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Chapter 1 The Importance of MIS
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that these digital devices would change the world as they evolved and became widely used. He
formulated Bell’s Law, which states that “a new computer class forms roughly each decade
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establishing a new industry.” In other words, digital devices will evolve so quickly that they
will enable new platforms, programming environments, industries, networks, and information
systems every 10 years.
And it has happened just as Bell predicted. About every 10 years since 1970, entirely new
classes of digital devices have emerged. They have created entirely new industries, companies, and
platforms. In the 1980s, we saw the rise of the personal computer (PC) and small local networks.
In the 1990s, we saw the rise of the Internet and widespread adoption of cellular phones. In
the 2000s, we saw a push toward making all “things” network-enabled. Social networking and
cloud-based services really took off, creating a flurry of new companies.
The evolution of digital technology has fundamentally altered businesses and become a
primary driver of corporate profitability. And it will probably continue to do so for at least the next
few decades. The key to understanding how businesses will be affected by this digital evolution is
understanding the forces pushing the evolution of these new digital devices.

Evolving Capabilities

To understand the fundamental forces pushing the evolution of digital devices, let’s imagine your
body is evolving at the same rate as digital devices. Suppose you can run 8 miles per hour today.
That’s about average. Now suppose, hypothetically, that your body is changing so quickly that you
can run twice as fast every 18 months. In 18 months, you’d be able to run 16 mph. In another
18 months, you’d be at 32 mph. Then 64, 128, 256, and 512. Then, after 10 1/2 years of growth,
you’d be running 1,024 mph—on foot! How would this change your life?
Well, you’d certainly give up your car. It would be much too slow. Air travel would also prob-
ably be a thing of the past. You could start a very profitable package delivery business and quickly
corner the market. You could live outside of the city because your commute would be shorter. You’d
also need new clothes and some really tough shoes! And this is the key point—not only would you
change, but what you do and how you do it would also change. This is Bell’s Law. This same thing
is happening to digital devices.
This example may seem silly at first, but it helps you understand how exponential change
is affecting digital devices. Processing power, interconnectivity of devices, storage capacity, and
bandwidth are all increasing extremely rapidly—so rapidly that it’s changing how these devices
are used. Let’s explore some of these forces by looking at the laws that describe them.

Moore’s Law
In 1965, Gordon Moore, cofounder of Intel Corporation, stated that because of technology
improvements in electronic chip design and manufacturing, “The number of transistors per
square inch on an integrated chip doubles every 18 months.” This became known as Moore’s
Law. His statement has been commonly misunderstood to be “The speed of a computer doubles
every 18 months,” which is incorrect but captures the sense of his principle.
Because of Moore’s Law, the ratio of price to performance of computers has fallen from some-
thing like $4,000 for a standard computing device to a fraction of a penny for that same comput-
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ing device. See Figure 1-1. Increasing processing power has had a greater impact on the global
economy in the past 30 years than any other single factor. It has enabled new devices, applications,
companies, and platforms. In fact, most tech companies would not exist today if processing power
hadn’t increased exponentially.
As a future business professional, however, you needn’t care how fast of a computer your com-
pany can buy for $1,000. That’s not the point. The point is, because of Moore’s Law, the cost of
data processing is approaching zero. Current applications like new drug development, artificial
intelligence, and molecular modeling require massive amounts of processing power. Innovations