When Gordon Moore made his prediction in a 1965 issue of Electronic Magazine(download PDF) that the number of transistors on a chip would double every year (eventually updated by Moore to two years and then updated again by Intel Corp. to 18 months), it was just a "lucky guess" based on a few points of data, he recalled in an interview in 2006. But the idea, which has grown to encompass ever cheaper, ever smaller, ever more powerful components, has so captivated the IT industry that you can't attend a technology conference without seeing at least one PowerPoint presentation displaying the Moore's Law graph.

By virtue of its ubiquity, you might think that Moore's Law actually influences technology decisions beyond the realm of chip vendors. But the truth is, few enterprise IT shops actually appear to apply it to their planning. Could this be a mistake? If you know that hardware is bound to get smaller, cheaper and faster, can you somehow put that to competitive advantage for your company? And if you ignore it, does that have untold cost?

"Almost never do people look at processor power or storage capabilities and cost trade-offs and decide, 'What does this mean to us in three to five years?'" says Thomas Moran, systems analyst principal at consulting firm Alion Science and Technology Corp. in Annapolis Junction, Md. "How does that impact our technology refresh cycle? How does it impact training and staffing?"

Moran advises state and federal agencies on risk management and disaster recovery. He believes that by applying the predictability of Moore's Law to their planning, they could better predict when it is time to move to newer technologies that would be less expensive and provide better performance. As an example, he recalls a government office that had decided to maintain legacy mainframe operations in multiple data centers. As a result, he says, operational and maintenance costs have mushroomed. "They're hostage to something that has defied Moore's Law," Moore says.

In such situations, Moran says, decision-makers forget to look at the broader picture. "It's not just that you've got more CPU cycles or storage -- it's that [Moore's Law] has enabled disciplines in other areas that impact you directly." The question his clients are constantly asking is, "What should I invest in?" Pointing to the mainframe decision, he concludes that "even safe bets often end up being problematic."

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