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and it is penetrating every aspect of our lives. Today there are more PCs sold annually in the world than TVs or cars. The typical luxury automobile today has 20 to 30 microprocessors in it, more puting power by far than was inside the landingcraft that took the first astronauts to the moon. Last year there were five times more Email messages sent than the number of pieces of paper mail delivered worldwide, trillion Emails. And I got more than my share. There is another way to look at what is going on. In the mid1970s, the first super puters appeared. They were capable of about 100 million calculations per second. And they cost about one million dollars. Today the laptop puter that college students carry in their bags, packs, is twice as fast as that first super puter, and it costs less than 3000 dollars. The trend in data storage is even more impressive. In the early 80s, the standard unit of puter storage, one megabyte, or one million bytes of information, cost about 100 dollars. Today, it is 10 cents. In two years, it will cost 2 cents. These gains are driven by continuous advances in how we pack information into smaller and smaller spaces. If the US Library of Congress could shrink its collections of 17 million books by the same factor we just discussed, it could replace 800 kilometers of shelf space with less than 40 meters of space. These advances are going to continue and accelerate the rate microprocessors, storage, munications, memory, and all the other engines that are propelling this industry or continue to lead to the products of the faster, smaller, and less expensive, just as they have for 30 years. But as we stand here today, the opening of CeBIT, we are on the threshold of a very important change and the evolution of this industry. In many ways, this industry, a very emitory industry, is about to play out in its most important dimension. That is because the technology has bee so powerful and so pervasive that its future impact on people and governments and all institutions will dwarf what has happened today.I believe there are two trends that are most significant here, and bare the closest watching.The first is what we call deep puting. The term is inspired by our chessplaying super puter Deep Blue, which I believe many of you know peted with the Grand Master Gary Kasparov last year. Deep Blue is an amazing machine, capable of 200 million moves per second. But speed, while essential, is not enough. After all, Deep Blues predecessor was quite fast, but it loss to Gary Kasparov two years ago. The difference in second time around was an infusion of knowledge, human chess knowledge, thousands and thousands of chess moves, games and outes, captured as mathematical algorithms. This is what led Deep Blue to mimic the workings of the human mind, and race through millions of possible chess positions and extract the best one. And it worked rather well. But Deep Blue is emblematic of a whole class of emerging puter systems that bine ultrafast processing with sophisticated analytical software.Today we are applying these systems to challenges that are far more vital than chess. Let me talk about two important application areas, starting with simulation.Simulation is about replacing physical things with digital things, recreating reality inside these powerful puter systems. In the farmer suitacle industry, the ability to simulate the interaction of chemicals, and do it in the puter rather than in testtubes and Petri dishes, can speed up by years the discovery and testing of new farmer suitacle. Mercedes, BMW, Fiat, Volvo, SAAM all design cars today on put