e-business basics - Moore's Law

Moore’s Law is based on an observation originally made by Gordon Moore, a co-founder of Intel. He noted that the number of transistors that could be fitted on an integrated circuit doubled approximately every two years. More recently, this phenomenon has been observed in a number of fields related to eCommerce that;

The power (or capacity, or speed) of the following that can be bought for a given sum doubles approximately every 18 months:

1. Computer Processor speed
2. Telecommunications bandwidth
3. Computer memory
4. Hard disk storage

As with Metcalfe’s Law, this is really a rule of thumb and the exact period of time is much less important than the general principle, which is that many of the core technologies that form the bedrock of the Internet and of eCommerce, continue to advance at a steady rate.

Firms that sell products and services that rely on on-line devices should consider the speed and capacity available for on-line services not just as they are now, but as they will be in what is quite a short time span.

This would provide useful input into a PEST analysis or similar, so that, for example an on-line retailer ought to be considering the capacity of mobile telephones to carry out Ebusiness transactions.

Furthermore, this tends to be a self-fulfilling prophecy of device obsolescence that computers and other related devices become obsolete quickly as they are unable to keep up with applications.

Author: Steve Whiteley, January 2007