Prof. Jürgen Plate
Moore's Law and Metcalfe's Law
Gordon Moore, founder of Intel Corporation, based his business on the
law that he enunciated. Moore's Law states that every 18 months,
processing power doubles while cost holds constant.
Moore's insight proved prescient. His law has been true through the
years, and it appears that it will remain true for the foreseeable
future. Telecommunications bandwidth and computer memory and storage
capacity are experiencing a similar fate. This makes it very affordable
for individuals and small businesses to be equipped with the electronic
means to conduct commerce and transfer information as fast and freely
as large corporations can.
Robert Metcalfe, founder of 3Com Corporation and designer of the
Ethernet protocol for computer networks, states that the
usefulness, or utility, of a network equals the square of the
number of users.
The telephone is of very limited use if only you and your best friend
have one. If a whole town is on the system, it becomes much more
useful. If the whole world is wired, the utility of the system is
phenomenal. But in the predigital age, it could take many years for
Metcalfe's Law to bear fruit. It was not until 1931 that telephone
companies put a dial on the instrument, finally cutting the tremendous
cost of employing switchboard operators and extending the reach of the
system. First, telephone use had to reach a critical mass, or number,
of users. So it is with any technology.
Until a critical mass of users is reached, a change in technology only
affects the technology. But once critical mass is attained, social,
political, and economic systems change.