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Software Is the New Oil

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Re: Software Is the New Oil

#51

Post by grflynn »

sharky93 wrote: post #26

I 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…

Yeah but we then assume the data is there and exists with all the context intact too. Big Data is a one way mirror into what's happening, but this just results in watching but not being able to take part. It's a one-way operation like calculating a prime

Re: Software Is the New Oil

#53

Post by sharky93 »

rm_-rf_slash wrote: post #27
sharky93 wrote: post #26

I 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.

I guess saying 'oil' is being a bit too specific. It is more like the 'energy' that drives the modern economy? and that is sold and you find new avenues everyday of collecting(producing) it. But yeah, it digresses a bit too much from this post I guess.

Re: Software Is the New Oil

#54

Post by adventured »

fab1an wrote: post #14

I don't know nearly enough about macroeconomic trends or basics to have an informed opinion on this, but I do wonder how much of the software giant's cash-generating power is eventually still based on industries that 'extract stuff out of the planet'. Even if that dependency were indirect - say by the amount of oil/minerals/diamonds needed to produce a chip that your software needs to run on - such a dependency would…

It's an interesting consideration. Software is clearly not a primary layer, but neither is oil.

Energy, land, machinery, labor, transport - a few of the things you need to extract and then process oil. The same goes for creating and making a microchip useful. The first oil tower at Titusville didn't use oil as its energy source.

Is oil a layer two product, and software a layer three product? Perhaps, however oil is definitely not primal, it just seems like it is. The vast effort and industry required to make oil useful, along with a century of science, is mostly hidden away from view.

Re: Software Is the New Oil

#56

Post by doyoulikeworms »

toptalentscout wrote: post #45
jasode wrote: post #19

I'm not convinced by this blog post that "software" is the new oil. To me, it's the top talent of "software PROGRAMMERS" that's the "oil". Let's pretend that Google Inc opensourced their entire software stack. Now, anyone can just spend money on hardware and datacenters and "replicate" what Google does in a certain sense. But did you really duplicate their abilities? Would intelligent and visionary investors fund suc…

>> To me, it's the top talent of "software PROGRAMMERS" that's the "oil". So does that make all the rest of us plain programmers the grease?

I think all programmers are the "oil". Some are higher quality that others, just as is the case with oil. Maybe tech companies are like refineries?

This analogy is getting strange, but I like it.

Re: Software Is the New Oil

#57

Post by pcurve »

jasode wrote: post #19

I'm not convinced by this blog post that "software" is the new oil. To me, it's the top talent of "software PROGRAMMERS" that's the "oil". Let's pretend that Google Inc opensourced their entire software stack. Now, anyone can just spend money on hardware and datacenters and "replicate" what Google does in a certain sense. But did you really duplicate their abilities? Would intelligent and visionary investors fund suc…

I like this assessment much better. Software programmers are finite in number.

Maybe ordinary software programmers are like crude oil because there is finite number of them, but still abundant. And fairly fungible.

Talented ones are like highly enriched uranium in that they're much more rare than crude oil by volume.

But they're still fungible because they can jump ship and decide to burn themselves at a different company.

Re: Software Is the New Oil

#58

Post by adventured »

sharemywin wrote: post #4
ph0rque wrote: post #2

Amazon, the company that “will never make money” surprised Wall Street last week with strong profits and it seems to me that they are going to start producing cash like these other big tech companies now. I missed this... any good articles about it?

wonder when amazon shed's it e-commerce business to focus on it's real money maker cloud computing?

They'll remain linked for at least another decade. Bezos can now lean on AWS to print money that he can funnel into numerous other expeditions. He won't let go of it any time soon, he has been seeking a big money maker for some time (see: efforts in search, auctions, advertising, phones - where the leaders have generated sizable profits).

Why did Amazon launch a semi-high priced phone (rather than stay consistent to the traditional low price strategy)? Bezos was hoping it would spit off a few billion a year in profit, and they'd finally have a big cash fountain to swim in like his competitors in tech.

In four to six years AWS will be a $150-$200 billion company in terms of valuation. It'll be capable of generating $4 or $5 billion in operating profit in that time frame. It'll likely pass Facebook in terms of sales within 36 months, and Facebook is worth $292 billion.

Re: Software Is the New Oil

#59

Post by theworstshill »

The physical analogy isn't even close. The volatility at the present time may be applicable. Software is a product of someone's imagination, while oil is pumped out of the ground. Without invention of the combustion engine (also a product of someones imagination), all the oil in the world would be nearly worthless.

Re: Software Is the New Oil

#60

Post by adventured »

mathgeek wrote: post #28

"Facebook could have $20bn of cash in the next year and could be producing $20bn of cash a year soon." Came here hoping to find a "Facebook could..." line when talking about revenue. Was not disappointed. :)

Why? They're tracking to a likely $18+ billion in sales in the next four quarters. That's obviously an extremely substantial business.

By comparison SAP is Europe's largest tech company and does $21 billion in sales. Facebook will surpass them within eight quarters (at a mere ~14 years old as a company).

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