What it is: Apple’s artificial intelligence researchers published a paper regarding Apple’s self-driving car initiative.
It’s easy to look ahead to the future. Netflix originally started as a business mailing DVDs back and forth to customers rs, but they knew eventually the future would be streaming video. Apple could see that the future was streaming video as well, which is why they refused to put Blu-ray disc drives in the Macintosh. Apple also saw the demise of the flop disk long before PC makers did. By simply imagining the future, you can avoid lots of problems clinging to the past like Kodak, Blockbuster Video, or Sears.
At one time, people rented tapes and then DVDs from Blockbuster Video. Redbox appeared with vending machines all over the city, which undercut Blockbuster Video’s prices and monopoly on video rentals. Now Redbox is dying from streaming video.
Using this as a baseline, it’s not hard to see what the future of self-driving cars will be. Uber is already looking towards a future where they won’t need to hire drivers any more. Instead, Uber will consist of self-driving cars that come to where you are and then take you where you need to go. From Uber’s point of view, this means self-driving cars will eliminate the need for paying drivers. The future of self-driving cars is inherently linked to ride-sharing services.
Competing in this market are technology companies like Google and Apple, and ride-sharing services like Uber and Lyft. There are also the car makers like Volvo and Ford experimenting with self-driving cars because everyone knows that’s the future. Out of the three competitors for the self-driving car market, someone has to make cars but chances are it won’t be the Big Three auto makers. Right now, their current business model depends on car sales and ride-sharing threatens to lower car ownership. The Big Three auto makers are also slow in shifting to clean energy cars like electric. While electricity still needs to be generated to run electric cars, electric cars don’t pollute.
With auto makers saddled with the past, they’ll likely get left behind in the self-driving car market as a bit player. That leaves the technology companies and the ride-sharing companies. They need each other because the technology companies can keep improving their self-driving technology while the ride-sharing services use them to create a fleet of taxis roaming the streets. Right now the ride-sharing services absolutely depend on the technology companies to hail cars using a smartphone, either Android or the iPhone. Beyond that, customers just want a car.
Now here’s where the competition heats up. The technology companies want to create the safest self-driving cars, but they also want to create an entertainment center inside that car. For example, if you subscribe to Apple Music, you’ll be able to link your smartphone to the self-driving car’s stereo to play your music through the car’s speakers. Most likely, whatever Apple offers, Google will copy and vice versa, but you can see how self-driving taxis will need to cater to both Android and the iPhone.
So who will literally be in the driver’s seat when self-driving taxis become a reality and commonplace? Believe it or not, it will probably be the ride-sharing services because they have the customers and know how to reach them. The technology companies want to get their technology on the road to gather more data and learn, but they don’t have access to the customers without the ride-sharing services. That means the ride-sharing services will be in control and the technology companies will simply make money a different way, such as by displaying ads with Google or providing a unique riding experience to convince you to buy Apple’s services like Apple Music.
The technology companies are replaceable. The ride-sharing companies are not. That means it’s likely ride-sharing companies will be much like the Android vs. iOS competition. IN the US this boils down to Lyft vs. Uber. In other parts of the world, there will likely be two rivals in the ride-sharing market as well. If one company dominates, they won’t have the incentive to compete, but if two or three compete, then service and prices will be better for everyone in much the same way that most countries have multiple cellular companies competing for customers.
So expect technology companies like Tesla, Google, and Apple to compete with self-driving car technology and ride-sharing services to compete with each other like Lyft vs. Uber. The current car makers? If Tesla can build their own cars without the help of the Big Three, then the Big Three auto makers have little future to control their own fate. The future is ride-sharing services and technology companies.