11.48 - Happy hanukkah 2023
48th edition of the 11th year of SmartDrivingCars eLetter
Who Will Operate Driverless Vehicle Services
M. Sena, Dec. 6, "I cannot say for sure whether the timing of the behave-and-clean up your mess 'Mom Reminder' and the UBER announcement were related, but I suspect they were. Together they set in motion a great deal of speculation in the ether about what it all meant for WAYMO, UBER, and EVERYTHING.
The answer is not 42.…" Read More
Hmmmm…. Read on and watch ZoomCast 348. The Waymo deal with Uber is very troubling for many reasons. One, is it even legal with respect to issues of collusion, price fixing? (I'm obviously not a lawyer.) More troubling is that it reinforces the perception that Waymo is focused on giving rides to people who relish Waymo's novelty as the attribute that makes it the winning mode in the user's choice process. Compared to classical 5-star Uber service. It isn't faster, cleaner, easier, friendlier, … It is just more novel.
For Waymo, that's fine, because they'll gain "HumanRevenue (minus their finder's fee to Uber) while expending RoboOperatingCosts" since Uber, at some point, is going to have to start charging HumanRevenue (LivingWage plus Expenses and its finder's fee) in order to remain a viable ride provider using its gig workforce.
It's an OK deal for Uber and its gig workers because they only lose these customers as long as the novelty shines. Once that wears off, their service level is a decisive winner, thus Waymo basically gets the "one & done" and Uber gets the repeat customer. The only thing that could upset this apple cart would be if Waymo started to use its substantial RoboOperatingCost advantage (plus the profit margin built into Uber's finder's fee that Waymo could keep on its books). Competing on price, Waymo could easily keep the novelty customers well after the novelty completely wore off while remaining extremely profitable even if their profit margin isn't quite as big as "HumanRevenue minus RoboCosts". Such price competition certainly wouldn't go well for Uber nor its gig workforce.
What seems really disappointing is that Waymo isn't focused on the societal benefit of giving rides to people for whom a ride that actually took them from where they are to, where they want to go, when they want to go would substantially improve their lives because that quality ride is affordable and is simply not available with conventional public transport systems. This market is enormous. It is not only a substantial portion of half of today's rides, roughly 500 million personTrips per day, but an unknown number of "latent rides" that aren't going to be taken today by all the people that couldn't find a ride and stayed home. Not only is their improved quality of life not realized, but also the stimulation to the economy by having them go to the places where they wanted to go but couldn't because they couldn't get a ride, let alone an affordable ride.
That's the real market and societal opportunity, which seems to be completely irrelevant to Waymo and most media outlets. Now with Cruise on the ropes, the two entities that can technologically unleash this opportunity are becoming a pipe dream. We may now need to have to wait for Tesla to get their driverless system to work well enough and be willing to engage and support technically a partner that can profitably deliver safe, affordable, equitable, sustainable high-quality rides to people who need rides, plus, without compromise, those that today give themselves a ride should they so desire. It's difficult to remain optimistic. Alain
is repeated below…
PersonTripLength (90%tile): 10 miles
Cost: