50 years after Moore’s Law, powerful computer processing now cheaper than ever

quality-efficiency-speed-costAt some point over the past decade, computers became really cheap to own. Make no mistake, it is still very easy to spend a couple thousand dollars on an iMac or another high-end model that can handle high quality image processing and other heavy duty computing work. However, it’s easier than ever before to obtain a working computer for $200 or even less and a big part of the reason why this happens just had a major anniversary.

On April 19th, 1965, an issue of Electronics was published including an article penned by then-director of research and development at Fairchild Semiconductor, Gordon E. Moore. The article, entitled Cramming more components onto integrated circuits, posited that the most cost-effective integrated circuits would increase from 50 components per circuit to 65,000 components per circuit by 1975. The idea that the density of components on a single integrated circuit would double every one to two years is the basis of Moore’s Law, which although not a physical or natural law is an observation on the tech industry which has been practical over time. Today, there are computer chips which hold 8 billion transistors according to NPR. Scientists at Intel, the tech company founded by Gordon Moore, believe that the pace of Moore’s Law is sustainable for another 10 years.

It’s amazing to think where that will put us considering the 10 years we’ve just experienced during which the smartphone revolution put a working computer into just about everyone’s pocket. We took some time last November to profile brief histories of both the Android mobile operating system marketed by Google and the iPhone/iPad mobile devices developed by Apple. Hundreds of millions of either of those units have been sold and each generation has more computing power for about the same price as the previous generation. As one educational text on Moore’s Law points out, the original iPod cost $399 and held 1,000 songs but five years later, Apple was selling an iPod that was $50 cheaper and held forty times the number of songs. Computing gets faster and cheaper with time to the delight of consumers everywhere.

Back up a little further, compare personal computers from today against their desktop counterparts from the 1980s and the results are truly shocking. The MITS Altair 8800 released in 1975 cost about as much as the 2009 Dell Precision T7400; the Altair’s $495 retail price would increase to $1,987.08 when adjusted for inflation, about $12 less than the Dell Precision’s $1,999 price tag. That’s pretty baffling to consider when you realize that the two computer systems are almost incomparable in terms of random access memory, or RAM (0.256 kilobytes [KB] vs. 4 gigabytes [GB]), processing power (2 megahertz [MHz] vs. 9,320 MHz) and hard drive space (0 megabytes [MB] vs. 80GB).


Just a head-on comparison of two Apple products separated by time provides a perfect example of Moore’s Law in action. In 1984, Apple released the Macintosh personal computer at a retail price of $2,495. The Apple iMac released in 2009, just 15 years later, cost a total of $3,849. Technically that’s a price increase, but when we again adjust for inflation, it turns out that the Apple Macintosh would have cost a whopping $5,186.17 per unit in 2009. That makes the iMac 26 percent cheaper than the Macintosh, according to Encyclopedia Britannica. Processing power cost much more for the Macintosh ($662.35 per MHz vs. $0.34 per MHz); RAM did as well ($40.52 per KB vs. $0.00025). The cost savings for consumer computing technologies that we’ve seen over the years are almost mind-blowing.

We can get another perspective of the progress of Moore’s Law if we take the low-end computing products being marketed today into account. It will be important to remember that even these low priced options will have a computing power which is exponentially greater than the earliest personal computers from the 1980s. For example, the Acer Chromebook 15 CB3-531 comes with a dual-core Intel Celeron N2830 processor which can operate at processing speeds up to 2.41 GHz, more than 300 times greater than the 7.83 MHz processing power of the 1984 Apple Macintosh. In terms of RAM, Acer’s new Chromebook provides 2GB of memory while the Macintosh only supported 128KB, which means that Acer’s product runs about 15,625 times faster than the Macintosh. Comparisons of just about every other computing specification between the two machines are just as difficult to effectively visualize. When adjusting for inflation going back to 1984, the year that Apple’s Macintosh was released, today’s $199 Acer Chromebook would cost $88.09, a total which is only about 3.52 percent of the Macintosh’s 1984 retail price.

The Acer Chromebook is a personal computing product which comes with a keyboard and touchpad for inputs and a screen to output a display to a user. This product may be the cheapest one on the market which comes standard with those peripherals but adventurous computing enthusiasts can find PC options which are even cheaper. The development of the HDMI data transmission standard enables the Intel Compute Stick, a $149 processor fitting in the palm of a person’s hand, to turn any HDMI-enabled display screen into a computer running Windows 8.1. Google plans on unveiling a similar stick computer, the Chromebit, with a $100 price tag. Perhaps the cheapest personal computing product available today is Raspberry Pi, a computer shaped like a credit card, albeit thicker, and designed to cost £25, or $38.56 USD. It comes with ports with connections to peripheral equipment like a monitor display, mouse and keyboard and has been developed with an eye towards teaching children about computer programming. It is not incredibly powerful but it can handle an array of basic tasks, from document creation to playing video games.

A consumer price index chart published by emerging technology publication Gigaom clearly shows that the price index of personal computing has dropped by greater than 40 percent since 2007; during that time, the average consumer price index rose by about 10 percent. Computer software and wireless telephone technologies have also seen price index reductions. although theirs are much less substantial.

Interestingly, the only area of tech related to the digital age where the price index hasn’t fallen in those years is Internet bandwidth provided by Internet service providers. An official from the Technology Policy Institute interviewed for the Gigaom story spoke to the idea that high, fixed prices for broadband could be a result of reduced competition among ISPs. As we’ve noted elsewhere here on IPWatchdog, the net neutrality rules which sent millions of public comments to the Federal Communications Commission effectively slow innovation in the sector and quash any hope that we might enjoy cheaper Internet access any day soon. Broadband might want to be as cheap as computing, if we’ll let it, and that would allow better access to even more people.

The Author

Steve Brachmann

Steve Brachmann is a freelance journalist located in Buffalo, New York. He has worked professionally as a freelancer for more than a decade. He writes about technology and innovation. His work has been published by The Buffalo News, The Hamburg Sun, USAToday.com, Chron.com, Motley Fool and OpenLettersMonthly.com. Steve also provides website copy and documents for various business clients and is available for research projects and freelance work.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author as of the time of publication and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

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