Software-Defined: Buzzword Bingo or Real Deal?

According to a recent IDTechEx report, connected and software-defined vehicles (SDVs) represent a new paradigm for automakers and consumers. The research team forecasts a 35% CAGR in automotive software-related revenue by 2034, reaching over $700 billion.

SDVs are just the tip of the iceberg. Software-defined everything will be everywhere. But it isn’t some newfangled stuff. 

Software-defined radio (SDR), which uses reconfigurable software-based components to process and convert digital signals, was coined in 1995. Meanwhile, software-defined networking (SDN) was proposed at Stanford University in 2008 and started to make its way into the IT industry in 2011. That was 13 years ago.

Software-defined storage balances I/O resources based on workloads, data signatures, or times of day; Software-defined computers perform proactive workload and predictive resource balancing; Software-defined data centers utilize local and cloud resources interchangeably to maximize availability and profits. 

So, is the software-defined trend the new buzzword on the block that will go the way of, like, Dogecoin? Or is it here to stay and change the world?

What does software-defined really mean?

Software-defined represents products where the software, rather than the hardware, does the magic to deliver the solution. A software-defined product is purpose-built hardware. Its physical functions can be substantially altered by the software running it. You can change its behaviors or expand its capabilities simply by changing a parameter or sending a software update (often over the air).

The software also analyzes data generated by the hardware in real time. It applies the insights to automatically adjust the equipment’s behaviors to optimize anything from performance and resource usage to cost-saving and hardware longevity.

So, how does it differ from a computer? 

A computing device like a laptop, tablet, or smartphone is a general-purpose number-crunching device with a user interface and a network interface. From TikTok and Tinder to Amazon and Spotify, you can do almost anything with that black rectangle in your hand.

On the other hand, software-defined equipment performs a much narrower set of tasks. An SDV still performs as a vehicle. A software-defined battery (SDB) still works like a battery. You can change how an SDV behaves, but it still rolls on four wheels and takes you from point A to point B.

Why are software-defined technologies important?

Software-defined technology enables the creation of better and cheaper products through commoditization. It also allows companies to implement fixes and enhancement post-production and post-sale with virtually no added costs. Let’s delve into these benefits.

Better and cheaper products through commoditization

Manufacturers can use software to define a product’s features and functionalities. They can build fewer hardware versions and tune their behaviors with software. 

Companies that provide cellular infrastructure were the trailblazers: Instead of making different gear to support multiple national versions, they produce one or a few and ship them with “Japan,”“Europe,” or “North America” software. It’s also possible to support a new standard or protocol that didn’t exist when the equipment was purchased or installed.

Another example is software-defined batteries. You can program SDBs to output a broad range of voltages. Instead of redesigning a battery pack when you need to support a new application with a higher or lower voltage requirement, you can take an existing universal pack and reprogram it via software. 

Continuous optimization through software upgrades

Fixes and enhancement are par for the course in today’s agile business environment, where the iterative approach drives most design and development processes. However, it’s challenging to implement many of these principles in hardware design if you can’t update a product once it leaves the factory without substantial costs. Software-defined technologies will change that. 

When U.S. safety regulators forced Tesla to issue a safety recall to fix a defective autopilot steering system for nearly all of its two million vehicles sold, the company essentially shrugged and pushed out a software update over the air. All vehicles were brought into compliance overnight without anyone going to the dealer — avoiding the costs and inconvenience while limiting the reputation damage of a recall. Crisis averted. 

Sounds good. What’s the catch?

Like the internet and AI, the increased adoption of software-defined technologies will come with some ambiguity and challenges as society grapples with its implications.

For example, BMW has been experimenting with subscription business models for optional features like heated seats. They argue that they can make the cars cheaper by not asking people to pay for all the features up front. Instead, users can choose what features to enable post-sale through a monthly charge or one-time fee.

Yet, BMW also claims that installing the hardware in all the cars lowers costs. So, if you buy a BMW with the equipment to warm your bum but without the software component to turn it on… Does BMW own the hardware and lease you “warm bum service?” Do you own both, and hacking is fair game, even if it’s against the terms of service?

Then, we have the security problem. You can update and command software-defined equipment over the air, which means threat actors can also hack your equipment without being anywhere close. Product builders and designers must consider the access management and cryptographic aspects before widespread adoption is possible.  

Software-defined everything is the future

Some companies have been diligently building software-defined products and never worried about how trendy they may become. They did it because it was the right tool to do the job. These pioneers have shown time and again that the approach works. 

Now, the world is catching up.

Plus, the technology makes economic sense. It lowers costs and reduces resource usage for everyone involved. Meanwhile, scaling a software business is much easier than scaling a hardware one — making the business case attractive for both companies and investors. 

The line between software and hardware is blurring. Software-defined technologies are here to stay, and their development will accelerate.