I think his point was that it is hard to keep a company going making just the hardware. The margins are low, and customers only have to pay you once, to get the hardware.
It is hard to make a lasting business off that, which is why everyone wants to do subscription services.
It used to be the only way to make business in not so long past. People made money selling products just fine.
Maybe it's because people trying to get rich quick playing the VC lottery are sucking the oxygen out for people who want to just do a honest to God, "payment in exchange for providing value" type of business.
It is hard to make a lasting business off that, which is why everyone wants to do subscription services.