In the Future, Will Software Be More Important than Hardware?

From  talent wars going on in Silicon Valley for software engineers, to the hundreds of thousands of new smartphone applications coming online, it’s not far-fetched to believe that software rules the world today and will continue to rule in the future. However, some hardware makers strongly disagree- that it’s the physical design, construction and production of the device, machine or infrastructure that will take precedence. Who holds the future – hardware makers, software makers—or both?

Flickr for android, courtesy of Flickr.

A Financial Times article by Andrew Keen highlights a brewing battle between hardware and software makers for investor dollars. Both sides believe that they are the smarter investment for the long run. And both have a point.

First, it’s tempting to see hardware manufacturing as nothing more than something that should be outsourced. After all, companies such as Amazon source the production of the Kindle to offshore manufacturers, and it’s commonly understood that most large computer companies leave production of machines to Chinese/Taiwanese contract manufacturers such as Flextronics, FoxConn and others.

However, increasingly companies such as CPU manufacturers and tablet makers are taking some of these manufacturing capabilities in-house, especially as product complexity increases and integration between software and hardware becomes more commonplace.

In addition, taking manufacturing capabilities in-house means less bureaucracy in terms of working with an outsourced vendor, arguably higher accountability (no one to blame for failures), and more control over manufacturing processes. Net, net in many cases the higher a product moves up the value chain in terms of complexity and integration, the more it makes sense for companies to assert authority, control and accountability for manufacturing operations—sometimes all the way to the point of assuming full responsibility for hardware production.

The counter argument however is hardware will always be a commodity. Designs and specs can be written so that just about any respectable contract manufacturer can produce a product. The real value, say software makers is the design of user interfaces all the way to behind the scenes algorithms responsible for executing complex processes.

Proof points for the “software will rule” camp include software companies gaining a bigger slice of VC funding, and the number of applications developed for iPhone (650k) and Android (400k). For further reading on this perspective, review VC and market maker Marc Andreessen’s comments.

Ultimately, the most likely answer of who will win the future (hardware vs. software) is that there’s a place for both camps. For example, it’s the integration of commodity hardware with advanced software that seems to be the best fit for many companies looking to acquire analytics capabilities.

This is evidenced by the data warehouse appliance trend of an engineered and integrated solution stack of hardware and software coupled with services for implementation, maintenance and operations. These solution stacks are architected, performance tested, certified and supported. And they usually come from a single vendor responsible for the entire end-to-end package.

In the meantime, we have a strong debate. VC’s like Marc Andreessen say software companies are primed to “take over large swathes of the economy”. Hardware makers claim the user experience in terms of design, touch and feel is more relevant than ever. What say you?

Digital Design: Instagram and the Pursuit of Beautiful New Things

For some Silicon Valley companies, the mantra is: “Slap code together, design a quick user interface, and get it to market.” And above all, as Mark Zuckerberg would remind us, “Keep shipping.”

In the very near future, such talk will probably give Instagram founder Kevin Systrom heartburn. That’s because Systrom thinks designing software code should be an inspired effort, just like the delectable creations of top chefs around the world.

When it comes to digital products, the idea that form follows function is being tossed out the window. As a New York Timearticle describes, it’s no longer necessary to simply examine a digital device or application to discern what it does. But that doesn’t mean there’s not a sense of beauty and simplicity necessary for digital products. In fact, the goal for software engineers designing best-in-class digital products is to build instinctive and intuitive applications and devices.

Perhaps that’s why Kevin Systrom’s Instagram was worth one billion dollars to Facebook. As noted in a Financial Times article titled, “The Aesthete of Silicon Valley Who Makes Photos Beautiful,” Systrom is obsessed with building things that are inherently beautiful.  Systrom says great chefs who painstakingly labor over their creations and add high-quality ingredients despite potentially higher costs inspire him. “The things we’re creating solve a need,” he says, “but in the meantime, they should be visually stimulating and fun to interact with.”

An obsessive personality, Systrom would likely have been a better disciple of Steve Jobs rather than of his new boss, Mark Zuckerberg. “Kevin notices the details that most of us don’t notice,” says Clara Shih, a friend of Systrom. “He’s a slow walker and lets himself get distracted. He takes time not just to smell the roses but to analyze the roses and think about the detail.”

Technological advances are coming so fast that it takes us a long time to assimilate all the benefits of each product and service. For example, software companies are notorious for rolling out hundreds of new features in each release, only to have customers use very few.

As our digital lives get inevitably more complicated, there will be an insatiable customer requirement for simplicity and aesthetic beauty. And as user interfaces get more cluttered, clarity in purpose and design will drive market share (as Google can attest). Indeed, the elegance of a single search box—unencumbered by advertising—is one reason Google has the lion’s share of search requests.

Instead of focusing on additional features that users will probably never use, digital companies of all stripes perhaps should aim for a crisper design and greater ease of use.

Ultimately, making digital products easier to use takes a long time in discerning and studying user behaviors, capturing those learnings, and using them to design better and more intuitive devices and interfaces. However, much like how top culinary chefs take the time to use better ingredients and obsess over the tiniest details in presenting their creations, digital creators will need to endeavor to stress the small stuff.

For digital consumers, naturalness, comfort, and fit will matter more in the near future. And thoughtfulness in terms of design and ease of use will be the next generation of differentiation for digital companies.

Finally, there’s been a bit of stress for Instagram users now that Facebook has purchased the company. Despite Facebook saying it will run the company independently, plenty of users fret that Instagram will lose its touch. However, wouldn’t it be something if Systrom didn’t end up leaving Facebook after all and instead became the company’s Jonathan Ive? It could end up being a “magical” pairing.

From Complexity to Simplicity in the Cloud

The inner workings of cloud computing can be quite complex. That’s why the founders of Dropbox are on the right path—make cloud computing as simple as possible with easy to understand user-interfaces to mask “behind the scenes” infrastructure and connections.

Open up the lid of “black box” cloud computing and what you’ll see is anything but simple. Massive and parallel server farms that never sleep, algorithms worming and indexing their way through global websites, large data sets waiting in analytical stores for discovery, message buses that route, control and buffer system requests, and massive processing of images, text and more on a grandiose scale.

That’s why companies that take the complexity out of cloud computing are thriving. Take for instance, Dropbox, a company that allows users to access their personal or corporate files from any internet connected device. A Technology Review article featuring Q&A with CEO Drew Houston cites the efforts of Dropbox to mask behind the scenes efforts of “having your stuff with you, wherever you are.”

With various operating systems, incompatibilities, file formats and more, Dropbox engineers had to wade through mountains of bugs and fixes to make the user experience as seamless as possible. “There are technical hurdles that we had to overcome to provide the illusion that everything is in one place…and that getting it is reliable, fast and secure,” Houston says.

Looking at Dropbox from the outside, a user only sees “visual feedback” via a folder, icon or the like on his/her desktop. But underneath the hood there’s a whole gaggle of technologies and code that makes Dropbox work. And to create a seamless experience, painstaking efforts are involved down to the tiniest components says Houston; “Excellence is the sum of 100 or 1000 of…little details”.

If information technology leaders plan to bring “BI to the masses”, simplicity will be a necessary requirement to mask the inherent complexity of cloud computing. Ultimately, there are plenty of business users that won’t care how their particular applications are delivered, only that they are carried out with efficiency, reliability and security. Thus, user interfaces designed with clarity, elegance and ease-of-use in mind will ultimately put a “wrapper” on complexity and drive further adoption of cloud computing delivery models.

And it’s also likely that business users will never appreciate the hard work that goes into designing, delivering and sustaining their applications on a 24x7x365 basis, and accessible from any internet enabled device. But then again, perhaps that’s the point. Application availability, security, reliability, simplicity and productivity are now the expectations of business users – it’s best to deliver “in the cloud”exactly what they want.