I agree with you when you say "Its all about the product", and even the VB author does ("No one can make money selling hardware anymore. The only way to make money with hardware is to sell something else and get consumers to pay for the whole device and experience"). That term "experience" encapsulates a lot of what you talk about in your article.
Both, the VB author and you actually talk about the same thing. You somehow dont see it that way.
Focusing on just the physical 'product' and not taking into account everything that fits into the above definition will leave customers with a poor overall experience.
Please send me the name and contact of the dev shop you are using.
I see things like 'moocow01: free duplication isn't the same thing as it costing $0 to manufacture software. Software is "manufactured" almost exclusively on a one-off basis.
However, there are still similarities. New languages, frameworks, tools, etc, basically do the same thing to software as the $35 tablet represents in hardware. There are a lot of new tools in the past five or ten years that will let you quickly create something that's now seen as basic, but would've taken much more work to duplicate in the past.