Moore's Law, Metcalfe's Law, and the Theory of Optimal Interoperability
Colorado Technology Law Journal, Vol. 14, Pg. 87, 2015
17 Pages Posted: 14 Jul 2016
Date Written: 2015
Many observers attribute the Internet’s success to two principles: Moore’s Law and Metcalfe’s Law. These precepts are often cited to support claims that larger networks are inevitably more valuable and that costs in a digital environment always decrease. This Article offers both a systematic description of both laws and then challenges the conventional wisdom by exploring their conceptual limitations. It also explores how alternative mechanisms, such as gateways and competition, can permit the realization benefits typically attributed to Moore’s Law and Metcalfe’s Law without requiring increases in network size.
Keywords: Telecommunications law and policy, digital technologies, network economic effects, efficiencies, Moore’s Law, Metcalfe’s Law, economies of scale, diminishing returns, Zipf’s Law, standards, protocols, heterogeneity of consumer preference
JEL Classification: K23, L51, L96, L98, O31, O32, O38
Suggested Citation: Suggested Citation