Friday, December 09, 2005

Chip sales on upswing | CNET

Can there be any doubt that chip sales are on the upswing? When I look at all the new services being offered by Yahoo, Google, MSN, AOL, and APPL, to name a few, I can't see how one would not expect high chip sales growth.

When Google Analytics was rolled out as a beta program, Google was overwhelmed by the response. Google probably has 200,000 computers but not enough. Moore?s law continues to work but the situation is a bit like electricity at the turn of the 19th century; electricity was more efficient by orders of magnitude. As a result, we think nothing of leaving a 100 watt bulb burning for hours on end today. This same amount of lighting 100 years ago would have cost us almost a days pay.

Today, Google, Yahoo, and the rest of the usual suspects are providing services so cheaply that they can give much of it away in exchange for advertising revenues. I have asked this question before but it is worth asking again, where does the demand curve cross the supply curve when the service is in great demand but is free?

The internet is quickly catching up with its capacity. Chips are getting ready to sale like hot cakes on Fat Tuesday!