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Moore's Law does eventually run out, some think around 2020 when we get down to using atoms (not that progress will stop just slow down). there is a limit to how small we can go and when we get there the competitive edge will start to disapear. And with no fear of the hardware expiring so quick software will become the important difference.

But as that article points out, this is assuming there's no advancement beyond integrated circuit technology before that happens. There are a number of technologies in the works that could get us over the hump and well beyond.