier as “an internal document titled ‘The Future of Integrated Electronics’ to encourage his company’s customers to adopt the most advanced technology in their new computer designs.”
In Understanding Moore’s Law, David C. Brock writes: “While the market for silicon integrated circuits was growing in the early 1960s, Moore and others in the semiconductor industry experienced customer resistance to and skepticism of the new microchips… In addition to advancing the new technology itself, Moore was getting his message across to potential customers and the semiconductor industry. Finally in early 1965 came the opportunity to publicize and advance the cause.”
Moore told Jeffrey Zygmont in 2001: “When we tried to sell these things, we did not run into a receptive audience.” Writes Zygmont: “Because at least one of the eight transistors on Fairchild’s early Micrologic chips were bound to fail, critics chided that only 0.18 percent of the ICs would work. That amounted to one good chip out of every ten million or so produced…. [by 1965], under assault by competing approaches to circuit miniaturization, feeling their product poorly appreciated, IC advocates felt a competitive urgency to popularize the concept. Therefore they proselytized… [Moore’s] prophecy was desperate propaganda.” And Brock again: “The immediate context of Moore’s 1965 publication was a broad effort by semiconductor industry leaders to convince others that the future of electronics lay in integrated circuits… this brief article would be an excellent opportunity for Moore to convey his vision of the future for integrated circuits—a technology his firm had pioneered and a market in which it was a strong leader.”
One of the industry leaders proselytizing, for example, was C. Harry Knowles, manager of Westinghouse’s molecular electronics division, who wrote in June 1964 in IEEE Spectrum: “Speed has doubled every year over the past seven years on average.” Moore did not “discover” his law, as many commentators write. Moore brilliantly came up with the best formulation of a marketing slogan.
Like other marketing slogans—and unlike the laws of physics—Moore’s Law was revised to fit with the times. In a 2006 article (subscription required) in the IEEE Annuals of the History of Computing, Ethan Mollick has convincingly showed that the “law” and the prediction were adjusted periodically in response to changing competitive conditions (e.g., the rise of the Japanese semiconductor industry): “The semiconductor industry has undergone dramatic transformations over the past 40 years, rendering irrelevant many of the original assumptions embodied in Moore’s Law. These changes in the nature of the industry have coincided with periodic revisions of the law, so that when the semiconductor market evolved, the law evolved with it.”
Moore’s Law is the most widely known example we have of the ability of successful entrepreneurs to articulate a compelling vision that motivates investors, employees, and customers to join forces with them. Another illustration of the power of a great tag line that looks and sounds like a law of nature, is what has been popularized (by George Gilder) in the 1990s as “Metcalfe’s Law.”
In 1983, 3Com’s co-founder Bob Metcalfe answered his sales force’s need to convince customers that they should buy additional $1,000 Ethernet cards by devising a mathematical formulation, claiming that the value of a network is proportional to the square of the number of “compatibly communicating devices.” Metcalfe says that he used his law-like formulation to “convince early Ethernet adopters to try LANs [Local Area Networks] large enough to exhibit network effects,” in effect promising them that the value of their investment will grow as more people get connected to the office network.
Metcalfe Law encapsulates a brilliant marketing concept, engineered to get early adopters—and more important, their accountants—over the difficulty of calculating the ROI for a new, expensive, unproven technology. It provided the ultimate promise: This technology gets more “valuable” the more you invest in it.
Moore’s and Metcalfe’s “laws” are two prominent examples of the remarkable marriage of engineering and marketing ingenuity that has made so many American entrepreneurs successful. But why American? Why does this country have a higher concentration of successful—and unsuccessful—entrepreneurs than any other country?
The answer is that when everybody is equal to everybody else—or when this is the ideal that a society aspires to—people with a certain type of personality find it unacceptable not to be on top, not to “succeed,” not to “do better” than their friends and relations, and especially, better than their competitors. More often than not, they find it unacceptable to “work for somebody else.”
Moore and Noyce left Shockley Semiconductor Laboratory with six other employees to co-found Fairchild Semiconductor because they were unhappy with their boss, William Shockley. More important, the decision (by Noyce) to leave Fairchild and co-found Intel with Moore came when Noyce was passed over for the top job. The third employee at Intel was Andy Grove, who years later would serve as mentor for a rising Intel executive, Dick Egan.
43-year-old Egan co-founded EMC Corporation in 1979 with his college roommate, Roger Marino, also a senior high-tech executive at the time. Unlike Noyce and Moore, they did note even have a “nebulous idea” for a product, so they sold furniture for the first six months. Twenty years later, I asked Egan why he abandoned a promising and successful career without even having a product idea to drive him to take the risk and start a new company.
“We felt that we could do it because we had worked with a lot of people that had started companies,” Dick Egan responded. “And we felt that we were as capable as they were. But we didn’t have an invention or a product idea or a market concept. That is, a market that needed a product or service. But we wanted to start our own company.”
Egan and Marino wanted to start their own company because they felt “as capable” as the people who were their bosses. When I came home from the interview, I related this story about Egan’s entrepreneurial motivation to my wife, Liah Greenfeld. The next day, she shared it with her class as an example of what they were reading about the United States in the draft of the book she was writing at the time, on the cultural bases of economic growth.
In The Spirit of Capitalism: Nationalism and Economic Growth, Liah wrote about equality as the supreme national ideal in America and what drives its entrepreneurs: “Theoretically, [in America] one was equal to all other members of society and measured oneself against them. In practice, this implied desire for parity only with those who were ‘more equal’ than the others and, as a result, a constant race, justified and spurred on by the supreme national ideal, for social superiority. In the economic sphere… this meant continuous competition for profits, continuous search for new ways to make them, and thus continuous stimulus for diversification, technological and organizational innovation, and growth. One was as good as anyone else, but there always was somebody who was doing better. This deprived the ambitious man of sleep.”
When they were not sleeping, they dreamed up new inventions and how to sell them to eager customers. Their domestic customers were not necessarily entrepreneurs like them but they were also infected with the spirit of unlimited possibilities, with the unshakable belief in steady progress and “only in America.” I saw it first-hand in high-tech—the people working for American corporations willing to bet on unproven technology, on the imagination and ambition of a Moore, or a Metcalfe, or an Egan, building their careers by taking risks and buying a “disruptive” technology.
It so happened that Moore’s 1965 article was published on April 19, 1965, the 190th anniversary of the battle of Lexington and Concord, the start of the American Revolution. The rebels fought for respect from their “bosses” overseas and were already driven in their economic pursuits by the desire to outrank their neighbors. Historians Oscar and Mary Handlin: “Everyone dabbled in a variety of ventures, trading, lending, going on shares with partners in mills, forges, glass-, candle-, and brickmaking, all on the chance of some greater gain. The speculative use of capital was the prevailing feature of colonial life.”
Unlike the transistors following Moore’s Law, the economic effects of the spirit of American enterprise don’t predictably double every year or two. The American economy goes up and down, it enjoys a bubble and then suffers a crash. What was called a “delirium of speculation,” was termed by Alan Greenspan more than 200 years later an “irrational exuberance” in the midst of yet another spurt of growth, this one driven by the economic sector Moore and his colleagues and competitors helped establish, adding to the size of the largest economy in the world.
President Obama was more eloquent than Greenspan in his first inaugural address, in the midst of yet another economic downturn (largely caused by speculators equipped with computers and promoting the new “risk management revolution”):
In reaffirming the greatness of our nation we understand that greatness is never a given. It must be earned. Our journey has never been one of short-cuts or settling for less. It has not been the path for the faint-hearted, for those that prefer leisure over work, or seek only the pleasures of riches and fame. Rather, it has been the risk-takers, the doers, the makers of things—some celebrated, but more often men and women obscure in their labor—who have carried us up the long rugged path towards prosperity and freedom.
Indeed, we cannot take as a given that the risk-takers and doers, the peculiar American brand of engineers turned marketers, will go on to be driven by the spirit of American entrepreneurship. Or that their willing customers will continue to take risks and invest in “revolutionary” and “disruptive” technologies because this is the American thing to do. We may assume, however, that they will all go on taking risks as long as what motivates them to take risks is still around in full force.
To quote Greenfeld again: “The trend of economic growth in the United States is not likely to be significantly affected even by the cooling of the national sentiment and the loss of interest in international competition… so long as Americans feel compelled to ‘keep up with the Joneses’—so long, that is, as the nationalist ideal of equality spurs them on in their constant competition for individual status.”
Moore’s Law is probably the best contemporary embodiment of the American entrepreneurial spirit. It may meet its end when (and if) the American entrepreneurial spirit dies down, no longer driving the race to find ways to extend its life and driving new American entrepreneurs to follow the footsteps of Moore, Metcalfe, and Egan. And it may not disappear but decrease in strength in relative terms, overshadowed by a new–and different–entrepreneurial spirit emerging in full force today in India and China (as it did in Japan but with much more limited resources at its disposal).
Let me know in comments what do you think about the prospects for the continuing strength of the American entrepreneurial spirit.
Originally published on Forbes.com