Technology in the recession: Less is More

FOR years, the computer industry has made steady progress by following Moore’s law, derived from an observation made in 1965 by Gordon Moore, a co-founder of Intel, now the world’s biggest chipmaker. His original formulation was rather technical, and was based on the number of transistors that could be crammed onto a chip, but it was adopted as a road map by the industry, so that it became a self-fulfilling prophecy. In practice, it boils down to the following: the cost of a given amount of computing power falls by half roughly every 18 months; so the amount of computing power available at a particular price doubles over the same period.

This has resulted in a geometric increase in the processing power of desktop computers, laptops, mobile phones, and so forth. Constant improvements mean that more features can be added to these products each year without increasing the price. A desire to do ever more elaborate things with computers—in particular, to supply and consume growing volumes of information over the internet—kept people and companies upgrading. Each time they bought a new machine, it cost around the same as the previous one, but did a lot more. But now things are changing, partly because the industry is maturing, and partly because of the recession. Suddenly there is much more interest in products that apply the flip side of Moore’s law: instead of providing ever-increasing performance at a particular price, they provide a particular level of performance at an ever-lower price. …