For 40-plus years, the semiconductor industry has religiously followed Moore's Law. This notion, first propagated by Intel (NASDAQ:INTC) co-founder Gordon Moore, states that roughly every two years integrated circuits will double in both transistor capacity and speed. The result of this extraordinary technological feat has been the creation of everything from wickedly powerful $500 laptop computers to $79 cell phones that possess the capacity to make phone calls, snap pictures, and stream videos.
Intel, Advanced Micro Devices (NYSE:AMD), and others are relatively confident that they will be able to continue to abide by this "law" for at least another decade or so and, as such, keep a variety of electronic manufacturers delivering an assortment of new products that are better, faster, and cheaper.
Doing so, however, is neither easy nor cheap. In addition to requiring the construction of the very expensive multi-billion dollar fabrication facilities that are needed to build these next-generation semiconductors, these smaller and faster chips also create big problems in terms of both the amount of heat they generate and the quantity of energy they are consuming.
Hewlett-Packard (NYSE:HPQ) researchers are publishing an article in the journal Nanotechnology next week that demonstrates that they can, in theory, reconfigure computer chips so that eight times as many transistors can be placed on each computer chip. News of this article is generating a great deal of interest in the industry.
By creating a grid of tiny nanowires that chip designers can place on top of circuits -- as opposed to the current technology which requires the aluminum wire interconnects to be placed inside the chips -- the researchers have found an innovative way to free up a massive amount of room on each chip. Because this additional space is no longer being clogged by the relatively bulky interconnects, it can now be populated with more transistors.
The new design, which HP believes could be on the market as early as 2010, is noteworthy for a number of reasons. First, because so many transistors can now be placed on each chip, it is possible that certain functions of the chip can be idled when not in use. Such a feature will dramatically cut down on energy consumption.
Second, the large increase in transistors will allow chip designers to build redundancy into each chip. What this means is that if a single transistor fails, rather than having to disregard the entire chip, the chip can keep operating by simply rerouting instructions around the faulty transistor.
Third, and perhaps most significantly, this new design can be manufactured using existing facilities. Translation: semiconductor manufacturers won't have to cough up billions of dollars to build new facilities for quite some time.
All of these advantages suggest that HP -- which is no longer in the chip-making business -- might soon be capable of garnering huge royalties from companies looking to license this technology. To the extent that it does, it could also serve up some very healthy profits for long-term investors.
Interested in other nanotech Foolishness? Check out these articles:
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Fool contributor Jack Uldrich is the author of two books on nanotechnology, including Investing in Nanotechnology: Think Small, Win Big. He owns stock in Harris & Harris and Intel. The Fool has a strict disclosure policy.
