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2.2. Motive techno forces shaping evolution processes in ICT - Microprocessors

2.2. Motive techno forces shaping evolution processes in ICT - Microprocessors - Photonics. A. Moore’s Law

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2.2. Motive techno forces shaping evolution processes in ICT - Microprocessors

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  1. 2.2. Motive techno forces shaping evolution processes in ICT - Microprocessors - Photonics

  2. A. Moore’s Law • Gordon E. Moore, 1965. "Cramming more components onto integrated circuits," Electronics, volume 38, number 8 (19 April), at http://www.intel.com/research/silicon/moorespaper.pdf • Exponential increase in the number of components on a chip • Doubling of number of transistors on a chip every 18 months (1980s) • Doubling of microprocessor power every 18 months (1990s) • Computing power at fixed cost is doubling every 18 months(1990s) • Throughput of integrated circuits, in MIPS, will doubled every • 18 months with cost of decrease by 50%, and this regularity • will remain correct for several decades. • (MIPS -millions of instructions per second) • Reliability • Power consumption • Miniaturization (number of transistors per chip) • Terminal devices in the single chips

  3. 6 days music 4 h video 2.000.000 pages A. Moore‘s Law (Cntd) 1T 1012 256G 64G 1011 DRAMs 16G 1010 4G 1G 109 McKinley 256M 1947: 1000 MW Itanium (Merced) 64M 108 Pentium IV 16M Transistors per Chip Pentium III 107 30 min.music 4M Pentium II PPC 620 1M 106 Pentium Pro 256k Source: Siemens ICN i486 Pentium 64k 105 80386 16k 80286 8086 4k 104 1k Processors • Intel • Motorola 4004 103 1970 1980 2000 2010 2020 1990 We can store and process all information.

  4. A. Moore‘s Law (Cntd) • 1988 - 275,000 transistors on the Intel 80386 chips in to • 1992 - 1.4 million transistors on the 80486 SL chips • Pentium, Pentium Pro and Pentium II processor families • 1999 - 28 million transistors (Intel Pentium III Xeon and Mobile Pentium III processors) • 2001 - 42 million transistors (Pentium 4)

  5. Evolution of Computer Power/Cost Brainpower Equivalent (computing power of the human brain) per $ 1000 (around 2030) MIPS per $1000 (1997 Dollars) 1000 Gateway G6-200 PowerMac 8100/80 Gateway-485DX2/55 Power Tower 150e Macintosh-128K Mac II AT&T Globalyst 600 1 Commodore 64 IBM PC Apple II IBM PS/290 Sun-2 DG Eclipse CDC 7600 Sun-3 11000 DEC PDP-10 IBM 1130 VAX 11/750 IBM 7090 DEC VAX 11/780 Whirlwind DEC-KL-10 IBM 704 DG Nova UNIVAC I SDS 920 1Mio ENIAC IBM 350/75 IBM 7040 Colossus Burroughs 5000 IBM 1620 IBM 650 Burroughs Class 16 1Bio Zuse-1 IBM Tabulator Year ASCC (Mark 1) Monroe Calculator 1900 1920 1940 1960 1980 2000 2020 2040

  6. 1 chewing gum 5 Cent 2002 Prices of 1 Mbit DRAM 150 000 DM History Forecast 10 000 DM 800 DM 240 DM 1 gummi bear 1 sheet of paper 60 DM 10 DM 1 post it 1 paperclip 1 DM 26 Pfennig 3 Cent 1 Cent O,5 Cent 0,1 Cent 1973 1977 1981 1984 1987 1991 1995 1999 2005 2009 2013 2017 Source: acc. to Weick, Manfred, ZT IK MK Expensive functions and applications today will be cheap tomorrow.

  7. B. Photonic technologies • Fiber optic cables for long-haul networks – beginning of • 70-th • Main directions of FOC development: • The transition from multimode to single mode fiber • Wavelength changing of the applied spectral windows with =0,85 mkm to =1,33/1,55 mkm • The decrease of attenuation in the fiber from figures of several dozens of dB/km to 0,2 dB/km

  8. Photonic technologies (Cntd) • # Main requirements – grows of network capacity • # Boom growth of traffic, especially data • # Number of factors: • Accelerated development of the Internet • Commercial applications of graphic and video information exchange • The growth of worldwide business, which leads to the growth of worldwide traffic • # New technologies for photonic networks • SDHD/WDM • Tbits/s

  9. Performance improvements in photonics Theoretical limit of glass fiber FiberCapacity Mbit/s*km 1010 Experiment: 7 Tbit/s, 50 km Product 160x10G; 80 km 108 40´10 G +100 % p.a. 16´2.5 G 106 10 G +70 % p.a. 2.5 G 104 565 M Source: ICN M TA: Photonics 34 M 140 M 102 1975 1985 1995 2005 2015 Year

  10. 2.3. Mega trends on ICT - Digitalization - Mobile communications - Internet - Convergence of services/networks/devices - Main shifts on ICT

  11. Main shifts on ICT Packet based TODAY TOMORROW Packet based Mobile Connectionless Mobile Connectionless Telephony IP Apps Telephony IP Apps Circuit based Circuit based Connections Wireline Connections Wireline • Analog Digital Fixed Mobile Voice Data CONVERGENCE

  12. Grows of subscribers 2002: Fixed = Mobile 1,15 Billion Grows: Fixed –2%, Mobile – 10% (ITU)

  13. A. Digitalization • Digitalization of: • Information • Information processing tools • Transportation systems • Transition from analog to digital format • Analog networks - separate • Integrated networks - digital • Convergence in ICT

  14. B. Mobile communications

  15. Grows of fixed and mobile and distribution by technology

  16. Grows of fixed and mobile subscribers

  17. Ovum

  18. Limitations of 2G systems

  19. Evolution of mobile communications

  20. C. Internet • Brief History of the Internet • 1957– Launch of Sputnik is impetus for U.S. to form ARPA (DoD) • 1965 – ARPA sponsors a study “Cooperative network for • time-sharing”; Innovation of packet switching • (D. Devis, UK, P. Baran, US) • 1969 – September 2, launch of first computer network • ARPANET • 1972 – Beginning of E-mail (Tomlinson, US) • 1974 – First article about TCP/IP (Cerf/Kahn) • 1979 – Establishing first research computer network (NSF, • Univ. Wisc., DARPA)

  21. Brief History of the Internet (Cntd) • 1982 – Internet defined as TCP/IP-connected network • 1986 – 56 kb/s NSFNET created for 5 supercomputing • centers • 1989 – Number of Internet nodes breaks 100 000; IETF • comes into existence • 1992 – WWW released; Number of nodes breaks 1M • 1995 – Internet Society was founded VoIP comes to the market • 2001 – Number of hosts breaks 300M • 2002 – VoIP has taken away 13% of long-haul telephone traffic

  22. The Internet timeline Number of hosts Number of users • Reasons for grows: • Windows • Modems • Searching tools • HTL Commercial Apps Military/Academic Apps 1965 1970 1975 1980 1985 19901995 2000 2005

  23. Internet grows without any signs of recession

  24. Forecast of the global voice/data traffic’s growth Tbps 6 5 4 3 2 1 Total telephone traffic International telephone traffic Source: Arthur D. Little, 1999 Data traffic

  25. Fixed Data Services Comprise a Smaller Proportion of Income but Represent the Largest Proportion of Traffic Today´s realities European carrier’s traffic European carriers’ revenues Where traffic comes from in 2004 2004, Total USD $295 billion Other 13% 24 25 20 Fixed Data 10% Fixed telephony 39% 15 Traffic Volume (Tbps) 10 5 2 0.1 Mobile services 38% 0 Mobile Fixed telephony Fixed Data Source: Blended from IDC, ECTA, & Operators Source: IDATE, Mar 2000

  26. 100 Pbps 10 Pbps 1 Pbps 100Tbps New Measurements 10Tbps 1Tbps 100Gbps 10Gbps 1Gbps 100Mbps ARPA & NSF Data to 1996 10Mbps 1Mbps 100Kbps 10Kbps 1Kbps 100 bps 10 bps 10 bps 1970 1975 1980 1985 1990 1995 2000 2005 2010 Total U.S. Internet traffic Voice Crossover: August 2000 Projected at 4/Year 4/Year 2.8/Year Source: Roberts et al., 2001

  27. Some issues of Internet traffic • Most traffic is from corporations (80% estimated) • Main growth is from corporations • “Last mile” has been improving rapidly (100–1000 Mbps) • Corporate traffic is anti-recessionary • Move from private networks to Internet for cost reduction (VPN)

  28. Some issues of Internet traffic(Cntd) • - Corporate Internet use hit critical mass in 2000 • Now need to use the Internet for all business • Inter-corporate traffic is now mainly over the Internet • Intra-corporate traffic is growing in size (E-mail documents) - Personal traffic is growing but broadband deployment is slow - Internationally, traffic is still at the pre-2000 growth rate of 2.8/year

  29. Penetration rates of services (US market) Time to reach 50 mio customers 120 100 80 60 40 20 0 TV (15 Years) millions of customers Telephone (90 Years) Internet (<5 Years) Napster18 months Cable (10 Years) Radio (40 Years) Computer Mobile Phone 1922 1950 1980 1995 Products have an accelerated market penetration.

  30. Penetration (in %%) of different technologies and devices Mobile penetration Broadband Penetration Internet penetration PC penetration 36 50-60 40 5-10 20 40 70 << 5 17 <5 <30 <<<5 USA Europe Asia Source: Cisco, 2002

  31. Mobile vs. fixed Internet penetration in Europe Mobile and Internet penetration in Western European countries (YE 2000) 80% AUT ITA FIN NOR NL SPA SWE LUX CH 70% UK DK POR Mobile penetration (in %) 60% GRE IRL GER FRA BEL 50% 40% 0% 10% 20% 30% 40% 50% Source: Siemens (Fixed) Internet penetration (in %)

  32. D. Convergence of networks/services/devices United Network

  33. Main shifts on ICT Packet based TODAY TOMORROW Packet based Mobile Connectionless Mobile Connectionless Telephony IP Apps Telephony IP Apps Circuit based Circuit based Connections Wireline Connections Wireline • Analog Digital Fixed Mobile Voice Data CONVERGENCE

  34. Main shifts on ICT (Cntd) TODAY TOMMOROW Multifunctional devices with network interfaces Telephones, PCs, TVs Voice/data on networks Data, then MM dominates on networks Proprietary and specialized networking Totally open and interoperable networks PSTN and Internet are separated Global network of networks Dedicated applications Apps designed for universal and independent using High tariffs for long-distance service Flat networks with distance- independent tariffs

  35. 2.4. Crisis in IC sector A. Manufacturers -15% DeutscheBank and -25% CSFB # Market downturn in 2001 - Manufacturers‘ sales

  36. Turnover (Billion Euro) 2000 2001 Change compared to previous year 40 40 35 35 Nokia + 3% Siemens I and C + 8% 30 30 Alcatel - 19% 25 25 Ericsson - 15% Lucent - 22% 20 20 Cisco - 24% Nortel - 42% 15 15 10 10 Marconi - 12% 5 5 0 0 Revenue Manufacturers in 2000 and 2001 Source: CD S C

  37. EBITA (Billion Euro) 2000 2001 5 Nokia 5 1st tier 0 0 Siemens I and C Ericsson Cisco 2nd tier -5 - 5 Alcatel Marconi -10 -10 -15 -15 Lucent -20 -20 -25 -25 3rd tier Nortel -30 -30 Manufacturers EBITA in 2000 and 2001

  38. Carrier Spending, Actual Versus Normalized CapEx, Top 15 Carriers Normalized Spending $ Billion 120.0 -15% 100.0 - 23% -25% 80.0 CSFB - 6% 60.0 16% 40.0 20.0 0.0 1995 1996 1997 1998 1999 2000 2001E 2002E 2003E Source: JPMorgan Note: Source for 2001-2003 capex spending estimates is JPMorgan B. Operators Market downturn in 2001 - Carrier spending

  39. Excessive growth slowed and dropped in following three areas: • Internet • E-business • Mobile phone euphoria • The Internet boom hadn’t to pass the reality checking • E-business didn’t gain speed as quickly as anticipated. • The mobile phone euphoria came to naught

  40. Operators’ debts increase and reduce free cash flow $bn Projection Total Operators‘ net debt Europe USA Asia Pacific Source: GS II/01 Year

  41. Acquisition-mania Growth-mania C. Basis for huge losses - manias 1. Growth maniaOver a number of years, growth was the exclusive criterion for measuring success in the so-called New-Economy. 2. Acquisition maniaCompanies in particular paid outrageously overvalued prices for acquisitions. This resulted in wildly overvalued companies and share prices.

  42. Financing-mania dot.com-mania Basis for huge losses – manias(Cntd) 3. Dot.com maniaTill March 2000 we have seen a wholly irrational run-up in share prices, particularly for I and C start-ups. The successful guideline was: “Earn revenues from banners and from clicks.” 4. Financing maniaThe fourth major factor was that growth wasn’t earned, but bought. Many companies delivered products and systems to customers according to the motto “volume is everything” - without reasonably checking if they were viable or credible.

  43. Concluding remarks Global MM-MS network After 2010 all information will be digitally stored and sent via the global network.

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