The Race to be First: Does it Matter?

One of the popular discussions in the autonomous vehicle community is which company will be first to have their self-driving cars on the road. The countless news articles on the topic of self driving cars always include a blurb about which companies are closest. The ever-changing timeline of when we’ll see these cars on the road continues to keep the media interested, even if at this point there is a credible source claiming seemingly every possible scenario as the most likely path towards autonomy. I wanted to look this race to adoption from the perspective of the manufacturers and then hopefully get a clear answer to whether who gets there first is as important as the media would like us to believe. Is the so-called race a classic case of modern media sensationalism or is it actually a relevant factor in the development of autonomous vehicles?

Let’s first take a look at some of the reasons why being first could actually be an important achievement for whichever company can get there. A study conducted by AlixPartners LLC, a consulting company in Michigan, observed that out of the 50 or so companies that are currently developing autonomous driving software and equipment, only a few will emerge as “winners.” Many of the high profile mergers we’ve seen in the AV industry, such as that between nuTonomy and Delphi, highlights the trend toward fewer individual companies maintaining relevance. As companies join forces, they become better positioned to beat out the competition and achieve the evasive title of first to get their products on the road. But what does it even mean to be first? According to John Hoffecker, the vice chairman of AlixPartners, “The companies are all racing to be first so they can set the standard for autonomous automobiles much like Tesla Inc. has established itself as the premier name in electric cars. Those who lose out won’t die off, especially the established car companies. But they’ll be racing to catch up in self-driving technology after having invested a lot of cash in the race to be first and likely will have to buy technology from the winners[1].”

The allure of being first, then, is the ability to be the standard setter. In fact, this is so enticing that we have recently seen the competition intensify to new heights. A case study for this growing animosity is the tense relationship between Uber and Waymo, two leaders in the AV realm. Earlier this year, there was a high-profile lawsuit where Waymo sued Uber over the stealing of trade secrets[2]. The scandal centered around one person in particular, Anthony Levandowski, who is an important figure in self-driving car development.

Anthony Levandowski

Since his freshman year of college, Levandowski’s life mission has been to create the first self-driving car and he has been involved in many of the most prominent groups working toward that goal including the DARPA races in the early 2000s, autonomous truck company Otto, and crucially both Google’s Waymo division as well as Uber. After leaving Google in January 2016, Mr. Levandowski formed the self-driving truck company Otto. About six months later, Uber bought Otto for $680 million, and Mr. Levandowski became Uber’s vice president in charge of its self-driving car project[3].  Waymo filed a lawsuit in federal court against Uber and Otto, accusing Mr. Levandowski and Uber of planning to steal trade secrets. The suit said Mr. Levandowski retrieved information from a highly confidential server with designs of crucial technologies used in its autonomous vehicles in the month before he resigned from Google, where he had spent nine years working on maps and self-driving cars. The ruling of the case stated that Levandowski is now barred from working on autonomous cars for Uber. In a way this outcome is lucky for Uber given that their entire self-driving car division was at risk of being legally terminated. At the same time, given the video below, Waymo’s lawsuit may be less of a problem then its own engineering.

The judge also found that the documents Levandowski stole were not so much trade secrets as fairly standard engineering strategies. The judge wrote of these documents, “General approaches dictated by well-known principles of physics, however, are not ‘secret,’ since they consist essentially of general engineering principles that are simply part of the intellectual equipment of technical employees[4].” Given the massive and public lawsuit that came out of these documents that in the end were not as valuable as Waymo originally suggested, it is clear that these companies are willing to go to extreme lengths to burden their competitors.

The ruthless competition between Waymo and Uber shows just how far individuals and companies are willing to go to get their products on the road first. But does this race really matter in the long term? When I first started pondering this question and its importance to the field overall, I was confused. I did not see why it mattered which car was first because eventually, all cars would be autonomous and there would be no way for one manufacturer to saturate the industry, at least assuming that other companies would be able to catch up and release competitive products. I thought about other related industries for frame of reference and observed the first company did not subsequently dominate the industry. Ford was the first mass production auto manufacturer, and while they are still a titan in the industry, they are by no means a monopoly. Now 100 years down the line, the Model T did not position Ford as the only company with the ability to produce cars.

Cars have come a long way since the Model T shown above

The same happened with the smartphone. Apple’s iPhone was the first smart phone of its kind and came to define the segment, but now 10 years after its launch there are numerous competitors like Samsung and Google that have prevented Apple from cornering the market. Applying these examples to self-driving cars, I can see how the first manufacturer to get their product on the road will be able to establish public perceptions and set the standard of what people expect in a self driving car. At the same time, competitors are given the privilege of having a frame of reference in place before they release their product, giving them an advantage in a sense. All in all there is no way to tell just how important being first will be, just as there is no way to tell when we will see AVs on the road. It seems then that the value of being first to market is yet another of the mysteries that surrounds the blossoming self-driving car industry.





2 thoughts on “The Race to be First: Does it Matter?

  1. I think that your comparison to the smartphone market is spot on. The first company to bring self-driving cars to the masses won’t necessarily be the most successful in my mind. As you said, it is all about user trust. Take for example my grandma, she was so against the idea of using smartphones and computers.

    She only came around after I gave her my old iPhone 3G. She was excited that she could navigate the interface freely. It was easy. She trusted it. Apple certainly didn’t have the first smartphone, but their goal was to make it sharp, clean, usable.

    I think the same concept applies directly to autonomous vehicles. The most successful company is going to be the one that creates the most seamless experience from inside and outside the car.

    Last week when we saw the video of Toyota’s primitive AI combined with their autonomous vehicle concept, I couldn’t help but think, “wow, this is a fantastic idea.” Because to be honest humanizing an autonomous car is going to be able to earn the trust of consumers in a whole new way.

    Goodbye, Uncanny Valley.

  2. Extremely thought provoking article! The race to have first mover advantage is always interesting no matter the industry, and seemingly never fails to create interesting case studies to examine where certain companies inevitably go wrong.

    One of my favorite cases to look back on is that of Opentable. When they first launched there were about 20 competitors vying for market share, but, because Opentable’s platform focused on optimizing the customer UI it was the one to succeed.

    There is an interesting parallel between Opentable and the AV industry as companies will be and are vying for the trust of new users. Whatever tools can be used to lower the cost of compliance with this new technology, especially surrounding their user interfaces could play a large role in determining which companies will ultimately succeed and which will inevitably fail in this venture.

    However, it seems as though there will be an interesting dynamic when it comes to the “first mover” in the AV market as the technology may be waiting for governments approval evening the playing field from the word go.

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