The Disruptive Technologies MGI paper emphasized one area of which I have quite a bit of direct knowledge, autonomous vehicles.
The "self-driving car" has been progressing over the last six years or so. Google has been pushing the hardest, but other high-end manufacturers have also explored and participated within this area. First, let's start with a framework for analyzing autonomous vehicle development. Progress in this area can be broken into three distinct steps:
- Driver assistance technology. Cruise control, automatic braking, and accident avoidance falls into this category. These are not new, but certain areas show promise of progressing significantly. The primary benefits of this technology are to make driving a little less tedious and improve driving safety. These incremental benefits are good, but not revolutionary.
- Autopilot technology. Specific basic driving tasks are taken over by the vehicle's computer system. This includes parallel parking, stop-and-go heavy traffic, and highway driving. This is similar to autopilot technology in an airplane. The basic steps are taken by the computer, but if any desirable changes wish to be made or out of the ordinary events occur, the human needs to take over. The key impact here is safety. The toll in human lives and property damages from vehicle accidents is enormous. MGI estimates (page 81) that we could see 150,000 accidental deaths prevented per year by 2025. This is a great improvement, but it's still not revolutionary or particularly disruptive.
- Autonomous vehicles. The key difference between autopilot and autonomous is that the human can sit in the back seat or not be in the vehicle at all. This is a disruptive technology with revolutionary impact.
Here are a few of the effects of autonomous vehicles:
1) Real estate - Commutes become less important as average speeds to destination increases, and the commute becomes much more pleasurable. This causes the competitive advantage of near-urban suburbs to fall, and boosts that of exurbs. Also, since vehicles can roam to a parking space, urban centers can become far more efficient in their land use.
2) Vehicle ownership - Forget even having to own a car. The incentive to own a vehicle for personal use would fall, creating an opportunity for those who can efficiently move into a new age of fleet management. Also, for those who do own a vehicle, any time it is idle it can be sent roving for passengers and become a revenue producing asset.
3) Taxis/Rental Car - Forget Uber and traditional rental cars. One calls a car, it picks them up at home, and takes them to the destination. No driver costs and minimal transaction costs.
4) As mobility is enhanced, there will be many other difficult-to-foresee benefits and effects cascading through the economy.
The progress up to just before the point of autonomous vehicles is good, but not particularly disruptive or revolutionary. There will likely be many hiccups along the way to improve safety, and these improvements will likely be incremental on a fairly limited but consistent basis. However, the steps up to the point of autonomous seem far more achievable in the medium-term. Contrary to the MGI statement, "Technology is not likely to be the biggest hurdle in realizing these benefits," technology is still a very large obstacle for moving to the autonomous phase. The primary disruptive and revolutionary segment is technology challenging. To my knowledge, you can take the best near-autonomous vehicle to date, drop it in midtown Manhattan, and it will... do nothing. Contrary to what is said in some circles, I believe Google took the smart approach by abandoning the traditional self-driving Lexus design and instead replacing it with a glorified self-driving golf cart. Beginning from the glorified golf cart, Google can initially implement on a larger scale, and then more easily scale up the technology from there. Also, the self-driving cart within retirement communities can already begin producing benefits for a segment of the population that can benefit most from the technology, and the private roads in these communities can allow Google to experiment with little government interference. However, Google's transition does put a damper on those believing that autonomous vehicles will be a near-term phenomenon.
One final note. Unlike some of the other improvements listed in the report, autonomous vehicles will likely have only a marginal impact on the developing world for both safety and infrastructure reasons. Those who have driven in these environments know how complex driving can be (more construction areas, worse road conditions, lower compliance with traffic laws, safety concerns, etc.), and that autonomous vehicles still have a ways to go before being able to navigate even just the urban areas of cities in the developing world.
The "self-driving car" has been progressing over the last six years or so. Google has been pushing the hardest, but other high-end manufacturers have also explored and participated within this area. First, let's start with a framework for analyzing autonomous vehicle development. Progress in this area can be broken into three distinct steps:
- Driver assistance technology. Cruise control, automatic braking, and accident avoidance falls into this category. These are not new, but certain areas show promise of progressing significantly. The primary benefits of this technology are to make driving a little less tedious and improve driving safety. These incremental benefits are good, but not revolutionary.
- Autopilot technology. Specific basic driving tasks are taken over by the vehicle's computer system. This includes parallel parking, stop-and-go heavy traffic, and highway driving. This is similar to autopilot technology in an airplane. The basic steps are taken by the computer, but if any desirable changes wish to be made or out of the ordinary events occur, the human needs to take over. The key impact here is safety. The toll in human lives and property damages from vehicle accidents is enormous. MGI estimates (page 81) that we could see 150,000 accidental deaths prevented per year by 2025. This is a great improvement, but it's still not revolutionary or particularly disruptive.
- Autonomous vehicles. The key difference between autopilot and autonomous is that the human can sit in the back seat or not be in the vehicle at all. This is a disruptive technology with revolutionary impact.
Here are a few of the effects of autonomous vehicles:
1) Real estate - Commutes become less important as average speeds to destination increases, and the commute becomes much more pleasurable. This causes the competitive advantage of near-urban suburbs to fall, and boosts that of exurbs. Also, since vehicles can roam to a parking space, urban centers can become far more efficient in their land use.
2) Vehicle ownership - Forget even having to own a car. The incentive to own a vehicle for personal use would fall, creating an opportunity for those who can efficiently move into a new age of fleet management. Also, for those who do own a vehicle, any time it is idle it can be sent roving for passengers and become a revenue producing asset.
3) Taxis/Rental Car - Forget Uber and traditional rental cars. One calls a car, it picks them up at home, and takes them to the destination. No driver costs and minimal transaction costs.
4) As mobility is enhanced, there will be many other difficult-to-foresee benefits and effects cascading through the economy.
The progress up to just before the point of autonomous vehicles is good, but not particularly disruptive or revolutionary. There will likely be many hiccups along the way to improve safety, and these improvements will likely be incremental on a fairly limited but consistent basis. However, the steps up to the point of autonomous seem far more achievable in the medium-term. Contrary to the MGI statement, "Technology is not likely to be the biggest hurdle in realizing these benefits," technology is still a very large obstacle for moving to the autonomous phase. The primary disruptive and revolutionary segment is technology challenging. To my knowledge, you can take the best near-autonomous vehicle to date, drop it in midtown Manhattan, and it will... do nothing. Contrary to what is said in some circles, I believe Google took the smart approach by abandoning the traditional self-driving Lexus design and instead replacing it with a glorified self-driving golf cart. Beginning from the glorified golf cart, Google can initially implement on a larger scale, and then more easily scale up the technology from there. Also, the self-driving cart within retirement communities can already begin producing benefits for a segment of the population that can benefit most from the technology, and the private roads in these communities can allow Google to experiment with little government interference. However, Google's transition does put a damper on those believing that autonomous vehicles will be a near-term phenomenon.
One final note. Unlike some of the other improvements listed in the report, autonomous vehicles will likely have only a marginal impact on the developing world for both safety and infrastructure reasons. Those who have driven in these environments know how complex driving can be (more construction areas, worse road conditions, lower compliance with traffic laws, safety concerns, etc.), and that autonomous vehicles still have a ways to go before being able to navigate even just the urban areas of cities in the developing world.
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