I understand this but I think the biggest driver for software salaries is the sheer number of companies that are interested in hiring software engineers. Plenty of hardware companies are very profitable but do not raise their salaries because there is no market pressure to do so as the more limited job market means EEs/embedded engineers do not switch companies nearly as frequently and switching companies is generally the best way to get a substantial salary increase.
Which hardware companies have SaaS margins? I think 10% margin is very good for a hardware company. A software company would aim for multiple times that.
