The pioneers of new technology must raise a lot of capital to create foundational infrastructure, which can lead to over-investment and speculative bubbles. When these bubbles burst, weak firms fail, and market power consolidates around industry leaders and their paradigms. Through this consolidation process, we can identify the common elements across applications and isolate them into standard, modular components that can be open-sourced or sold as individual services.
These abstractions make it easier to build more complex applications and enable a shift from capex-dominant to opex-driven cost structures that allow new products to launch faster and with lower startup costs.