The Cell Chip - how will MS and Intel face the music?
Part II: Place your bets
My business cycle, your aura
About 30 years ago Asian manufacturers began to imitate Western technology such as automobiles and mainframe computers very successfully. In many cases, customers were far happier with the Asian imitations than the Western originals, which were soon shown to be more expensive and less reliable than the upstarts. Buyers were prepared to put up with human interface eccentricities - such as un-programmable VCRs and DVD remotes with gazillions of redundant, but identically-sized buttons - because it was worth it. (Mass market Asian design is truly awful - remote controls look like a crocodile's back: the 'Play' button is exactly the same size as 247 other buttons competing for your attention, some of which perform arcane functions we can only guess at - perhaps as "2.5x playback" and "pan". Nonetheless, these rule the market - which puts human interface design in a depressing context. It doesn't seem to matter).
Shortly after this splurge of cheap imports made the game clear, the people who fund technology development in the West decided to place a few strategic bets. With higher labor costs, and the R&D burden, the West couldn't compete with Asian manufacturers. It focused on materials innovation (which is where Intel really leads, with its incredible process technology) and on companies who obediently squeeze cost out of their businesses, by making computing products as cheap as possible. The East would be permitted to manufacture the goods, while the West would retain leads in semiconductor technology and system software.
The result of this is today's PC industry, the horizontal Dell model, and it's one where nothing quite works as it should, and no vendor really has any idea what people do with their computer products.
(By the by, you can begin to see Linux has such appeal to Asian manufacturers. It's not because it's particularly good - it's not. In computer science research it's Stone Age technology. But that doesn't matter. It's good enough to a systems builder - for whom a great big zero point zero-zero has suddenly, and quite magically, appeared on his bill of materials spreadsheet.)
Then, while Asian manufacturers concentrated on building real things that people want to use, Western "information technology" went off on a strange pursuit of quite irrelevant abstractions, such as the "internet", "push", "search", and any buzzword containing the word "multimedia" or "information".
But people have little patience for abstractions - they simply want to see a movie, share a tune, check their bank account, or get money out, or talk to an aunt. None of these fantastic, abstract brainfarts of the PC-era or the "Internet-age" really helped people very much: because they weren't ends in themselves, but rather ill-thought-out means to an end. Along the way, we saw a huge, incontinent explosion of investment capital in these abstractions, a bubble generated by a few selfish people who thought they could overlay the mother of all abstractions, the word "market" on top of these other abstractions. This ended, fairly predictably, in tears, but the desire to make money from abstractions-squared hasn't gone away, and will crop up again in this story, and we mention it here with a purpose.
We all know what happened. Once we exclude the quadopoly of services companies who lucked it out (Google, eBay/Paypal, Amazon and Yahoo!) after the bubble burst, we see that things are pretty much exactly where they were in 1995.
In addition, Intel's process lead has been cut from three to five years, down to a few months at most. Cell is a rare example of IBM breaking the Western concensus, and pooling its own semiconductor expertise into a global project. There is no Western "lead" in semiconductor technology anymore. Advanced microprocessors can, and are being developed on the most sophisticated process technology, without regard to any Wintel duopoly. In volume too. All of which means that this era of self-deception, a hegemony fueled in the popular media by so many fictions, is probably over for good, now. And no American or European technology company has conquered the living room, or really made itself pervasive in any aspect of our lives except ... in computing itself. And what use is that?
And now, rather brazenly, comes Cell.
Next page: Meet the utility company