Another interesting related perspective that we used to give our (business information systems) students to argue about is "IT doesn't matter" by Carr (2003).
Can be found online at: https://hbr.org/2003/05/it-doesnt-matter
Software Is the New Oil
31–40 of 89 posts
Re: Software Is the New Oil
#32So California Is the New Texas.
Re: Software Is the New Oil
#33Very vague comparison. Software is a technology and oil is a commodity.
you can't copy oil, you can't open source oil, software isn't limited
Re: Software Is the New Oil
#34It's a grabby headline, but after reading it, it came across as an attempt to create a new business meme, rather than compelling arguments. All these companies make money through very different means, not just software. Most of them are valuable because they've monopolized sizeable chunk of consumer space through combination of good planning, products, designs, marketing, and a little bit of luck.
Also, there are other wildly profitable companies in other sectors that have been around for decades.
Re: Software Is the New Oil
#35“We are long software”
Of all the suit babble I ever heard, this must be the most incomprehensible. Juggling stock options apparently wreaks havoc on the speech center of your brain.
Re: Software Is the New Oil
#36Oil is fundamentally rent-seeking. You're pumping money out of the ground. Software platform companies are the real equivalents.
I think the difference is that the state of the art shifts so quickly, long term survival for platforms is questionable. There's always a new player.
Re: Software Is the New Oil
#37Oil is finite, one day there won't be anymore. Software is potentially infinite as long as you can produce electricity ton run it.
Re: Software Is the New Oil
#38If software is the new oil, be prepared for a wild ride. The oil industry is notorious for decade-scale cycles of over-hiring and then layoffs and under-hiring, rinse-lather-repeat. Regardless, it's a good analogy, but be careful how far you take it. There's a _very_ important difference between the energy and other major industries. It's a difference that the software industry shares, but in the opposite extreme: Th…
* In that sense, oil companies have more in common with independent nations than with other companies.*
This is no joke. I grew up around big Oil coming from Houston. There was a joke that Chevron effectively had the second largest combat navy in the world because of how many resources they devoted to platform and tanker defense.
Re: Software Is the New Oil
#39This is a fascinating analogy and shouldn't be written off, even though the OP is missing many of the parallels.
Michael O. Church wrote about this in a recent blog post ( https://michaelochurch.wordpress.com/2015/10/17/the-four-sta... ). The core argument is that Silicon Valley is now a resource-extraction culture.
Ultimately, I’ve come to the conclusion that the source of Silicon Valley’s ethical failure is pretty simple: it’s a resource-extraction culture. I doubt that its culture is any more negative than, say, the oil or gas industries. What is this resource? There are two key resources that drive Silicon Valley. The first is the flow of passive capital into an oligarchy of careerist bureaucrats (venture capitalists) who invest other peoples’ money into supposedly technological companies. The second is self-undervaluing talent, which arrives in waves each summer in Northern California. The combination of these resources, along with optimistic overvaluation (worst of all, not only by investors but by the workers) of the companies and the career opportunities they will provide, creates an environment in which a small number of individuals can become very wealthy.
He concludes that the finite resource being extracted is the good will of the American middle class. To that, I would also add the prestige of the U.S. abroad, since the country remains a destination for hard-working immigrants. As the Valley runs out of its ability to run on middle-class American good will, as people eventually learn that their startup equity isn't going to make them millionaires, it will instead run on third-world desperation through the H1-B program. So it has a long way to go before it dies out entirely, but the observation that VC-funded technology is a resource-extraction culture is spot-on accurate.
Re: Software Is the New Oil
#40I feel 'data' or rather big data is the new oil. There are big monopolies which control a lot of it and are trying to make sense out of it, the likes of Amazon, Google, Palantir et. al. and similarly there are companies like ExxonMobil in the energy sphere. We could in fact extend this analogy to smaller players in the renewable energy zone which are trying to make better qualitative use of their resources and simila…
The difference between data and oil is that you aren't going to drive to the oilfields one morning and find that it's all been hacked and stolen. Data is collected. Oil is sold.
> The difference between data and oil is that you aren't going to drive to the oilfields one morning and find that it's all been hacked and stolen.
Ask Western oil workers in Libya or Nigeria or Venezuela or Mexico (depending on the decade) how accurate they feel that sentence is. Oil concessions have been regularly expropriated.