The battle for your next dollar will be fought with software

Hardware innovation in the gadgets you buy is dead. Well, it's not really dead, but it seems that way, and it's not going to change in the next few years.

There are important changes in the bits inside things like our phones. Things you probably can't see or when you hear about them you'll respond with a shrug if anything. Powerful co-processors and dedicated NPUs just aren't very sexy to regular folks like us who buy this stuff.

Fancy new chips from Qualcomm or Apple and faster memory are important though, because they power the big changes we can see; new features and improvements to all the software that powers our favorite tech toys will be the thing that makes us want to buy them.

This isn't anything new. Software changes have long been a big selling point when some executive stands on a stage to tell you why their product is the best. What's going to change is the pace and scale of these changes, while the devices that provide them seem to be unchanged .

A lot of folks aren't going to be happy about this. Expect to see headlines from the tech press saying that the next device from Apple, Samsung, or Google will be just like the last device—especially when some of the software changes will work their way back to the older models.

That doesn't mean a lot, though. The only reason to buy an older model of something like a phone or watch is to save money (it's also a really good reason ). The Galaxy Watch 7 is a big improvement over the Galaxy Watch 6 (for example) in every measurable way, even if it looks mostly the same on the outside. These improvements will show themselves when it comes to those software features designed to make them something we want to buy because they will work better. A lot better.

You already know why. It's that stupid little thing called AI that companies want to cram into everything because they feel like it will make us want gadgets even more than we do now. Even the most mundane things, like your phone's home screen wallpaper, have AI forcibly injected into them.

This sort of thing needs better hardware to grow, but it's not hardware that seems like a showcase feature. Look at the latest processors from Apple or Qualcomm to see what I'm saying. Yes, they are XX% faster and will supposedly get XX% better battery life because those are improvements we see every year, even when a chip isn't great.

The big changes, and what makes these new components important, are the ways they can handle the copious amount of AI processing the devices using them will require. Everything from phones to smart doorbells are now miniature factories of AI software. All of them need better hardware under the hood, working in ways nobody cares about.

We should probably be excited about all of this. It's easy to get burnt out by "AI Everywhere" when all the tech companies are using it in all the things. But this will lead to that next big thing when it comes to the features we want. It simply needs a smart team to dream them up and develop them.

This will last for a few years, and then we'll go back to seeing phones that seem all new and different each year. Until then, expect the Galaxy S25 , Pixel 9 , and iPhone 16 to be a lot like the Galaxy S24 , Pixel 8 , and iPhone 15 on the outside unless you count a different-shaped camera bump or a new color. Give them a few months, though, and we'll see where the real changes are and why we should (or shouldn't) want to buy them.