Steve says "Software replaces hardware"

It seems to me that when hardware designers look at the success of the iPod, they see MP3 chip wrapped in a nice package. Apple doesn't see it like that; it looks at the iPod as one component of a complete system - iPod, iTunes and the iTunes store - most of which is implemented software, not hardware. Apple's design culture is very software centric - yet they design some of the highest margin "hardware" products in the business.

This is a quote from Steve Jobs taken from a Time article about the iPhone:

"When you need to dial, it shows you a keypad; when you need other buttons, the screen serves them up. When you want to watch a video, the buttons disappear. Suddenly, the interface isn't fixed and rigid, it's fluid and molten. Software replaces hardware."

I believe in this philosophy. Design should be software lead. Software technology is the best way to deal with complexity; hardware should be built to provide a platform for software.