Moore’s law has held sway in the chip industry for five decades but that era is now over, according to GlobalData, a leading data and analytics company.

The company’s latest report, ‘AI chips’ says the end of the convention, which has governed industry thinking around the performance capabilities of silicon chips since the 1970s, will drive a change of direction for the entire sector.

Ed Thomas, Principal Analyst for Technology Thematic Research, commented: “Instead of the single-minded, ‘double everything’ approach, chip designs are becoming more sophisticated and complex. We are entering a new era of microprocessor design which will lead to new chip architectures, new classes of chips, new business models, new alliances, new materials, and radical decisions about who does what in terms of design and manufacture.

“This transition away from traditional approaches will lead to turmoil in the $500bn chip sector, bringing pain to incumbents, but offering opportunities for newcomers within the next two to three years.”

Rather than simply doubling the power of microprocessors, manufacturers will have to find ways to make them smarter, so the emphasis in chip design has shifted from a race to place more transistors onto a square millimeter of silicon, to a focus on building microprocessors as systems made up of multiple components, each of which is designed to perform a specialized task.

The report identifies the winners in each of the chip categories that will benefit from a boom in the use of artificial intelligence (AI).

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