These are just engineering tradeoffs. Sure you need to weigh them carefully, but the fact that we spend more on software than hardware does not indicate a horrible failure in the industry.

For example, processing power, communication speed, and storage has improved by orders of magnitude, but battery capacity is perhaps better by one factor of ten. Much of the advance in battery life comes from reduced power consumption by other components. Much of the advance in software development has come by creating inefficient abstractions that let us create things faster but squander CPU, network, and battery life.

Most companies today are willing to burn up some hardware performance in order to reduce software development time. If they're burning too much, they'll fix it or they'll go out of business. Premature optimization is still not a good idea.