The world could run on older hardware if software optimization was a priority

There is an argument to be made that the market buys bug-filled, inefficient software about as well as it buys pristine software. And one of them is the cheapest software you could make.

It's similar to the "Market for Lemons" story. In short, the market sells as if all goods were high-quality but underhandedly reduces the quality to reduce marginal costs. The buyer cannot differentiate between high and low-quality goods before buying, so the demand for high and low-quality goods is artificially even. The cause is asymmetric information.

This is already true and will become increasingly more true for AI. The user cannot differentiate between sophisticated machine learning applications and a washing machine spin cycle calling itself AI. The AI label itself commands a price premium. The user overpays significantly for a washing machine[0].

It's fundamentally the same thing when a buyer overpays for crap software, thinking it's designed and written by technologists and experts. But IC1-3s write 99% of software, and the 1 QA guy in 99% of tech companies is the sole measure to improve quality beyond "meets acceptance criteria". Occasionally, a flock of interns will perform an "LGTM" incantation in hopes of improving the software, but even that is rarely done.

[0] https://www.lg.com/uk/lg-experience/inspiration/lg-ai-wash-e...

The dumbest and most obvious of realizations finally dawned on me after trying to build a software startup that was based on quality differentiation. We were sure that a better product would win people over and lead to viral success. It didn’t. Things grew, but so slowly that we ran out of money after a few years before reaching break even.

What I realized is that lower costs, and therefore lower quality, are a competitive advantage in a competitive market. Duh. I’m sure I knew and said that in college and for years before my own startup attempt, but this time I really felt it in my bones. It suddenly made me realize exactly why everything in the market is mediocre, and why high quality things always get worse when they get more popular. Pressure to reduce costs grows with the scale of a product. Duh. People want cheap, so if you sell something people want, someone will make it for less by cutting “costs” (quality). Duh. What companies do is pay the minimum they need in order to stay alive & profitable. I don’t mean it never happens, sometimes people get excited and spend for short bursts, young companies often try to make high quality stuff, but eventually there will be an inevitable slide toward minimal spending.

There’s probably another name for this, it’s not quite the Market for Lemons idea. I don’t think this leads to market collapse, I think it just leads to stable mediocrity everywhere, and that’s what we have.

My wife has a perfume business. She makes really high quality extrait de parfums [1] with expensive materials and great formulations. But the market is flooded with eau de parfums -- which are far more diluted than a extrait -- using cheaper ingredients, selling for about the same price. We've had so many conversations about whether she should dilute everything like the other companies do, but you lose so much of the beauty of the fragrance when you do that. She really doesn't want to go the route of mediocrity, but that does seem to be what the market demands.

[1] https://studiotanais.com/

> But the market is flooded with eau de parfums -- which are far more diluted than a extrait -- using cheaper ingredients, selling for about the same price.

Has she tried raising prices? To signal that her product is highly quality and thus more expensive than her competition?