You're kind of both right IMO. The great majority of products created by techies interested in startups are priced much lower than the market will bear, and so

You're kind of both right IMO. The great majority of products created by techies interested in startups are priced much lower than the market will bear, and so their prices should rise. There definitely is a market out there for the cheapest possible version of something. Usually, turning a profit while moving a product at the cheapest possible price involves maximizing volume, cutting quality to be bare minimum, and ruthlessly eliminating overhead. Like, if there aren't thousands of people on the internet complaining about how crappy your quality is, you probably need to cut it further. I haven't studied it, but I have a hunch that most of the type of people who surf HN for business advice aren't interested in being in a commodity industry where you have to do these things to have a viable business. Or if they find themselves in one, they aren't going to be ruthless enough in the right directions to make it. They better find the right place to get advice for that sort of business, or they won't last long.