Software is not really an industry though, it’s just sometimes grouped that way because it’s relatively new. The thing that makes margins low in general is commoditization and the relatively high COGS of physical materials and manufacturing costs. In pure software plays COGS is generally extremely low so there is no cost floor (hence freemium), but also the product can be literally any conceivable logic or data processing which means it can only be commoditized along more specific market lines.

Consider for example the forces driving Uber/Lyft margins vs Google/Facebook margins.