Intel founder: Silicon Valley no longer unique

Weakness of education system, high cost of living make it hard to attract top workers

The region that gave birth to such legendary high technology startups as Apple Computer, Hewlett-Packard, and Cisco Systems may be seeing some of its influence wane, Gordon Moore, one of the founders of Intel, said Wednesday.

Though Silicon Valley was once unparalleled as the natural home of high technology startups, things have changed in the nearly 40 years since Moore, along with Robert Noyce and Andy Grove founded Intel. "It's uniqueness is not as great as it was in the beginning. Other areas have picked up on the technology," Moore said of the region. "Now it's spread around to a lot of other places."

China, for example, is fast rising as a technology player, he said. "We have very formidable competition in the world. I think the impact of China is just beginning to be felt," he said. "China is training 10 times as many engineers. ... Their technology is catching up fairly rapidly. It's a very entrepreneurial society."

Chief among the challenges ahead for Silicon Valley is the relative weakness of the U.S. public education system, which Moore characterized as a problem for the entire country, and the San Francisco Bay Area's notoriously high cost of living, both which are making it harder to attract top workers. "It's so damned expensive, especially the housing. It's hard to move young people in."

The median price paid for a Bay Area home was $534,000 in January, according to real estate research firm DataQuick Information Systems.

But Moore did express a qualified faith in both the region and the country that had given birth to his company. "Silicon Valley is still a great place to start a company," he said. "I expect the U.S. will still be a successful player, but I don't think it will enjoy the position it's had in the past 20 years."

Moore's comments came Wednesday, at a press event to honor the 40th anniversary of the April 1965 Electronics magazine article that first articulated Moore's famous law on the rate of growth in the chip industry. Originally, a somewhat obscure prediction that the number of components on an integrated circuit would continue to double every year, Moore's Law has come to be regarded as an article of faith in an industry that has defined itself with rapid growth. In 1975, Moore updated his law to predict that components would double every two years.

Though he was at first embarrassed that his observation had become an industry rule -- "it was (in) a McGraw Hill publication that we described as one of the throwaway journals," he said Wednesday -- Moore eventually grew more comfortable with his status as a lawmaker. "Gradually, I got to accept it. It was shorthand for showing what the technology allowed you to do."

With the dimensions of chip components now being measured in atoms, it seems that the ability of engineers to keep doubling the number of transistors they put on chips may now be in jeopardy. But on Wednesday, Moore warned against writing off his famous maxim before its time. "I've never been able to see more than two or three (product) generations ahead without seeing something that appeared to be an impenetrable barrier there," he said.

For example, the 90 nanometer process technology commonly used by chipmakers today once seemed an impossibility, Moore said. "I remember the time that I thought 1 micron was probably going to be the limit," he said. "It wasn't a barrier at all." There are 1,000 nm in a micron, which represents one millionth of a meter.

Though Moore stopped short Wednesday of predicting that his law would hold for another 40 years, he pointed out that it has continually defied a more pessimistic maxim. "Moore's Law is a violation of Murphy's Law," he said. "Everything gets better as you make things smaller."

Copyright © 2005 IDG Communications, Inc.

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