What Self-Driving Cars Mean for You
Editor's note: Self-driving cars are right around the corner.
As our friend and colleague Jeff Brown, editor of The Near Future Report, explained yesterday, the technology is rapidly improving.
Today's edition of our weekend Masters Series is the conclusion of an interview that originally appeared in the June 16 issue of Bonner & Partners Inner Circle. In it, Jeff tells Bonner & Partners editor at large Chris Lowe how self-driving cars will dramatically reshape our economy and our everyday lives...
What Self-Driving Cars Mean for You
An interview with Jeff Brown, editor, The Near Future Report
Chris Lowe: According to the recent census, about 4.5 million Americans describe themselves as "drivers" of some sort. They could be long-haul truck drivers, cab drivers, Uber drivers, delivery-truck drivers – you name it. Won't these jobs go up in smoke with the deployment of self-driving technology?
What do you say to folks who push back on all of this and say, "Driverless technology may be great news for Silicon Valley folks. But what does it mean for the millions of Americans who drive for a living?"
Jeff Brown: First, I'd say that the positive impact on society will be extraordinary – in particular, fewer unnecessary deaths.
I'd also tell them that their commuting costs will be about 80% lower. And that, as a result, they're going to have more free time to do things they enjoy – such as reading the news, taking a nap, talking to friends and family, and watching TV. They will also have the chance to catch up on work on their daily commute because they won't have to worry about driving.
Yes, jobs will be lost. But there will also be new job opportunities. I'll give you a couple of simple examples...
In the U.S., there are roughly 1.2 million truck drivers who own their own business and have financed the purchase of their truck. These drivers have always had a problem: They are legally able to drive only 11 hours a day. They bought an expensive asset, but they're not allowed to use it the entire time. Today, they can't use that vehicle when they're sleeping. But in a self-driving world, they will be able to use their vehicles 24 hours a day.
They will be able to lay down and take a nap in the back of the cab while their truck drives itself to its destination. They'll be able to rest. They'll be able to take care of personal things while the truck is getting where it needs to go.
It'll be like a commercial airplane. On a given journey, they'll probably be driving the vehicle just for those few minutes when they're setting off and when they're arriving at their destination. Other than that, the truck will take care of itself. This will allow drivers to use their asset in a more productive way. And they'll be able to pay back their financing over a matter of years rather than decades. That's 1.2 million Americans who are going to benefit hugely from this new leap in technology.
There will also be entirely new industries created as a result of self-driving technology. I mentioned one before: Companies that run fleets of shared autonomous vehicles – or SAVs. You will need people to manage those fleets. You'll need people to manage the logistics of rolling out the infrastructure that will be needed. Because you'll need to have new parking facilities developed just for these fleets of cars, which will need to be close to their customer bases. You'll also need people to maintain and clean the SAVs on a daily basis.
Chris: Are there companies out there that are already gearing up to provide these services?
Jeff: There's already a company in California called Tesloop that shuttles people back and forth in Tesla cars. It offers services between L.A. and Orange County, L.A. and San Diego, L.A. and Palm Springs, Orange County and San Diego, and Orange County and Palm Springs.
You can travel between these destinations in roughly the same time it takes to fly commercially. The Tesloop cars have humans in the driver's seat. But the drivers control the vehicle for only those few minutes of departure and arrival. For most of the journey, the Teslas are in autopilot mode.
This business model will evolve to a point where there won't be anyone in the driver's seat. This will make the journeys a lot cheaper because roughly 40% of the costs are associated with the driver.
And ride-share company Uber has said that its entire fleet will be self-driving by the year 2030. My personal opinion is that it will happen much sooner than that. But if Uber told the truth, it would have a big issue with their drivers.
Waymo is another name to watch. I believe it will develop this type of service in conjunction with a large car manufacturer – a Ford or a General Motors. Waymo will provide all the navigation and mapping technology it has been developing to a car manufacturer. And that manufacturer will deploy the technology.
Google will benefit because it will be able to apply the same model it has built its business on: advertising. The technology Waymo provides will deliver location-based advertising straight to your car. This will allow it to serve you ads that are contextually relevant based on where you are and the data that Google already have stored about your preferences.
Your car will tell you there is a restaurant close to you that you enjoy eating in or that a friend reviewed favorably. Or maybe Google knows you like sushi because you ordered a sushi cookbook recently. And your car will alert you to a good sushi restaurant nearby.
Chris: That's starting to sound a bit creepy.
Jeff: Remember that whatever self-driving car is carrying Waymo technology will be linked to your Google account. Google already knows where you live. It already knows every website you visit. It already knows a lot about what you buy online. The only difference will be that Google will now know where you are when you're in your car.
For instance, let's say Google knows that you love to golf. And let's say your Waymo-enabled car is driving you home from work, and you're getting close to a driving range. It will let you know that you'll be passing the driving range in the next two miles. And it will ask you, "Would you like to stop and hit a bucket of balls?"
It gets even more interesting if you think about some of the other new technology Google is developing. For instance, are you familiar with Google Home, that little "smart speaker" that listens to all of the conversations you have in your house every day?
Chris: Is it like Amazon's Echo device? I'm familiar with that.
Jeff: It's something similar. Google Home is mining for data all the time. If it knows that you said, "Oh, we're almost out of milk"... or, "I need to buy some lettuce and avocados for a salad tonight," your Google car will present you with an opportunity to buy lettuce and avocados on your way home from work. Your car will speak to you and remind you when you're close to a supermarket that you need some things.
Chris: Doesn't any of this freak you out? Does the symbiotic relationship we're developing with computers and artificial intelligence make you at all worried?
Jeff: Let's put it this way: The benefits far outweigh the disadvantages for the vast majority of consumers.
Take Facebook, for example. Most of its users have never read the Facebook privacy policy. They don't have a clue what Facebook – or Google, for that matter – does with its data. But these companies are collecting all of this personal information about you. Then they bundle it up and sell it to the highest bidder. Everything you look at online... every chat you have... everything you post to your social-media accounts – all of it is consumed, digested, recorded, and sold.
If you tell that to your average consumer, they may not like it, but they won't stop using Facebook or Google. The reason? They find too much value in those services. And those services are free – you don't pay to make a Google search or set up your Facebook page. So folks will continue to use these services irrespective of what's being done with their data.
When you provide these types of things with such amazing utility at zero cost, people will use them... even if there are some things that they find a bit weird. The same goes for self-driving cars and trucks. People will find them a bit weird at first, but they will use them anyway because they are so darn useful.
It's why I urge your readers to take note of this trend. Every month that passes brings major improvements in autonomous technology, more data, and more proof that the technology is already several times safer than human drivers.
Most people still don't get it. But as I said earlier, we are on the cusp of commercial deployment. And this is creating spectacular investment opportunities in companies that build technology to support autonomous vehicles.
Alphabet, which owns Waymo, is one of them. Uber's new CEO Dara Khosrowshahi recently announced that Uber would prepare for an IPO as early as the next 18 months. That's another company I'll be keeping my eye on. Even chipmaker Intel is setting itself up to benefit. Intel acquired Mobileye, a company that specializes in computer vision for autonomous cars, earlier this year.
Another fantastic, leading-edge company in this space is Nvidia, which I recommended in February 2016. Nvidia has been a leader in using its graphics-processing units combined with artificial intelligence to develop the "brains" of an autonomous driving vehicle for car manufacturers. It was very early in developing the technology and as a result has a significant lead in the industry right now.
The bottom line is that this disruptive piece of technology isn't decades away. It's right around the corner.
Editor's note: As Jeff explained today, the future of self-driving cars is here. That's why he has spent all of 2017 researching little-known tech companies set up for explosive growth as this industry goes mainstream. Jeff recently put together a brief video presentation sharing all of the details. Watch it here.