The future of Software (Was: August PLUG topic: Kylix)

[David P. Schwartz]

Matt Alexander wrote:

> David,
> You make some good points.

thanks.  It's fun to discuss this stuff.

> Do you see software for most uses approaching a
> sort of "commodity" state where "it just works" and there's no real incentive
> for users to upgrade?

Yes, in lots of places.  However, software is following the same kind of marketing curves (pardon the pun) as women's fashions.  What's
new in fashion these days?  Heels are up, skirts are thinner, makup is lighter, hair is shorter.  Has cotton or silk or denim technology
changed much in 50 years?  It works pretty much the same as it always did.  The biggest change: more and more garments have "Dry Clean
Only" tags on them these days. Why?  Because vendors are tired of having people return the shoddy products they put out that fall apart
in the washer.  (I recently bought a shirt, and it literally started shredding in the washer the first time I washed it.  It was 100%
cotton.  I've never even had a TeeShirt do that!  This was a nice "Polo" type shirt.)  Software is getting "skins".  Doesn't make them
sound or work any better, but it sure makes them LOOK GOOD!

> When you look at the vast majority of applications that
> most people actually use, such as email, web-browsers, and word processors,
> there's really not a lot more that can be done.

I had a math teacher in school once who told us something interesting: "For every problem there is a solution -- neat, plausible, and
wrong!".  For some reason it stuck with me.

To paraphrase your statement, you could say that when you look at the vast majority of farming implements that most farmers actually
use, such as shovels, picks, and pesticides, there's really not a lot more that can be done.

As you look at the "bigger picture" of farming, you'll notice that indeed very little has happened in the past 200 years to the state of
picks and shovels, although pesticides are a rather new development.  You'll also notice that rather than push for further development
of "pick and shovel" technology, farmers have found tools that are far more efficient and cost effective.  Like tractors and
colombines.  Pesticide technology has evolved, but not as fast as either the abilities of pests to mutate so as to be immune to them; or
to our own abilities to discover that they are also "humancides" as well.  Perhaps there wasn't much more that could be done to improve
on DDT and Agent Orange, but ... well, they were good for a time (in a manner of speaking).

The latest "technology" in "pest management" is ... to start managing crops better!  They plant cotton, for example, with every third
row seeded with a different plant that produces berries that are toxic to pests that attack cotton plants.  For some strange reason,
insects have an easier time adapting to man-made pesticides than they have adapting to toxins that occur naturally in the environment.
Now, how many billions of research dollars did it take to figure that one out?  What they don't know very well is what the optimal
proportions of market crops and anti-pest crops are needed.  (Asian cultures were well-versed in such things until "modern farming" came
along in the 1800s and changed all that.)

So, if some guy spends ten years studying crops and insects and eventually discovers some wonderful Rosetta Stone description that tells
farmers exactly how to choose optimal mixes of each type of plant, do you think he should be compensated for it?  Or do you think other
farmers are simply "entitled" to the fruits of his labors just because?  Remember, we started off talking about "pick and shovel"
technology here.

My point is, technology is not an end in itself.  Technology itself ends, but is invariably superceded by something new and more
innovative.  Consider that email, web browsers, and word processors are at the same evolutionary point in our use of computer technology
as picks, shovels, and pesticides are  relative to farming.  Remember, in 1899, the head of the US Patent Office wrote to the President
that he could soon expect to close down the Patent Office because just everything that was truly useful had already been invented.
Farming is not accomplished today by derivatives of picks and shovels any more than today's cars are derivatives of the horses that used
to pull buggies.

Come to think of it, the state of "horse technology" hasn't evolved much in centuries, either.  Do they give horses away for free?

(As an aside, there's a guy named James Burke, a Brit, who put together a bunch of shows called "Connections" in the early 80's.  He
shows how a variety of totally independent scientific and social breakthroughs occurring throughout history contributed to things as
significant as the moon landing and as mundane as how we use bread mold derivatives to fight off disease.  His stories are absolutely
fascinating!)

> It seems to me that the
> biggest threat to proprietary software developers is that they can only
> sharpen the knife so much before users just don't care anymore.

Well, yes and no.  The problem with email, for example, is that it's the wrong knife for some things.  Like for sending a 500MB file
representing a 30 second intro of a new song as a raw Dolby 5.1surround mix across the country for someone to edit and return in an
hour.  A full Ginzu knife set contains a dozen different knives -- why is that?

In the same vein, how many really different email programs exist vs. how many different needs are there for different approaches?  For
the right combination of factors, email is as useful as a pay phone that interrupts you every minute to deposit another quarter because
nobody thought people would make calls longer than one minute.  (Remember who was quoted as saying, "People will NEVER need more than
64k of memory in their computers" -- one young Bill Gates.)

> Version 19.7
> of "Knife" might be 3% sharper than Version 19.6 of "Knife," but most users
> aren't going to care and they're not going to be interested in forking (no pun
> intended) over more money for a new tool that offers very minimal (if any)
> advantages over their previous tool.

I think that the problem is really that Microsoft and AOL have been so effective in their marketing tactics that people figure that
anything not included in Windows or AOL's environment must not be very useful or significant.  I don't know about you, but there are a
lot of people I talk to who consider ZIP files some kind of strange virus; they believe that if people were meant to use ZIP files, then
their good ol' Windoze software would support them.  They resent having to download extra things that are indistinguishable from the
rest of the goodies that came in the box.  They want to know why they had to pay for all those useless goodies in the box and then
purchase other goodies that weren't included.  THAT is the "ace in the hole" that MS wields -- they really want people to think that if
it's not included, then it's not useful,  and possibly even dangerous.  (As if Lookout Express is safe!!!!  Ha Ha ha ha He hehehe!!!!!)

>
> We've already pretty much reached the point of "commodity" hardware.  Do I
> really care that there's a 8000.74THz Pentium 64 available, when my Pentium II
> 350MHz system does everything I need just fine?
> My point is, I don't think that the software or hardware industry can possibly
> support in the future the incredible growth (and high salaries) that have been
> present in the past.

I believe we are poised on the edge of a few unimaginable transformations in the use and application of computer technology.  Remember,
in 1900 the use of horses to pull buggies in large cities was creating such a problem that city planners were estimating that it would
soon become prohibitively expensive to dispose of all the manure they created.  Sometime around the 1930s, Bell Labs estimated that in a
couple of decades there would be so many people with telephones that it would take every man, woman and child in the country to operate
the switchboards.  They were right.  You're probably very right.  What happened to the horses and switchboards?  What's the most likely
outcome in your scenario?  If you can predict what it will be (just one of the many), you could be a VERY RICH man!

>
> Microsoft realizes this, and that's why they're desperately trying to move
> people over to a subscription model for their software.  If they can charge
> you just like the utility company charges you, then they can ensure a healthy
> revenue stream for their future.  But is the customer really gaining anything
> over the old model?  No.  I'm almost positive that whatever "upgrades" occur
> will be minimal.  Once Microsoft has you hooked on the subscription service
> for Office or Windows or whatever, they won't even need software developers
> anymore.  :-)  You basically pay over and over again to use their product, but
> it's essentially the same product that had reached a certain level of
> functional maturity years ago.

I still assert that Microsoft has gotten themselves into exactly the same posture that IBM put themselves in 20 years ago, and the
outcome is going to be just about the same.  Except ... MS has the dubious honor of having their software running on about 100 million
more computers than IBM ever sold up until 1980.  If anything, that puts them into a far more precarious position than IBM was EVER in.

Look, puzzle on this: what are their assumptions right now about their future?  On the one hand, they're seeing the writing on the wall,
as you say.  So, on the other hand, they're trying to use their might and monopolistic position to do something very unwise and arrogant
-- make the vast majority of computer users both morally and financially dependent on them, their software, and their, uh, ahem...
"goodwill".  Right.

Did you happen to notice the HEADLINE on today's AZ Republic?  Something about how the government has decided that the Code Red virus is
a threat to the nation's security?  Did you also notice how they downplayed the fact that it ONLY affects people running Microsoft's
server software who've been too lazy to bother installing security updates?  Duh!...  Predictably, the next "hook" in that
"subscription" model is going to be a requirement that MS have the ability to update "their" server software on "your" machine remotely
-- by order of the Defense Department!

Maybe the MS model is closer to this: you pay for the computer hardware, connectivity, and power, and MS will also charge you to rent
your server in order to make it available to others on the web.  If you violate their web management policies, they'll disconnect you
from the web.


>
> ~M
>
> Quoting "David P. Schwartz" <davids@desertigloo.com>:
>
> > Every product you buy, whether it be at the grocery store, the
> > department store, wherever, has a portion of it's price going to the
> > retailer, a portion going to the distributor(s), and a portion going to
> > the manufacturer.  Some of the amount paid to the mfgr is for
> > "intellectual property".  Nothing you purchase in a store costs even 5%
> > of what you pay in terms of its raw goods
> > costs.  I don't get the issue people have around paying for software.
> >
> > The only way companies can really make a profit is by gaining leverage
> > on their costs of goods plus costs of manufacturing.  An average
> > employee who's paid $10/hr in a mfgr job is part of a larger equation
> > whereby the company is earning between 100 and 1000 times that.
> >
> > The stuff inside a box of cereal costs less than the package, yet people
> > seem happy to pay nearly $5/box for cereal these days.  A floppy disk
> > and CD cost more to manufacture than the entire box of cereal.  Some
> > people argue that the major difference is that cereal is consumable,
> > whereas software is not.  I guess the same argument can be made about
> > cars, that they're consumable.
> > So you don't mind paying $20k for a car that costs less than 20% of that
> > in raw cost of goods.
> >
> > If you measured the "consumption rate" of software by the number of
> > times you used software, then maybe $5/use would satisfy you for most
> > needs -- but would you pay that for your email service?
> >
> > We are able to earn as much as we do as software developers because
> > there is a far greater demand for our services than supply, and because
> > the results of our labors are HIGHLY leveraged by the people who pay us.
> >  If a company isn't earning 10x what they're paying us for our time,
> > they're not being very smart.  If the results of our work were priced
> > like cereal, then we'd be
> > earning $10/hr, and the company would be earning 1000x our pay off our
> > efforts and we wouldn't be having this discussion about "selling
> > software" because it would be designed to be consumable, like cereal,
> > and sell for $5 per use.
> >
> > -David
> >
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