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Ask HN: Is there an over supply of tech products and services?

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Ask HN: Is there an over supply of tech products and services?

#1

Post by masslessness »

I'm a keen follower of the tech scene, especially all the great stuff that comes out of Silicon Valley and the rest of the world. Something that puzzles me is the sheer volume of projects and startups that are launched and receive funding.

Surely not all of them are able to generate any sustainable revenue that is long-term. What's the value to the creators therefore who sink countless hours into creating them and to investors who pour in so much money?

There's only so many consumer eyeballs and wallets in the world, it almost seems the supply of products and services is unimaginably over supplied to a fixed demand? Or is that the wrong way of looking at it?

Re: Ask HN: Is there an over supply of tech products and services?

#2

Post by PaulHoule »

I think a general theory of it is that once in a while somebody comes up with something people really value and it expands the market and then me too competitors pile in and soon it looks like what you say.

The way to make it BIG is to find an untapped market and be the first to really serve it.

One example I would look at is that health and fitness trackers are crowded but a lot of suffering and lost productivity is caused by chronic pain of various sorts, there is no safe and effective drugs, no end of scams, but perhaps it is the kind of problem, like cystic fibrosis, that can be defeated with intensivity. For instance if you see a physiotherapist he or she might do the right things but only 1/10 as much as you need.

Re: Ask HN: Is there an over supply of tech products and services?

#3

Post by atroyn »

You're right, not all of them will succeed. Most will fail, in a proportion greater than 80% of all funded projects. In the consumer space, this is an even higher number.

The thing is, it's impossible to know in advance with certainty which will fail and which will succeed. But the ones that do succeed create an enormous return on all that sweat and money. Investors try to pick winners, but even then it's acknowledged that the majority of even the best portfolio will not make a large return.

From the founder's point of view, building something on your own that people genuinely want is an amazing education - even a small amount of success makes a founder far more valuable and goes a long way to expanding their possibilities to try again.

Re: Ask HN: Is there an over supply of tech products and services?

#4

Post by caio1982 »

The people you talk about, those who will eventually fail more than succeed because of hardcore vast competition, should instead look for the rest of the world first and only then to Silicon Valley. Silicon Valley might seem over supplied as you say, but the rest of the world is just waiting for great ideas, nice solutions etc with its wallet full of foreign money. So no, I don't think there's an over supply of tech products and services. What we currently have, in my opinion, is an over supply of few-years-old-companies-trying-to-hit-a-homerun in a crowded business place (the US).

Re: Ask HN: Is there an over supply of tech products and services?

#5

Post by czbond »

caio1982 wrote: post #4

The people you talk about, those who will eventually fail more than succeed because of hardcore vast competition, should instead look for the rest of the world first and only then to Silicon Valley. Silicon Valley might seem over supplied as you say, but the rest of the world is just waiting for great ideas, nice solutions etc with its wallet full of foreign money. So no, I don't think there's an over supply of tech…

Perfectly stated!

Re: Ask HN: Is there an over supply of tech products and services?

#6

Post by patio11 »

There's only so many consumer eyeballs and wallets in the world, it almost seems the supply of products and services is unimaginably over supplied to a fixed demand?

Are you of the impression that the demand for, I don't know, B2C cell phone apps is fixed in 2014 to the same value it was in 2007? If you (sensibly) do not agree that the iPhone failed to change the underlying demand for cell phone applications, consider the possibility that we are, in fact, crushingly undersupplied for B2C software. This would counsel people buying positive expected value lottery tickets as soon as the startup founders can print them.

What's in it for a founder when you could go get a job at Amagoobooksoft instead? That's a fair question. One: you will not have to work at Amagoobooksoft for a little while. Two: you may improve your eventual position at Amagoobooksoft by doing a startup versus simply applying to them today. Three: you may invent the next WhatsApp, and end up with several billion dollars in your pocket. Four: for a certain psychograph of developer, there are non-pecuniary advantages to running a startup in a manner similar to their being non-pecuniary advantages to doing the Peace Corps for some people. ("Change the world!") Five: You may, accurately or not, perceive that you are presently not likely to receive an offer at Amagoobooksoft, but accurately perceive that "Nobody can tell me I'm not ready to do a startup" and rationally calculate that this is a better way to build skills and reputational capital than e.g. getting a job at Burger King even if the money is roughly similar.

P.S. The Mobifotosocialgames For White And Asian Geeks space is a small fraction of the total market for software, though you wouldn't know it from "the tech scene."

Re: Ask HN: Is there an over supply of tech products and services?

#8

Post by masslessness »

patio11 wrote: post #6

There's only so many consumer eyeballs and wallets in the world, it almost seems the supply of products and services is unimaginably over supplied to a fixed demand? Are you of the impression that the demand for, I don't know, B2C cell phone apps is fixed in 2014 to the same value it was in 2007? If you (sensibly) do not agree that the iPhone failed to change the underlying demand for cell phone applications, conside…

So sure, the demand in and of itself is growing, but it's in contrast to the huge supply that it seems almost fixed.

Regards "the tech scene's" narrow focus, what kind of software does the rest of the world need? I mean what problems can software really solve? And to get a better understanding of how we as developers can do anything about it, what is it exactly about software that allows it to do that?

Re: Ask HN: Is there an over supply of tech products and services?

#9

Post by projectramo »

Technology improves existing products and services; its like a multiplier. Technology reduces cognitive load in interacting with a service, improves immediacy and responsiveness and so on. There is an over supply of "tech" products and services if there is an over supply of quality in products and services.

For example, do you think of Uber and AirBnB as two tech products? Or do you think of Uber as brokering (and therefore improving) transportation availability using tech and AirBnB improving housing availability using tech? After Uber was created, AirBnB wasn't an additive "tech" company.

So its not the "tech" part that is key to a company's redundancy but the "goods and services" part.

Re: Ask HN: Is there an over supply of tech products and services?

#10

Post by api »

It's an innovative market, which means people are trying a lot of things. Given that, there's always going to be an "oversupply" of things that don't work or don't solve a problem anyone really cares about. The only time you don't see such an oversupply is in a market where nobody is trying anything new... such as automobiles from about 1960-1970 until the 2000s (hybrids).

No errors means no trial is happening.

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