Human Driving RIP 

Intel/Waymo/AI And The Long March To Autonomous Car Dominance      

  • Autonomous cars likely represent of the biggest potential technology waves since the Smartphone. This is because, to function properly, they’ll not only have to carry some of the most powerful computers ever created, they also will have to have a network that is even more ubiquitous than the cellular network, and have a secure management overlay that would dwarf that of Nuclear Power plants. And, right behind autonomous cars and trucks, we have autonomous flying drones coming some of which will replace these autonomous cars which aren’t yet in market.

    This week GM announced they are ready to ship Level 4 cars now (5 is the highest level), Tesla (who continues to outperform the rest of the auto industry in valuation) is one patch away from having Level 3-4 cars on the road (they are arguably Level 2.5 now-and expected Level 5 by 2019), and Level 5 cars have been slowly entering the early test process.

    Intel, who was late to this game, appears to be working furiously to catch up and today’s announcement with Waymo, on top of their AI announcement, again suggests that, when we get to Level 5 in production, Intel will be at least a major player and perhaps even dominant.

    Intel’s Long Game

    Autonomy isn’t just about cars. We are currently as an industry working on autonomous drones, planes, boats, submarines, and robots of all sizes and flavors. In a few short years a moving device that isn’t autonomous will be the exception and no longer the rule. To get there we’ll need a host of sensors, powerful computing power on the devices and in the cloud, a substantially beefed up wireless network, and a significant focus on security (particularly if we want to avoid the Robopocalypse).

    While the company was late to this game they have aggressively captured much of the sensor market and report to be in most of the trial cars to date. They’ve been rapidly expanding their computational effort though it still lags NVIDIA in this regard. They’ve been aggressively moving on the 5G wireless space and while Qualcomm still dominates, Intel is proving to be a powerful competitor in this space. Their current position in the Cloud is as the number one technology vendor being favored by OEMs and Cloud service providers who build their own equipment by a significant margin. And, finally, they have been historically aggressive on security and currently are behind the leading IoT hub in the market.

    They don’t own every segment but they are currently the only vendor with a significant position in each of them and they still maintain a larger overall presence than any of their peer competitors. This showcases they are playing the long game, willing to concede leadership in one or two positions over the short term with the strategy of being first with a complete truly end to end solution going from the autonomous mobile device all the way to the cloud with most everything in between.

    Intel’s Possible Vulnerability

    Intel’s possible vulnerability is in partnerships as vendors that don’t have the complete solution could partner to get it. But Intel is already engaged with many of the likely partners making it more difficult for a challenger to offset Intel’s potential economies of scale with a partner. Another vulnerability are the efforts by many in this space to develop their own solution but these efforts put most of Intel’s competitors at the same disadvantage because they strip out the value provided by these firms in favor for their own unique proprietary offerings. However, due to the need for most of these things to tightly interoperate they stand alone efforts will likely fail due to a lack of interoperability and Intel’s solutions will interoperate out of the box making it more, rather than less, likely that the model that Intel is using to prevail and at least assuring one of the autonomous technology providers to prevail. There is an increasingly good argument that someone will be Intel.

    Wrapping Up: Sneaking Up On Poll Position

    With these announcements Intel’s position, with regard to autonomous technology, improves greatly though it doesn’t yet put them out of reach or even clearly in the lead. It does put them on a clear path to that goal and, if the firm continues to execute this sharply, it becomes even more likely they will eventually emerge as the vendor leading the segment.

    While we remain on the path to becoming surrounded by autonomous robots that roll, fly, swim, and even walk, it is becoming increasingly likely many, if not most, will eventually have Intel Inside.