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1 Digital Economy Digital Economy Driving Factors & Competition Driving Factors & Competition P. Bakowski P. Bakowski [email protected] [email protected]
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Page 2: Multimedia Servers Multimedia Operating Systems

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What is Digital Economy ?What is Digital Economy ?A A digital economydigital economy is an is an economyeconomy that is based on that is based on electronic goodselectronic goods and and servicesservices produced by an produced by an electronic businesselectronic business and traded through and traded through electronic electronic commercecommerce..

commercecommerce

servicesservices

businessbusiness

goodsgoods

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What is Digital Economy ?What is Digital Economy ?That is, a business with electronic That is, a business with electronic production and production and management processesmanagement processes and that interacts with its and that interacts with its partners and customers and conducts partners and customers and conducts transactionstransactions through Internet and Web technologiesthrough Internet and Web technologies..

transactionstransactions

management processesmanagement processes

productionproduction

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Under the hoodUnder the hood

Technology - driving forcesTechnology - driving forces

Changes in ITC industries Changes in ITC industries

ITC educationITC education

Some ways to be competitiveSome ways to be competitive

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The driving forcesThe driving forces

The digital economy is driven by the The digital economy is driven by the exponential growthexponential growth of of the information the information processingprocessing, , communicationcommunication, and , and storagestorage..

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The driving forcesThe driving forces

The digital economy is driven by the exponential growth of The digital economy is driven by the exponential growth of the information processing, communication, and storage.the information processing, communication, and storage.

And the progressive transformation/conversion of all And the progressive transformation/conversion of all analoganalog sources into the sources into the digitaldigital data. data.

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The driving forcesThe driving forces

19471947: First electronic programmable : First electronic programmable computer (ENIAC)computer (ENIAC)

17,468 vacuum tubes, 7,200 crystal diodes, 17,468 vacuum tubes, 7,200 crystal diodes, 1,500 relays, 70,000 resistors, 10,000 capacitors 1,500 relays, 70,000 resistors, 10,000 capacitors 27 tons 27 tons 8.5 feet (2.6 m) by 3 feet (0.9 m) by 80 feet (26 m)8.5 feet (2.6 m) by 3 feet (0.9 m) by 80 feet (26 m) 680 square feet (67.6 m²) 680 square feet (67.6 m²) 150 kW of power 150 kW of power 300 instructions per second300 instructions per second

and MTBF – and MTBF – 6 minutes 6 minutes

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The driving forces - processingThe driving forces - processing

19471947: First electronic programmable : First electronic programmable computer (ENIAC)computer (ENIAC)

nownow 2mm*2mm 2mm*2mm1 W,1 W,MTBF - yearsMTBF - years

cost – 50 cents cost – 50 cents (close to nothing)(close to nothing)

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Driving forces - processingDriving forces - processing

20102010: Tianhe-1A, the fastest supercomputer ever made: Tianhe-1A, the fastest supercomputer ever made 2.507 Petaflops 2.507 Petaflops 7,168 NVIDIA® Tesla™ M2050 GPUs 7,168 NVIDIA® Tesla™ M2050 GPUs 14,336 CPUs14,336 CPUs 4.04 megawatts4.04 megawatts

from from 300300 to to 2500 *102500 *101212 IPS IPS

from from 150150 to to 40004000 kW kW

University of Pennsylvania

The National Supercomputing Center of Tianjin -国家超级计算中心

Cost ?Cost ?

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Driving forces - transmissionDriving forces - transmission

The 1866 transatlantic cable could transfer The 1866 transatlantic cable could transfer 8 words a minute8 words a minute, , and initially it cost $100 to send 10 wordsand initially it cost $100 to send 10 wordsThat was 10 weeks’ salary for a skilled workman of the day. That was 10 weeks’ salary for a skilled workman of the day. Due to the cost, it was mainly used by the British and American Due to the cost, it was mainly used by the British and American governments and large corporations.governments and large corporations.

telegraph – first telegraph – first digitaldigital transmission transmission

8 words of 5 letters coded on 5 bits/minute8 words of 5 letters coded on 5 bits/minute

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Driving forces - transmissionDriving forces - transmission

Capacity: 32 linesCapacity: 32 linesCost: 1 min - $36Cost: 1 min - $36

telephone – telephone – analoganalog transmission transmission

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Optical transmissionOptical transmissionThe progress in transmission of digital data is related toThe progress in transmission of digital data is related to The introduction of the optical links for long distance The introduction of the optical links for long distance terrestrial telecommunication.terrestrial telecommunication.

digital signal - impulsedigital signal - impulse

0.40.4 0.250.25

40-Gbps and 100-Gbps 40-Gbps and 100-Gbps transceivers * WDMtransceivers * WDM(Wavelength Division (Wavelength Division Multiplexing)Multiplexing)

300 Km without amplification300 Km without amplification

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Optical transmissionOptical transmission

20082008: China Telecom Limited, announced the : China Telecom Limited, announced the presale of the Trans-Pacific Express.presale of the Trans-Pacific Express.The cable, a $500 million investment of the The cable, a $500 million investment of the consortium team, led by China Telecom, is consortium team, led by China Telecom, is 13,00013,000 milesmiles long and will carry long and will carry 2.562.56 TerabitsTerabits per second. per second.

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Telephone line transmissionTelephone line transmission

Copper and Radio links : The increase of the data rate Copper and Radio links : The increase of the data rate relative to the physical spectrum (spectral efficiency)relative to the physical spectrum (spectral efficiency)

2010:2010:HuaweiHuawei Technologies has unveiled a SuperMIMO DSL Technologies has unveiled a SuperMIMO DSL

Using four twisteUsing four twisted pairs helps address crosstalk d pairs helps address crosstalk problems and in turn, this allows an increase in problems and in turn, this allows an increase in bandwidth per channel to around 175Mbps, reaching bandwidth per channel to around 175Mbps, reaching around around 700Mbps over 400 metres700Mbps over 400 metres..

175Mbps/30MHz => 5.5 b/Hz !175Mbps/30MHz => 5.5 b/Hz !

At 30 MHz very high attenuation ?At 30 MHz very high attenuation ?

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Radio transmissionRadio transmission

the increase of the data rate relative to the physical the increase of the data rate relative to the physical spectrum (spectral efficiency)spectrum (spectral efficiency)

2010:2010:HuaweiHuawei, demonstrated data download speeds of up to , demonstrated data download speeds of up to 600Mb/s600Mb/s using its latest using its latest LTE-Advanced LTE-Advanced system at system at GSMA Mobile World Congress GSMA Mobile World Congress 20102010. The record . The record speeds, which are speeds, which are 20 times faster20 times faster than existing than existing commercial commercial 3G3G networks, is expected to revolutionize networks, is expected to revolutionize user experience by meeting bandwidth requirements of user experience by meeting bandwidth requirements of data heavy applications, such as being able to transmit data heavy applications, such as being able to transmit a a 4GB DVD movie in less than one minute4GB DVD movie in less than one minute..

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Driving forces – data storageDriving forces – data storage

They are provided through They are provided through magneticmagnetic and optical and optical supports.supports.

19731973

IBM 3340 hard disk unit: IBM 3340 hard disk unit: 7 fixed 14-inch (360 mm) 7 fixed 14-inch (360 mm) disks, and each unit had disks, and each unit had a capacity of 571 MB.a capacity of 571 MB.

20102010: Seagate first 3.0TB hard : Seagate first 3.0TB hard drive (3.5-inch)drive (3.5-inch)Problem with Problem with 512B segments 512B segments !!

223232*2*299 = = 224141

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Driving forces - storageDriving forces - storage

Between 2008 and 2010, Seagate realizes the hard disk Between 2008 and 2010, Seagate realizes the hard disk production of 500 million, the total capacity reaches production of 500 million, the total capacity reaches 39,500,000TB39,500,000TB..

Equivalent of :Equivalent of :

• 60 billion hours of digital 60 billion hours of digital videovideo

• 500 billion hours digital 500 billion hours digital musicmusic

Seagate expects, only takes after Seagate expects, only takes after 2 years2 years, can realize the , can realize the accumulative total production of accumulative total production of 2 billion hard disks2 billion hard disks. .

2 billion * 1 Terabytes = 2*102 billion * 1 Terabytes = 2*109+129+12 bytes bytes

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Driving forces - storageDriving forces - storageSINGAPORE, Aug 4 2009 - Computer hard disk maker SINGAPORE, Aug 4 2009 - Computer hard disk maker Seagate Technology said it will Seagate Technology said it will lay off 2,000 workers in lay off 2,000 workers in Singapore.Singapore.

Seagate said the hard drive factory would be closed by Seagate said the hard drive factory would be closed by the end of the end of 20102010, its production capacity will , its production capacity will move move manufacturingmanufacturing to other locations, which include to other locations, which include Thailand, Thailand, China and MalaysiaChina and Malaysia..

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Driving forces – data storageDriving forces – data storage

They are through magnetic and They are through magnetic and opticaloptical supports. supports.

The optical disc was The optical disc was invented in invented in 19581958

In In 19791979, Philips and Sony, , Philips and Sony, in consortium, successfully in consortium, successfully developed the audio developed the audio compact disc in 1983.compact disc in 1983.

700MB of net user data for 700MB of net user data for a 12 cm CDa 12 cm CD

BluRay defines as its BluRay defines as its standard physical media a standard physical media a 12 cm (same as DVDs and 12 cm (same as DVDs and CDs), 25 GB per-layer CDs), 25 GB per-layer optical disc, with optical disc, with dual layerdual layer discs discs 50 GB,50 GB, additional additional layers possible later.layers possible later.

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Moore’s LawMoore’s Law

2010: 1 transistor cost < 1 printed letter cost2010: 1 transistor cost < 1 printed letter cost

Transistor count doubles every 18 monthsTransistor count doubles every 18 months

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Processing power Processing power Computing powerComputing power doubles every 24 months doubles every 24 months

GFLOP/sGFLOP/s

GPUGPU

CPUCPU

personal super-computingpersonal super-computing

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Processing costs (50 years) Processing costs (50 years)

1960 1970 1980 1990 2000 20101960 1970 1980 1990 2000 2010

1000000$ – 1 MIPS1000000$ – 1 MIPS

1 $ – 100 MIPS1 $ – 100 MIPS

ratio : 1000000000 = 100*10ratio : 1000000000 = 100*1066

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Transmission capacity Transmission capacity

25 Tb/s25 Tb/s

theoretical theoretical limitlimit

practical practical limitlimit

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Telecommunication costsTelecommunication costs

1960 1970 1980 1990 2000 20101960 1970 1980 1990 2000 2010

10 $ - 60s*64Kb/s (480 KB)10 $ - 60s*64Kb/s (480 KB)

1 $ – 4000 *60*64Kb/s (19.2 GB)1 $ – 4000 *60*64Kb/s (19.2 GB)

ratio : 40000 (for a transatlantic line)ratio : 40000 (for a transatlantic line)

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Storage capacity Storage capacity Hard disk storage cost per unit of information (byte) Hard disk storage cost per unit of information (byte) follows Kryder's Law (was Seagate vice president)follows Kryder's Law (was Seagate vice president)

disk capacitydisk capacityin GBin GB

19801980 20102010

10001000

0.0010.001

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Magnetic storage costs (50 years) Magnetic storage costs (50 years)

1960 1970 1980 1990 2000 20101960 1970 1980 1990 2000 2010

1000$ – 1 MB1000$ – 1 MB

1 $ – 10 GB1 $ – 10 GB

ratio : 10000000 = 10*10ratio : 10000000 = 10*1066

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Optical storage costs (30 years) Optical storage costs (30 years)

1980 1990 2000 20101980 1990 2000 2010

1$ – 1 MB1$ – 1 MB

1 $ – 100 GB1 $ – 100 GB

ratio : 100000 = 100*10ratio : 100000 = 100*1033

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Microelectronics key enablerMicroelectronics key enabler

$256B$256B$43B+$43B+fab equipmentfab equipment

$42B+$42B+materialsmaterials

$1620B$1620B electronic industryelectronic industryEurope (26%)Europe (26%)

automobile, medical automobile, medical defense/spacedefense/space

$6320B+$6320B+

Internet providers, games, telecom, broadcastInternet providers, games, telecom, broadcast

20072007

20102010: more than 10% of world product (and growing!): more than 10% of world product (and growing!)

embedded embedded systemssystems

silicon foundriessilicon foundries

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Pure foundriesPure foundries

2007 and2007 and

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Pure foundriesPure foundries

20102010: ready : ready for 28nmfor 28nm

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Electronic circuits – top 10Electronic circuits – top 10

fablessfabless

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Electronic systems – top 10 Electronic systems – top 10

American and American and European European companiescompaniesare are brands;brands; the the productionproduction (and the (and the designdesign) ) is done is done mainly in Asia mainly in Asia

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EMS and ODM revenuesEMS and ODM revenues

Electronic Manufacturing ServicesElectronic Manufacturing Services

Original Design ManufacturersOriginal Design Manufacturers

Compound Annual Growth Rate

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Electronic systems – top 10 Electronic systems – top 10

FoxconnFoxconn is the biggest EMS company is the biggest EMS company employees: 900 000 (2009) => 1 300 000 (2011)employees: 900 000 (2009) => 1 300 000 (2011)Revenue: $80 billions (HQ: Taipei, factories Shenzen, also Revenue: $80 billions (HQ: Taipei, factories Shenzen, also Poland – Lodz - “reverse off-shoring”) Poland – Lodz - “reverse off-shoring”)

Foxconn Foxconn LodzLodz

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Software revenueSoftware revenuein $ billionsin $ billions

software only software only

Remark: almost all software companies Remark: almost all software companies produce their software off-shoreproduce their software off-shore

pure softpure soft

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Software companiesSoftware companies

20102010: IBM India -155,000 employees second : IBM India -155,000 employees second IT company after Tata Consulting ServicesIT company after Tata Consulting Services

January 2009January 2009: Microsoft initiated first broad layoffs in the : Microsoft initiated first broad layoffs in the company’s history. Microsoft, based in Redmond, Wash., company’s history. Microsoft, based in Redmond, Wash., plans to lay off 5,000 of its 94,000 employees over the next 18 plans to lay off 5,000 of its 94,000 employees over the next 18 months. Software giant Microsoft plans to lay off 55 Indian months. Software giant Microsoft plans to lay off 55 Indian employees, around 1 per cent of its 5,500-strong workforce in employees, around 1 per cent of its 5,500-strong workforce in the country. the country.

20102010: Oracle India has at least 23000 : Oracle India has at least 23000 employees including its India sales, research employees including its India sales, research and development centre and Oracle Financial and development centre and Oracle Financial Services Services

IBM employed 398,500 people world-wide at the end of 2008.

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Software companiesSoftware companies

InfoSys: 109 882 employees as on InfoSys: 109 882 employees as on December 31, 2009 (India, Mexico, Brazil December 31, 2009 (India, Mexico, Brazil but also Poland – Lodz “reverse off-shoring) but also Poland – Lodz “reverse off-shoring)

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Telecom revenueTelecom revenue

Global Telecom Revenues in $ billionsGlobal Telecom Revenues in $ billions

equipment plus operators services equipment plus operators services

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Telecom revenue - operatorsTelecom revenue - operators

The worldwide The worldwide telecom operatorstelecom operators market generated market generated

USD1.8 trillion (EUR1.3 trillion) in revenue in 2009USD1.8 trillion (EUR1.3 trillion) in revenue in 2009

The top ten operators are:The top ten operators are:

1. AT&T (USA) 2. NTT (Japan)1. AT&T (USA) 2. NTT (Japan)

3. Verizon (USA) 4. Deutsche Telekom (Germany)3. Verizon (USA) 4. Deutsche Telekom (Germany)

5. Telefónica (Spain) 6. Vodafone (UK)5. Telefónica (Spain) 6. Vodafone (UK)

7. China Mobile (China) 8. France Telecom (France)7. China Mobile (China) 8. France Telecom (France)

9. Telecom Italia (Italy) 10. KDDI (Japan)9. Telecom Italia (Italy) 10. KDDI (Japan)

RPU=$8RPU=$8

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Telecom revenue - equipmentTelecom revenue - equipment

20102010: bankrupt: bankrupt

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Telecom revenue - equipmentTelecom revenue - equipment

92% fall 92% fall in profitsin profits

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Telecom revenue - equipmentTelecom revenue - equipmentA A privately held companyprivately held company or close or close corporation is a business company corporation is a business company owned by a relatively small number of owned by a relatively small number of shareholders or company members shareholders or company members which which does not offer or trade its does not offer or trade its company stockcompany stock (shares) to the general (shares) to the general public on the public on the stock marketstock market exchanges. exchanges.

With « unlimited » account With « unlimited » account opened by opened by Chinese government (Ren Zhengfei).Chinese government (Ren Zhengfei).

TIME Magazine :

Ren Zhengfei fashions himself after Chairman Mao

The man who shapes your life !

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IT & Intellectual PropertyIT & Intellectual PropertyFromFrom industrial economy industrial economy to a to a knowledgeknowledge (information) (information) based based economyeconomy with Intellectual Property (IP) assets. with Intellectual Property (IP) assets.

Standard & Poor's 500 IndexStandard & Poor's 500 Index

knowledge, knowledge, digital digital information,information,ICT, ICT, High TechHigh Tech

factories - factories - machinerymachinery

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IT & Intellectual PropertyIT & Intellectual PropertyPalm PilotPalm Pilot – the pioneer in hand held devices in early – the pioneer in hand held devices in early 90's. Palm 90's. Palm market capitalization market capitalization has been reduced by has been reduced by around 85%. Palm around 85%. Palm failed to protectfailed to protect the the Intellectual Intellectual Property Property it owned in order to prevent the competitors it owned in order to prevent the competitors from duplicating goods and services it has developed..from duplicating goods and services it has developed..

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How to obtain IPsHow to obtain IPs

flatflat

1. Aquisitions (ALCATEL, VOLVO,..)1. Aquisitions (ALCATEL, VOLVO,..)

2. Education in Egineering2. Education in Egineering3. Research, Development3. Research, Development3. PhD studies (grey IPs)3. PhD studies (grey IPs)

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Education in EngineeringEducation in Engineering

40% 40% from from AsiaAsia

linearlinear

2010 2010 ::1 million !1 million !

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PhD students in S&EPhD students in S&E

35-40% Chinese35-40% Chinese

2010 2010 : almost 3 : almost 3 times more times more Chinese than US Chinese than US PhD candidatesPhD candidates

« grey » « grey » IP transferIP transfer

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High Tech export sharesHigh Tech export shares

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ICT products export sharesICT products export shares

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How to compete ?How to compete ?

Use modern technologies, be efficient, be flexible, Use modern technologies, be efficient, be flexible, be open, ..be open, ..

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How to compete ?How to compete ?

Use modern technologies, be efficient, be flexible, Use modern technologies, be efficient, be flexible, be open, ..be open, ..

Invest in:Invest in:

re-usere-use technologies technologies

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How to compete ?How to compete ?

Use modern technologies, be efficient, be flexible, Use modern technologies, be efficient, be flexible, be open, ..be open, ..

Invest in:Invest in:

re-use technologiesre-use technologies

open-source components open-source components

for for hardwarehardware and and softwaresoftware design design

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How to compete ?How to compete ?

Use modern technologies, be efficient, be flexible, Use modern technologies, be efficient, be flexible, be open, ..be open, ..

Invest in:Invest in:

re-use technologiesre-use technologies

open-source components open-source components

for for hardwarehardware and and softwaresoftware design design

« low-cost » « low-cost » supercomputingsupercomputing

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Reuse need – IP Reuse need – IP

1990 1995 2000 2005 20101990 1995 2000 2005 2010

top-down designtop-down design

integration based integration based designdesign

design complexitydesign complexity

design design gap (75%)gap (75%)

productivity productivity (25%)(25%)

IP componentsIP components

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Reuse processes Reuse processes

New techniques facilitating the New techniques facilitating the researchresearch, , selectionselection, , adaptationadaptation, and , and integrationintegration of reusable components. of reusable components.

researchresearch

selectionselection

adaptationadaptation

integrationintegrationsystem integrationsystem integration

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Reuse time-lineReuse time-line

timetime

complexitycomplexity

reusereuse

code code evolutionevolution

technologytechnology

generationsgenerations

impl

emen

tatio

nim

plem

enta

tion

impl

emen

tatio

nim

plem

enta

tion

new functions new functions and/or higher and/or higher performanceperformance

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Reuse management Reuse management

individual reuseindividual reuse

group reusegroup reuse

project reuseproject reuse

organizational reuseorganizational reuse

global reuseglobal reuse

timetime

degree/visibilitydegree/visibility external/commercial IPsexternal/commercial IPs

internal IPsinternal IPs

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Open Source components Open Source components

available components – open source IPsavailable components – open source IPs

exponential exponential growth !growth !

timetime

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Low-cost supercomputingLow-cost supercomputing nVIDIA platform and CUDA technology nVIDIA platform and CUDA technology

parallel processing/programming (C language)parallel processing/programming (C language)

super-computer super-computer for $1000for $1000

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SummarySummary

The driving factors – devices and technologiesThe driving factors – devices and technologies

Industrial landscape Industrial landscape

Intellectual Propriety and Knowledge TransferIntellectual Propriety and Knowledge Transfer

How to compete ?How to compete ?