AirBnB works great when you exceptionally need accommodation, far from your normal environment. Most people would hate to need booking an AirBnB every night of the year, in order not to sleep under a bridge.
I think people can regularly move around in impersonal vehicles (as shown by public transportations), but they'd hate depending daily on borrowing a car that's clearly someone else's. They'd probably also have a problem leasing their own car when there's a slight risk that they might need it. So really, the dynamics that makes AirBnB possible doesn't seem to translate well to daily transportation.
> There's no reason the manufacturers can't take this approach themselves.
I'd turn it the other way: it's likely that the fleet operators will also build and repair the vehicles. But I wouldn't bet that legacy car manufacturers will be the ones cornering that market.
Very unluckily for them, electric power and autonomous driving look like they'll become mainstream simultaneously. As explained above, I believe the former will breach their historical moat, and nothing indicates that they'll be the first to rock at the latter, as well as the new kind of consumer relationship that comes with fleet operating for consumers (most of them already operate corporate fleets).
Anyway, unless you're a shareholder, it doesn't matter much whether the behemoth of tomorrow is called Ford, Tesla or Über. Many of the individual engineers will be the same either way, hired by the winner. I don't believe in Apple winning this: they're good at making you lust for ownership of tangible goods, but offering collective services in impersonal vehicles doesn't feel like it's in their DNA. As for Google's moonshots, I can't remember any of them being successful. Moreover, they'll probably be beaten at their usual strategy of accumulating more data than others and parsing it better: Tesla's already accumulating millions of analysable miles with their actual fleet of actual cars doing actual travels, while Google toys around SF with replicas of Noddy's car. And Musk's been hinting at interest for building a company-owned fleet (although he would be a fool to say it out loud: Tesla's all about making electric cars sexy to own).
Über is also very well positioned for smart data accumulation. And IIRC, Kalanick has always been open about his plan of cornering the autonomous cars fleet market before autonomous cars exist, and hiring drivers as a temporary stop-gap (which he also openly treats like shit).
> Plus most buyers prefer a fixed, regular payment over paying-per-use
They currently pay a mix of the two (they pay for gas and maintenance per mile). With electricity being cheaper than oil, it's possible for fleet operators to offer an even better per-month / per-mile ratio. And I agree with you that they'll probably do just that. Unless of course, a monopoly is secured so fast that there's no point in making fleet customers happier than those of cellphone or cable operators.
> Most people would hate to need booking an AirBnB every night of the year, in order not to sleep under a bridge.
Some people use Uber or Lyft occasionally. Some use them every day. In both cases the mechanics of use and billing are identical.
> I'd turn it the other way: it's likely that the fleet operators will also build and repair the vehicles.
Hertz, Avis et al are not seen as competitors to GM or Toyota, because the car-hours market is relatively dominated by owner-operators.
I don't see anyone talking about those companies manufacturing their own cars. Probably because manufacturing a modern car is a hard business to get started in. Tesla did, after years and many millions of dollars.
Maybe Tesla will go the fleet model. But nothing stops Chevy from doing the same. Nothing stops every single manufacturer from doing the same. There is no network-effect moat here.
They aren't: you have to go and fetch the car at their shop, which is very impractical compared to having your car parked on your driveway.
The most radical change with autonomous cars isn't that they drive themselves with passengers in it: it's that they'll drive themselves empty in order to pick up passenger wherever they want, whenever they want. That's what makes not owning a car practical.
> There is no network-effect moat here.
There might not be a natural monopoly, but there is a pretty big critical mass: to reliably serve cars fast enough at predictable prices, a fleet must be pretty large. And whenever you go from city A to city B, you need the operator to be present in both cities.
You're right that everyone's allowed to compete on this new market, including Chevy. Just as Blackberry and Nokia and Microsoft were allowed to compete in the post-iPhone smartphone market. But have they got a critical advantage to help them succeed? They've got plenty of legacy that will be more of an hindrance: dealership networks (that's another thing Tesla is fighting tooth and nail not to get entrapped with), many engineers and engineers-turned-executive who can't let go of a dead culture (ICE, driving as a dangerous-but-exhilarating activity, cars marketed as phallic substitutes), syndicated workers on their assembly chains...
Twice in my career I've seen incumbents lose their market, because it took them too long to embrace inevitable change: Unix workstations killed by Linux on beefed-up PC in the early 00's, and cell phone makers deprecated by iPhone and Android in the late 00's. I'd be surprised if GM and Ford proved smarter and more adaptable that HP or Sun in the good old days, or Nokia and RIM a decade later.
When the paradigm shifts, you're better off with a clean slate than with a legacy.
> They aren't: you have to go and fetch the car at their shop, which is very impractical compared to having your car parked on your driveway.
Precisely. Some people will still want to own their car, even if it's autonomous. I imagine that over time folk will become accustomed to living more like New Yorkers -- renting car time -- but it might not be a big bang.
> And whenever you go from city A to city B, you need the operator to be present in both cities.
Or you have a service acting as middleman. Like AirBNB, or Amazon, or Google.
> Unix workstations killed by Linux on beefed-up PC in the early 00's
This process has already played out in the car market. It's what Ford did to the dozens of small manufacturers who existed previously. Unix vendors had high margins that couldn't be sustained as mass-market technology caught up. Sheer manufacturing power (and let's not forget Windows here) did them in.
New car manufacturers are not entering a market of Unices. They are entering a market of Intels.
> cell phone makers deprecated by iPhone and Android in the late 00's
This one is due to genuine product improvement, in my view. The iPhone was actually usable, it wasn't just random options stuffed any old where the engineers found a gap in the menus.
But again, cars are a rather more sophisticated product. They already compete on design. There might be some more competition on usability.
> I'd be surprised if GM and Ford proved smarter and more adaptable
It occurs to me that I ought to have disclosed that I work for Pivotal, in which Ford recently invested a lot of money. It didn't occur to me because I don't work with any Ford teams myself, though some colleagues in the company do.
What I can see is that neither Ford, nor GM, are just sitting around waiting to be replaced. The lessons of the technology industry are now widely diffused. Applying them uncritically means assuming incumbents will rest on their laurels, because that's what happened in tech.
Except everyone else has gotten to observe what happened in tech. Incumbents understand the perils of laurel-resting.
> When the paradigm shifts, you're better off with a clean slate than with a legacy.
iOS is based on a technology that is nearly 50 years old. Android is based on a technology that's 25, inspired by the technology that is nearly 50.
AirBnB works great when you exceptionally need accommodation, far from your normal environment. Most people would hate to need booking an AirBnB every night of the year, in order not to sleep under a bridge.
I think people can regularly move around in impersonal vehicles (as shown by public transportations), but they'd hate depending daily on borrowing a car that's clearly someone else's. They'd probably also have a problem leasing their own car when there's a slight risk that they might need it. So really, the dynamics that makes AirBnB possible doesn't seem to translate well to daily transportation.
> There's no reason the manufacturers can't take this approach themselves.
I'd turn it the other way: it's likely that the fleet operators will also build and repair the vehicles. But I wouldn't bet that legacy car manufacturers will be the ones cornering that market.
Very unluckily for them, electric power and autonomous driving look like they'll become mainstream simultaneously. As explained above, I believe the former will breach their historical moat, and nothing indicates that they'll be the first to rock at the latter, as well as the new kind of consumer relationship that comes with fleet operating for consumers (most of them already operate corporate fleets).
Anyway, unless you're a shareholder, it doesn't matter much whether the behemoth of tomorrow is called Ford, Tesla or Über. Many of the individual engineers will be the same either way, hired by the winner. I don't believe in Apple winning this: they're good at making you lust for ownership of tangible goods, but offering collective services in impersonal vehicles doesn't feel like it's in their DNA. As for Google's moonshots, I can't remember any of them being successful. Moreover, they'll probably be beaten at their usual strategy of accumulating more data than others and parsing it better: Tesla's already accumulating millions of analysable miles with their actual fleet of actual cars doing actual travels, while Google toys around SF with replicas of Noddy's car. And Musk's been hinting at interest for building a company-owned fleet (although he would be a fool to say it out loud: Tesla's all about making electric cars sexy to own).
Über is also very well positioned for smart data accumulation. And IIRC, Kalanick has always been open about his plan of cornering the autonomous cars fleet market before autonomous cars exist, and hiring drivers as a temporary stop-gap (which he also openly treats like shit).
> Plus most buyers prefer a fixed, regular payment over paying-per-use
They currently pay a mix of the two (they pay for gas and maintenance per mile). With electricity being cheaper than oil, it's possible for fleet operators to offer an even better per-month / per-mile ratio. And I agree with you that they'll probably do just that. Unless of course, a monopoly is secured so fast that there's no point in making fleet customers happier than those of cellphone or cable operators.