Commodity Software

The universe is coming for your software margins.

Commodity Software

Man is special because he is an inventor.

An inventor has no limits but those of nature.

New inventions are imbued with something special.

The creators can enjoy protections from governments, accolades from peers and even high margins for adding something to the vast frontier of human creation.

Over time what was once a noteworthy invention just becomes a normal part of life and a piece of regular infrastructure.

It gets improved over and over and becomes just some "thing" that sits in your kitchen or is installed in your car.

It comes to a point where it essentially complete.

The problem it was created to solve is solved.

Think of the hammer, the belt, the rolling pin, gasoline, and almost everything with a name a child would know.

These things where inventions. Now they are just things.

Easy to find, manufacture, buy, understand etc.

Nothing special!

Over time this happens to all things.

It's a wonderful process that helps bring the magic of the future to the masses at a price they can afford.

It also pushes the ambitious to move on to build the next thing since the benefits reaped as an inventor do not last.

This is where we are with software.

Software is now a solved problem.

We have invented and iterated and we have mostly solved it.

If you're sitting there thinking about how hard it is to build something meaningful in software still and disagree let me remind you why you are not a farmer.

You are not a farmer because its hard as shit and an extremely complex craft to master and also happens to be one of the most commoditized industries on earth.

Complexity is not the opposite of commodity.

People who invest in traditional agriculture today don't worry if they will be able to grow the crops. They know for a fact they will be able to.

In the same way people who invest in software startups don't worry if the software can be built. They know for a fact it can.

Editing text, updating a database, clicking a button.

Any version of this at any scale is now a solved problem.

This also means we have come to the point where the universe reduces the rewards to the inventors and the most ambitious move on to greener pastures.

The foundations of business is gravitating towards low cost commodity software.

The companies that where awarded 90% margins will be eaten slowly by companies that will do it for 60% then 50% then 40% as is tradition.

Many companies will just keep it simple and make the software they need rather than purchasing any.

This has been a public service announcement.

The universe is coming for your software margins.