David Leppik
Jul 30, 2017 · 3 min read

Ah, the “value creation” perspective. The same perspective that brought us free, ad-supported PCs and told us Foursquare would be bigger than Facebook. The perspective that first asks “how can I get money out of consumers?” without asking “what do consumers actually care about?” or “where are these consumers getting their money in the first place?”

Geo-located push advertisements have failed at least five times in the last 20 years because it turns out that people don’t like advertisements being pushed on them. They don’t want a text message coupon when they go near a store. Even less so if their nose is down in their cell phone and they are barely aware of their environs.

Heads-up displays (including those window displays proposed by Panasonic) are inherently low contrast because the light of the display competes with light coming through the window. People complain about glare on their computer screens; imagine if the glare comes from both sides! What’s more, they are lousy for augmented reality (AR) because of parallax: if you shift your head slightly, that point-of-interest marker is pointing at something completely different. Even if the display did eye tracking, that boy couldn’t actually show things to another passenger. There’s a reason AR has only caught on for back-up cameras, not mirrors or heads-up displays. The video was produced by Panasonic as a way to ask “how can we sell more and bigger displays to car makers?” with the answer, “we haven’t actually come up with anything realistic yet.”

Fully autonomous cars will have profound changes in how we live, but rather than make pie-in-the-sky guesses based on where you can make money, you can take a closer look at actual cultural shifts from analogous technologies. Over the last 200 years, we’ve seen lots of changes in transportation technology, from bicycles and cars to steam engines and subways. They’ve caused significant shifts in where people live and work, some favoring suburbs and others favoring city cores. Self-driving cars could promote greater density because people may need fewer parking places, but more likely they will promote larger suburbs because people are less sensitive to commute time when they don’t have to focus on driving.

For the foreseeable future I don’t see significantly lower American car ownership. Most Americans use their cars mainly to get to and from work, and they like to be flexible about side trips on the way home. Carpooling has been promoted for decades and has never caught on, even in cities which have HOV lanes. Ride sharing and car sharing has allowed urbanites who mainly use public transit to avoid buying cars in cities with poor taxi service. People don’t commute via Lyft because it isn’t as reliable or convenient as car ownership, and it’s much more expensive. Fully autonomous taxis would have most of these issues. Most of the morning commute is from suburbs to the urban core, mainly arriving by 9:00. An autonomous taxi might make two trips, one for the 8:00 crowd and one for 9:00. The taxi would have to make an extra trip to get from passenger to passenger, increasing traffic. Parking gets cars off the road.

Finally, we have to think about the time scales of these changes. We now have cars that can drive on well-marked highways in good weather conditions for most of a trip. We’re tantalizingly close to being able to drive in well-marked, well-mapped urban areas under good weather conditions. We’re decades away from being able to handle all driving conditions, particularly snow-obscured streets. (That’s not just my opinion; that comes from the head of Google’s self-driving car division.) While I love to bike to work, I wouldn’t trade in my car even if I could bike all but one week per year: I still need to get to work that week! People won’t trade rainy-day reliability for sunny-day convenience. Houses, roads, and buildings get built on an even slower schedule, often trailing demographic shifts by decades. (The 1950s were an anomaly, due to rapid population growth.) If you want to make a quick buck here as a venture capitalist, you can do it — but by selling a dream, not reality.

    David Leppik

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