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"In fact, when I became chairman of Sega in 1997, I said we should stop producing hardware".
American computer makers, adept at producing hardware on thin margins by building sophisticated global supply chains, could also develop competing products, turning television into just another function of the home computer.
Chinese Internet companies are entering the competition by expanding their businesses into producing hardware.
If ever there was a case of a startup demonstrating the kind of hurdles involved with producing hardware, it's WakeMate.
That will dramatically lower the cost of producing hardware, and it offers all sorts of new pricing and business models on top of its service.
The majority of the tenants are knowledge- and technology-intensive firms, developing or producing hardware (e.g., oil and chemical spill recovery systems) or software products (e.g., mobile applications or web-based tools).
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The company, Silver Spring Networks, produces hardware and software to make the electricity grid more efficient.
Mr. Eplboim also said he likes Nice Systems Ltd., which produces hardware and software used by corporations and law enforcement agencies to record and monitor phone calls.
"He'd probably go, 'Wow, everything is still the same,' " said Ms. Magnuson, the director of marketing for Silver Spring Networks, which produces hardware and software to make the electric grid as smart as the phone network.
Both Sony and Microsoft have to produce hardware that will inspire developers as well as impress consumers: this is a much more complicated industry now; consoles are having to compete for development support with a whole host of devices – we're seeing a huge migration of small and mid-sized studios to PC and smartphone.
Pursuing new revenue streams outside of their usual markets, firms like Google, Apple, and Uber, along with well-heeled venture capitalists, poured hundreds of billions of dollars into partnerships and internal design teams to produce hardware and software for self-driving electric cars.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com