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Waymo, Alphabet’s autonomous vehicle (AV) technology spinoff, revealed that it’ll begin selling one of its 3D LiDAR sensors — known as Laser Bear Honeycomb — to select companies in non-auto industries like manufacturing and agriculture, according to a Medium post.
LiDAR is a laser image-sensing technology that collects data about the environment around a self-driving car and feeds it to the car’s computing system to help it visualize that environment. The tech has value beyond AVs: For example, an industrial robot equipped with LiDAR sensors could visualize an object it’s designed to pick up and be better able to grip it.
We’ve long expected Waymo to sell or license its industry-leading technology to other auto companies — its choice to sell its LiDAR technology to non-auto companies first likely reflects a pair of ambitions:
- Waymo doesn’t yet want to give competitors access to its leading AV technology.Waymo is widely considered the global leader in the self-driving tech space, and its proprietary LiDAR sensors are a core part of that success. Two years ago, the company revealed that it reduced the cost of manufacturing its proprietary LiDAR by 90%, demonstrating the immense amount of progress Waymo has made with its sensor technologies. Further, Laser Bear Honeycomb has a vertical field of view of 95 degrees — compared with 30 degrees for many other LiDAR sensors — meaning that a single Honeycomb sensor can do the job of three other sensors stacked on top of each other. At a time when Waymo is looking to ramp up its AV ride-hailing service and put distance on its competitors in the market, it likely wants to guard its high-quality, proprietary LiDAR technology.
- Waymo is likely also seeking to recoup some of the investments it has made in self-driving tech over the last decade. Waymo began work on AV tech in 2009 when it was still part of Google’s X moonshot wing. While Alphabet doesn’t break out its revenue in its quarterly filings, competing self-driving tech firms generally lose immense amounts of money — for example, GM’s Cruise unit lost $728 million last year, 19% more than it shed in 2017. Selling the LiDAR sensors that it likely spent significant amounts of money developing will help Waymo recoup some of the massive investments it’s made without aiding competitors.
It makes sense for Waymo to license its tech to competitors in any one of three cases:if it becomes dominant in the ride-hailing market, if its ride-hailing service fails altogether, if it cedes international markets to other players. If Waymo comes to dominate the AV ride-hailing market, licensing its technology to distant competitors would no longer present a significant threat. Waymo could decide it’s not worth the time or effort to launch ride-hailing internationally and instead rely on licensing for revenue abroad.
Finally, if Waymo’s autonomous ride-hailing efforts are ultimately unsuccessful, it could abandon them and focus exclusively on licensing and selling its technology to OEMs and ride-hailing companies.
Waymo currently appears laser-focused on ramping up its autonomous ride-hailing service, a wise move given that Morgan Stanley estimates it’s the firm’s largest opportunity outside of logistics. But given the revenue opportunity from licensing and speculation within the industry that it’ll eventually open up its tech to competitors, it’s more of a question of when, not if, Waymo will get into licensing to automakers. The Laser Bear Honeycomb news only strengthens that supposition.
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