That's a very one dimensional analysis there Distant Star. I'm sure the tech utopians have all that set in place for their master plan, but it's not that simple.
We've had "blending" of devices and services, in fact we have it now. People in general don't really like it so much. Also, you're forgetting Apple and Nintendo, which are integrated hardware and software companies. The integration of both is something very important, that the consumer loves and I believe will come to appreciate increasingly.
You can't do a software utopia just because it sounds good on paper, the consumer is always king.