Tag: autonomous vehicles

• Young people are driving a lot less

  As a kid growing up in the suburbs, I got my driver’s license the day I turned 16. Being able to drive was a big deal. But we know that this desire to drive has been changing in profound ways. Here’s some recent stats on the percentage of licensed drivers in the US by age (taken from the WSJ):

  

  In 1983, about 46% of 16-year-olds had a driver’s license. By 2014, this number had dropped to 24.5%, which is the lowest it has been in recent years, and was probably impacted by the broader economy. As of 2017, this number was up to about 26%.

  If you’re a car company, I would imagine that these are pretty important numbers. They represent the top of the sales funnel. Most people probably like to have a driver’s license in hand before they go out and buy a car.

  Supposedly, some people in Detroit are betting that young people will still eventually buy a car. And when they do, it’ll be a nice big one like an SUV or a truck. But, the data suggests that it is not just young people who are eschewing driving.

  Here’s some data from the University of Michigan Transportation Research Institute (via NPR), looking at the proportion of licensed drivers in the US by all age categories:

  

  While the biggest drop has certainly happened among younger generations, licensing is still down for older cohorts. Based on these numbers, we don’t hit parity until somewhere around 50 to 54 years old.

  And the only cohorts where licensing has increased significantly are when people reach over 55. Over 70 is up by a huge margin — more than the drop among 16 year olds — which is probably a symptom of people living longer.

  Some of this decrease among young people can probably be attributed to delayed family formation and people living in denser urban environments, where it is more convenient to get around without a car. But I don’t think that’s all of it.

  Which suggests to me that the race to autonomy is a pretty important one to win.

  2019.04.21

• Liquidity network effect

  Uber filed its S-1 last week in anticipation of going public in May. The WSJ reported on it, here. These are always interesting documents because you get access to previously private information. Here we can see that Uber’s ride-hailing market share in the US is down to 67% (as of February 2019) from 78% two years earlier. Revenue from this business line — which is the company’s biggest — also seems to have levelled off (chart from the WSJ):

  

  The ride-hailing business today has become a commodity. A lot of people, myself included, simply check to see which service is the cheapest (usually it’s Uber vs. Lyft). So this space feels to me like a giant race to build the biggest network and get to something new, whether that be autonomous vehicles or delivery drones. Uber calls this creating a “liquidity network effect.” Here’s an excerpt from the S-1:

  We have a massive, efficient, and intelligent network consisting of tens of millions of Drivers, consumers, restaurants, shippers, carriers, and dockless e-bikes and e-scooters, as well as underlying data, technology, and shared infrastructure. Our network becomes smarter with every trip. In over 700 cities around the world, our network powers movement at the touch of a button for millions, and we hope eventually billions, of people. We have massive network scale and liquidity, with 1.5 billion Trips and an average wait time of five minutes for a rider to be picked up by a Driver in the quarter ended December 31, 2018. Every node we add to our network increases liquidity, and we intend to continue to add more Drivers, consumers, restaurants, shippers, carriers, and dockless e-bikes and e-scooters. We also hope to add autonomous vehicles, delivery drones, and vertical takeoff and landing vehicles to our network, along with other future innovations. Our strategy is to create the largest network in each market so that we can have the greatest liquidity network effect, which we believe leads to a margin advantage.

  If you’d like to download a full copy of their filing, click here.

  2019.04.14

• Mobility at CES

  CES is underway right now in Las Vegas. About 200,000 people are in attendance. 

  Since tech and mobility are today closely intertwined, the show has become an important platform for the automative industry.

  Here is a video showcasing BMW’s new iNext concept (expected by 2021):

  [youtube https://www.youtube.com/watch?v=x9-f3cALABk&w=560&h=315]

  It is based on level 3 autonomy, which means the car will do mostly everything, but you need to be ready to take over at any time.

  The video is interesting because it begins to show you what becomes possible when you no longer need to pay attention to the road. It is a bit like flying (but hopefully more enjoyable). 

  And here is a video of Bell’s new urban air taxi, which is called Nexus (expected by the mid-2020s):

  [youtube https://www.youtube.com/watch?v=1o4d8N-A1G8&w=560&h=315]

  This is the company’s first concept. But they’ve been working with Uber since 2017 to develop a network of flying taxis for cities.

  Finally, flying cars.

  2019.01.10

• iPhone as a Service

  At the beginning of this year – January 2nd to be exact – Apple revised its earnings guidance, downward. It was the first time in 15 years that the company had to do this. 

  Tim Cook’s letter to shareholders, which can be found here, focuses a lot on China and its “economic deceleration.” But M.G. Siegler of 500ish Words believes that a greater pivot could be underway. His piece can be found here. It’s a good read.

  Firstly, Apple’s current growth period is probably over. And secondly, the company is likely going to need to diversify away from high margin hardware/software sales and continue to grow its Services business (something that Microsoft has, ironically, already done).

  Here is an excerpt from M.G. Siegler’s essay (Apple’s Precarious and Pivotal 2019):

  The iPhone has simply been too good of a business. And it’s hard to see what tops it. Certainly in the near term. If Services is to carry Apple in the future, it will likely be only after years of relatively stagnant iPhone revenue growth mixed with a rising overall market. In other words, time and the broader world will have to catch up. And then Apple can have their “Microsoft Moment” — a services-based resurrection of growth.

  As Tim points out in his letter, most of Apple’s Services revenue is tied to its installed base, as opposed to current period sales (also: less exposure to China). Last quarter that number was $10.8 billion – a new record.

  So what we may see in the near future is the end of outright phone purchases and instead some sort of iPhone as a Service (or iPaaS). Pay Apple every month in perpetuity; always have the latest iPhone.

  Of course, Apple has many other irons in the fire. Apple Watch has turned out to be a big business and the company is said to have 2,700 “core employees” working on its autonomous driving project. 

  Maybe some of these businesses will also end up as Services.

  2019.01.07

• Documenting a city

  Starting in the late 1930s, New York City began hiring photographers to document each and every building in the city. It did this to improve the accuracy of its tax assessments, and so every photo was taken with a sign board indicating the building’s block and lot number. The photos looked like this (taken from here):

  

  The initiative produced over 700,000 black and white photos, all of which have been recently digitized according to the New York Times. The Times also recently published this interactive piece where they go back to these archival photos to see how the city has and hasn’t changed. 

  In the late 1930s and early 1940s, documenting a city and its buildings was clearly a manual endeavor. Today we have Google Street View (launched in 2007), which has now photographed much of the world. Many countries, including all of North America, are reported as having “mostly full coverage.”

  But already autonomous vehicles (and their supporting services) are starting to scan and map our cities in new ways. So it will be interesting to see what ends up getting built on top of this data. I am certain it will empower much more than just better tax assessments.

  Happy New Year, friends. Thanks for reading over the last year.

  2018.12.31

• A decentralizing or centralizing force?

  I was on two panel discussions over the last week and, as is the case with all real estate panels, the topic of parking invariably came up, as did the impact of autonomous vehicles.

  There seems to be a general consensus that the advent of driverless cars will result in less demand for parking. Every developer I know is trying to build as little parking as possible and is thinking about how – when the time comes – they might convert their parking into something more productive. I have yet to speak to anyone who is building excess parking in order to prepare for autonomy.

  Where there’s a split, however, is whether autonomous vehicles will represent a decentralizing or a centralizing force for our cities. Historically, new technologies have lowered transportation costs and encouraged decentralization. Before the advent of rail, the US population hugged the coasts, because it was cheaper to navigate across the Atlantic than it was to move inland.

  A similar phenomenon also played out with our streetcar suburbs and with our car-oriented suburbs. These new technologies made it possible for people to travel further distances in order to get to work and other places. So it is not at all surprising that many people today are inferring that autonomous vehicles will produce this same outcome.

  But there is a counterargument. 

  We know that the demand for transportation services is highly elastic. Uber and other ride sharing apps have demonstrated this to us. Lower fares translate into dramatic increases in demand. So the opposing argument is that as the cost per kilometer drops – autonomous electric vehicles are going to be much more cost effective to operate – we’re going to see boatloads of induced demand.

  This induced demand will then force us to look toward road pricing and other demand management tools in order to cope, which then begs the question: How much cheaper and more convenient will autonomous vehicles really be? 

  At the same time, it is important to acknowledge that autonomous vehicles should correct many of the inefficiencies currently caused by humans acting like humans. There is also the opportunity to operate these autonomous vehicles more like public transit than as personal vehicles. And that will have a profound impact on urban mobility.

  Still, it is not yet clear, at least for me, that autonomous vehicles will be the decentralizing force that many assume they will be.

  2018.11.21

• A moral compass for autonomous vehicles

  One of the challenges that self-driving vehicles present is not about technology per se, it is about ethics. The typical example scenario is this one: If a pedestrian were to step out in front of an autonomous vehicle illegally, should the car be programmed to hit the pedestrian or veer off the road at the risk of potentially harming its passengers?

  I believe that self-driving vehicles will ultimately result in fewer accidents. Statistically they will be safer. But self-driving vehicles, particularly early on, are going to get a lot of attention when they do get into accidents, even if they are still safer as a whole. And that’s because they will make for good headlines.

  Safety and statistics aside, in turns out that the answer to the above moral question could depend on where you’re from. Nature recently published what they are calling the largest ever survey of “machine ethics.” And out of this survey they discovered some pretty distinct regional variations across the 130 different countries that responded.

  The responses were able to be grouped into 3 main buckets: Western, Eastern, and Southern. Here is the moral compass that was published in Nature:

  

  And here are a few examples. In North America and in some European countries where Christianity has historically dominated, there was a preference to sacrifice older lives for younger ones. So that would guide how one might program the car for the case in which a pedestrian steps out in front.

  In countries with strong government institutions, such as Japan and Finland, people were more likely to say that the pedestrian – who, remember, stepped out onto the road illegally – should be hit. Whereas countries with a high level of income inequality, often chose to kill poorer people in order to save richer people. Colombia, for example, responded this way.

  Also interesting is the ethical paradox that this discussion raises. Throughout the survey, many people responded by saying that, in our example here, the pedestrian should be saved at the expense of the passengers. But they also responded by saying that they would never ever buy a car that would do this. Their safety comes first in the buying decision. And I can see that.

  There’s an argument that these are fairly low probability scenarios. I mean, the last time you swerved your car, you probably weren’t driving on the edge of a cliff where any deviation from the path meant you would tumble to your death. But I still think that these are infinitely interesting questions that will need to be answered. And perhaps the answer will depend on which city you’re in.

  2018.10.28

• Uber to invest $200 million in Toronto

  Uber CEO Dara Khosrowshahi was in Toronto today, where he announced that the company plans to invest more than $200 million over the next five years to expand the autonomous vehicle research lab that it already has here in the city. 

  The Toronto outpost of Uber’s Advanced Technologies Group (ATG) – which is its only international outpost – is led by renowned University of Toronto professor, Raquel Urtasun. She is also the cofounder of the Vector Institute for Artificial Intelligence and splits her time between Uber and UofT.

  With this investment, Uber also expects to open its first engineering facility in Canada and grow its local headcount to 500, up from the 200 or so it has today. Some of these hires will be local. Some will be international. And some will be transplants from Uber’s other offices.

  Also notable about the announcement is that Khosrowshahi mentioned that he thinks fully autonomous vehicles roaming the streets of our cities is a good 10 years away. But I wonder if that isn’t political PR speak intended not to spook its drivers. So are we closer to the mid-2020′s?

  Either way, as a proud Torontonian and UofT alumnus, I was happy to see this announcement. I think it’s far more exciting than the Apple event that took place earlier this week.

  2018.09.14

• Is Tesla the new iPhone?

  

  Benedict Evans just published a great post on his blog about “Tesla, software and disruption.” I recommend a full read. In it, he tries to answer whether Tesla is really “the new iPhone” and if it will be as disruptive to the car landscape as some/many people think.

  In his line of thinking, electric (as opposed to an ICE vehicle) feels a lot more like a sustaining innovation, rather than a disruptive innovation. In other words, it something that incumbents will be able to incorporate. So it will not change the “basis of competition.”

  The more critical aspect is instead autonomy. Here are two snippets from the piece:

  All of this takes us to autonomy. Electric is compelling but will probably be a commodity, whereas Tesla’s improvements on top of electric may not be commodities but are not necessarily decisive. Autonomy changes the world in profound ways (I wrote about this here), and it’s a fundamentally new technology that doesn’t look at all like a commodity. And Tesla is doing this, too. Sort of.

  In this competition, Tesla’s thesis is that the data it can collect from its cars will give it a crucial advantage. The only reason that anyone is interested in autonomy today is that the emergence of machine learning (ML) in the last 5 years probably gives us a way to make it work. Machine learning, in turn, is about extracting patterns from large amounts of data, and then matching things against those patterns. So how much data do you have?
  

  But even if we are to all agree that autonomy is the “disruptive innovation”, it is not yet clear who will get there first. Maybe it is Tesla. Maybe it is Waymo. Regardless, many or most people seem to agree that it will arrive in 202x.

  Image: Tesla

  2018.09.02

• Street-level intelligence and analytics

  

  I discovered a company yesterday called CARMERA, which just raised a $20 million Series B funding round. They call themselves a “real-time, street-level intelligence platform” and their flagship product, called Autonomous Map, provides HD maps and real-time navigation data to autonomous vehicles. That’s the way AVs work. They need maps like CARMERA’s to function. Here is an overview of what is supposedly the largest AV taxi service in the world. It is a partnership between CARMERA and Voyage.

  One of the interesting things about this product is that it is cleverly powered through another one of their products: a free fleet monitoring tool for commercial operators. So fleet managers use this service to keep track of their actual human drivers and, at the same time, CARMERA uses the vehicles to collect the data it needs for its Autonomous Map. They call it “pro-sourcing” the data (a play on crowdsourcing).

  It is perhaps a good example of “single user utility.” The product you’re making often has to be valuable to a single user before scale is reached. In this case, Autonomous Map would be a hard sell without a critical mass of pro-sourced data. It solves the perennial chicken-and-egg problem when creating new marketplaces.

  Finally, I think many of you will be interested to know that CARMERA has also announced a partnership with the New York City Department of Transportation. As part of this, the company will be handing over the data they have on pedestrian density analytics and real-time construction detection events. Part of their mission is to “automate cities” and better street analytics will certainly help to open up a new world of city building possibilities.

  Photo by Yeshi Kangrang on Unsplash

  2018.08.25