Software Is the New Oil
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Software Is the New Oil
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Re: Software Is the New Oil
#2Amazon, 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?
Re: Software Is the New Oil
#3If 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: The amount of capital needed to do business.
The energy industry is notoriously capital intensive. For my employer, a project has to be over 250 million to be considered a significant project. We have a _lot_ of those, including multiple projects in the 10-50 billion range. Sure, I work for a very large company, but even a "mom and pop" oil company (there are a lot, actually) needs tens to hundreds of millions to get started.
By contrast, the software industry prides itself on being able to get an initial product out the door with essentially no other investment than time.
At any rate, it's a fine analogy, but keep in mind that the oil industry is _very_ focused on building _big_ infrastructure. In that sense, oil companies have more in common with independent nations than with other companies. It's something to think about, at any rate.
Re: Software Is the New Oil
#4Amazon, 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?
Re: Software Is the New Oil
#5Difference between oil and software is that you can easily quantify oil (1 barrel) whereas it is tremendously hard to quantify the value of software product.
Re: Software Is the New Oil
#6Amazon, 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?
Re: Software Is the New Oil
#7Amazon, 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?
> AWS reported an operating income of $521m during Q3, which is almost on a par with the amount brought in by its parent company’s entire North American online retail business ($528m).
http://www.computerweekly.com/news/4500256048/Amazon-turns-s...
Re: Software Is the New Oil
#8And yet when you look at it, the biggest opportunities to create immense value added are on the hardware side of things: self driving cars, pharma (aging, cancer, etc.), robotics, batteries, power generation, interstellar expeditions, bringing billions of people out of poverty, etc.
I don't want to be dismissive, but the software industry might very well go through and M&A and commodification phase once it matures. It looks like oil now because those companies are big monopolies, will it last? I don't know, I wouldn't put all my assets in software, that's a bad idea in general anyway,
Re: Software Is the New Oil
#9It's software as communication/marketplace platform that makes most of the money. metcalfe's law + near zero marginal cost = $$$$.
Re: Software Is the New Oil
#10Difference between oil and software is that you can easily quantify oil (1 barrel) whereas it is tremendously hard to quantify the value of software product.
most companies pay by the click.