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Uber and Google do battle over self driving car

TimeOdd Stories - self driving car

Even the biggest, most powerful companies in the world are at the mercy of a grade-school concept: supply and demand.

That’s how a person like Anthony Levandowski can get paid $120 million by Google, leave to start his own company, watch that company get acquired by Uber just months later, and then find himself barred from working on self-driving car technology by a U.S. court.

That goes to show just how important Levandowski—and other engineers like him—truly are to the arms race around self-driving cars.

“It’s not like [you] can hire any one of the thousands or tens of thousands of people who have a particular certification,” said Nidhi Kalra, who heads the RAND Corporation’s self-driving car policy work. “They’re looking for people who are innovators in the fields of machine learning, deep learning, LIDAR design—and there aren’t a lot of those people out there.”

It’d be one thing if there was a small talent pool and few people hiring out of it. But the current reality? That limited supply of talent is being wrung dry, by a crush of demand from some of the biggest companies in the world: Google, Apple, Intel, Uber, Tesla, Toyota, Ford, BMW, Volvo, Nissan, Lyft, Ford, General Motors, Baidu (the Google of China), Honda, and plenty of others. Together, they account for billions of dollars spent developing technology that will fill our roads with self-driving cars.

And yes, that’s still years away. But there’s a good reason all those companies are chasing the same dream: Being first to have commercially viable self-driving cars carries with it the prospect for a massive return on the money spent creating them.

And yes, coming in second or third will make a hell of a difference.

“Once people use an app, it’s hard to get them to change an app,” Kalra said. “There is a first-mover advantage in a space where you get a whole bunch of distributed users trying to use something.”

Google’s lawsuit against Uber and Levandowski centers on the LIDAR laser technology that helps cars understand their surroundings. Google claims Levandowski took 14,000 confidential files from Waymo (the self-driving car operation owned by Google’s parent company, Alphabet) that helped form the basis of technology he helped create, which Uber then acquired once it bought Levandowski’s company.

Google’s already won a minor victory. A judge barred Levandowski from working on Uber’s self-driving car project until the case is resolved. The case is headed for open court, which is generally seen as bad news for Uber, as it will mean they’ll have to reveal secrets, and leave the verdict’s fate to a jury. It’s a case that could result in Uber essentially being forced to hit the reset button on a substantial part of its self-driving car operation. This is a company that already has self-driving cars on the streets of Pittsburgh and Arizona. Few competitors in the space are that far along.  If they lost in court, it’d be a major setback for a company that’s been seen one of the leaders in this field. But it’d also be everyone else’s gain—including Google.

Uber and Google used to be friends. Google Ventures invested $258 million in Uber back in 2013. An Alphabet executive also sat on Uber’s board. Uber was a big user of Google Maps. And on a personal level, Uber CEO Travis Kalanick and Google co-founder Sergey Brin were once friendly.

Not so much these days, as detailed by the New York Times. The two companies are now in essentially open-ended war with each other.

It’s a story that’s been playing out across the industry. More lawsuits over engineers leaving companies with trade secrets. Poaching competitors’ top talent as a matter of routine. And so on.

Like any war, there are allies on each side, too. The weaving number of partnerships between technology and car companies—along with a lot of investments—created a thick web of ties. Companies striving to be among the first to the market with self-driving tech are forming unions of tech, car, and consumer apps, in hopes that they’ll all be able to benefit from what’s to come.

The gold rush is on. Outsized multinational companies are involved, and so are  venture capital firms’ big pocketbooks. Self-driving car startups received more than $1 billion in funding over 2015 and 2016 — and $767 million in just the first quarter of 2017.

“The surge in deals to autonomous driving startups in recent years is a clear reflection of how attention’s been drawn to the self-driving space,” said Kerry Wu, senior research analyst at CB Insights. “Competition’s fierce among both private and large public companies to successfully field the first autonomous cars, and also among VCs and other investors jockeying to add top auto tech companies to their portfolios.”

That’s music to the ears of engineers who might see an opportunity to start a company, raise a chunk of cash, then get bought up. Companies like Google and Uber are both kingmakers and pawns here.

All of this goes to show that Levandowski is not some bizarre situation or random outlier. There’s just not that many Levandowskis out there—and that’s not going to change over night. If anything, people like Levandowski are more aware than ever before of how much power they hold in this situation—even over companies like Google and Uber, to say nothing of the future of transportation.

And now, it’s clear that the companies involved are ready to play rough. Google (and any other company) can’t afford to look weak. Talent leaving is bad enough; talent leaving and taking tech to another company is unacceptable. Every self-driving car engineer and every company is on notice.

Which is great, until it starts slowing the pace of innovation. Uber might have it coming, but removing one of the biggest (albeit not terribly altruistic) companies from this race isn’t necessarily good for consumers. Sure, there’s enough companies to go around right now. But if this race among competitors turns into a stroll between partners, the reality of self-driving cars is farther away.

On the upside, the lawyers will do well. Of course.

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Written by TimeOdd

TimeOdd is a leading technology media property, dedicated to obsessively profiling startups, reviewing new Internet products, and breaking tech news.

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