Part of the Hardware glossary:

A commodity is a type of widely-available product that is not markedly dissimilar from one unit to another.

Within a category of commodity, one item or unit can be substituted for another with similar results. Examples of commodities, in the traditional sense, include sugar, wheat, rubber, fuel oil, cattle, gold, aluminum and wool – among a great number of other products. Other products, such as wind and solar power and greenhouse gas offsets are considered to be emerging commodities, for which the market is developing but not yet mature.

By definition, a commodity product lacks a unique selling point. In an IT context, the term usually differentiates typical consumer products from specialized or high-performance products. A commodity, in this context, is a low-end but functional product without distinctive features.  A commodity computer, for example, is a standard-issue PC that is widely available for purchase. 

As technologies and markets for a given product mature, it is more likely to be considered a commodity, at least in its more basic implementations.  According to some market analysts, the increasing ubiquity of smartphones and the consistency of features from one brand to another means that the products are becoming commodities.

This was last updated in September 2013
Contributor(s): Ivy Wigmore
Posted by: Margaret Rouse

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