Waymo the Leapfrog

I have been riding Waymo around LA for over a year with no issues. To me, it's just an Uber with an invisible driver, and more predictable experience.

Riding it is now a mundane experience, and that's a marvel in itself. Every time I'm forced to get an Uber in another city (or do airport rides as Waymo doesn't do pickups/dropoffs in LAX yet), I feel like I went 5 years back in time.

My Tesla has FSD and that has gotten progressively better the last few updates, however Waymo still feels ahead. I can truly "relax" in a Waymo, where FSD still makes me uneasy at times, like I'm supervising a teenage driver.

It's exciting to see Waymo and self driving technology in general doing well, but the analysis on the broader implications fell flat for me. Claims about improving commutes or being more effective than mass transit need to be substantiated - there's a ton of stuff out there on traffic engineering, mass transit, and urban planning that can help perform these sorts of analyses.

Some thoughts:

* For the purposes of transit efficiency, self driving cars are very similar to Ubers. They have a low passenger density (being a regular car), and once the passengers disembark, they still take up space on the road with 0 passengers. Better experience and lower costs will basically just induce more demand over more efficient mass transit options. If you imagine everyone at a bus stop ordering an Uber, or have ever seen the flurry of Ubers after a big event, it's clear why self driving isn't really addressing the core issue.

* You can't really make direct cost comparisons to the infrastructure costs of bus lanes or subways like that. Infrastructure is ungodly expensive in the US, yes, but there are very well understood reasons to make dedicated bus lanes and subways: they don't compete with cars on the road. They're high density transit options, so having more reliable service will impact a lot more people (and reduce car congestion on the road!) A rideshare service is wholly unprepared to deal with the transit demands of a larger city, and imagining that we'd replace existing mass transit options with it is silly.

* I don't really understand the point about suburbs. You can already get that experience today by ordering an Uber to and from work. If there's more demand, it's just going to make traffic even worse while promoting more suburban sprawl.

> In fact, this might bring American public transportation to a leapfrog moment. Many pundits have lamented that developing cities elsewhere have “leapfrogged” the US on public transportation — building subways and rail networks that put ours to shame. Over a hundred years ago, we built first-generation public transit.15 Over the last forty years, other countries built second-generation public transit. Now we have the opportunity as a nation to lead the world on third-generation public transit, and in that course develop products and expertise that can be exported.

This is quite the stretch. Even in the best case scenario, Waymos won’t beat well run public transit lines in dense cities, especially in east and south asia.

This piece is way too optimistic about Waymo. They’ve mastered a couple of cities over many years. To do that for more cities would require just as much time. It’s conceivable that ride share will continue to exist until that happens, which is likely several decades.

> Waymo becomes most interesting as an alternative to public transit.

I really wonder what this looks like logistically, when you realize how inefficient it is for everyone to be in their own individual Waymo during rush hour.

The obvious first step is:

> Many people who currently drive themselves would probably be happy to carpool in a self-driving vehicle if it’s reliable and easy

But if it's a 4-person vehicle, I'm not sure that's enough -- that's still a lot of vehicles clogging bridges and tunnels. And if you get to 12-person self-driving minibuses, it feels like too much time picking up and dropping people off if you're trying to stick to one vehicle.

So I kind of wonder if there will be intermediate ~20-person self-driving buses to bring people in and out of cities, that respond instantly to demand?

So in the suburbs, you take an 8-minute individual Waymo that brings you to a perfectly timed Waymo Bus that you wait 3 minutes for, get on with 19 other people for 42 minutes, everybody gets off at the same point at the edge of downtown, and everybody gets into carpooling individual Waymos already waiting, so you take 7 mimnutes to get to your office, dropping off 2 people along the same route you would have taken anyways.

But the buses don't have fixed routes or stops or timetables -- they just aggregate the demand along the common long corridors. Essentially replacing light commuter rail.

The article estimates that the vehicles cost $200k based on Cruise's reported numbers in 2023 for vehicles produced in previous years.

Reporting often misses just how quickly vehicle costs have dropped. When I started in the industry, vehicle costs often exceeded $500k. Almost everyone I'm aware of today is targeting sub-$100k.

It's interesting to me that the author hadn't previously considered that self driving cars would feel different. My first experiences in an Uber were very memorable, the drivers are so much more aggressive than I am. I kept thinking "they drive like an asshole so I don't have to" because it felt so much like I was being driven by my teenage self.

But also -- I've been thinking about what it would be like to have nobody driving for over a decade, ever since the promise of self driving cars became a popular topic here on HN. I still really want to own one - once they're good enough to get rid of any interior controls and face the front seats backwards with a gaming table in the middle. If board game day could also have a destination dinner, I would pay a lot of money for that car.

Credit to the author for pointing out the public transit aspect of Waymo. In the same way that mobile phones and solar are allowing the developing world to skip a big middle step of fixed infrastructure, Waymo could allow cities to skip (or eliminate) expensive and limited use rail networks.

Broadly speaking, I agree with the article. This has the potential to leapfrog mass transit as well as Uber. But how the Waymo model develops is probably unknowable right now. Will there be a variety of Waymo vehicle purpose-built for Waymo? Will Waymo become a bus service on heavily traveled routes? Or will iit becomme a kind of franchise where the transit agency is responsible for the vehicles and Waymo becomes a white-label enabling technology or are bus routes going to be obsoleted by right-sized privately owned Waymo "mini busses" with dynamic capacity and pick up/drop off on demand?

My guess is that Google will try to get out of the business of owning the vehicles and make Waymo an enabling technology. But there is a lot of experimentation to be done before anything other than how Waymo has evolved to become part of what Waymo does.

This piece makes the argument that self-driving taxis will be a winner-takes-most market, but color me skeptical.

Winner-take-most markets, like Uber, tend to be two-sided marketplaces with major network effects: folks use Uber because they’re pretty ubiquitously available and relatively inexpensive; they’ve available because the many users request many trips which makes working for Uber as a driver appealing. (Ditto AirBnB, etc.)

But Waymo’s competitive advantage is pretty much only technology here. There is an argument to be made that this technology has a “network effect”-style moat: you need massive amounts of data from cars to build the tech; you get that data by being first to market. But this post doesn’t make this argument, it simply points to Uber/Lyft/the-taxi-app-graveyard and says “see?”

It’s also not clear that this set of data will forever be as critical as it is now, nor that in 10 years it won’t be comparatively easy to collect.

If the only edge that Waymo has here is technology, that’s not a natural monopoly position on its own. Autonomous driving is surely hard, but it’s an absolute-performance-baseline task, not a zero-sum market like ads. The existence of one set of 0.0001%-accident-rate-drivers doesn’t prevent anyone else from producing a 0.0001%-accident-rate self-driving car. There’s a small market stickiness effect from being first, sure, but this is not the same kind of natural monopoly as a two-sided marketplace. It’s clear why users use Uber and AirBnB over alternatives: it’s where the drivers and properties are, and that takes time to build up and it hard to take away. It’s not clear why someone would be a tied to Waymo if another equally-available self-driving taxi were available that were substantially less expensive, even if it were marginally less safe. (Of course, everyone has their trade-off point here—consider airlines: while people are more likely to pick an airline based on convenience and price, rather than safety record, these days—United perhaps excepted—that’s only true because the overall accident rate is so low.)

Assuming the baseline for “safe operation” doesn’t escalate, improvement in technology (e.g., more capable GPUs, better sensors, more public datasets) will only make this baseline easier to reach for newcomers. If the tech gets easy enough, all it will take for a new entrant is CapEx, and it’s not clear how Google would differentiate, and could end up as a single commodity provider among many, rather than a two-way marketplace owner benefitting from network effects on both sides.

That said, to construct a monopoly here, Waymo does have a couple of options:

1. Argue for regulation around self-driving cars that protects incumbents, by (e.g.) setting safety standards that are impossible for new entrants to meet. The NRC has a “good” model for this: by analogy to nuclear plants, any new vehicles on the market would need to prove that they are better than existing vehicles in the market.

2. Cut deals with major auto manufacturers so that incumbents just can’t get the data through partnerships with camera-equipped vehicle manufacturers.

Number 2 seems like it could be clearly anticompetitive, but number 1’s playbook is being written by the big AI companies as we speak.

This reads very much like a Waymo advertisement.

> The once-dreaded long commute is about to come back in a big and pleasant way. I would have no issue at all sitting in a Waymo for 45 minutes each way every day. It’s just a nice time to myself that I can use to nap, work, or read.

In places with working public transit, you can already have that experience. While it may make the experience less stressful (because you're not driving), it is still a huge time sink. You can do something entertaining while on a bus or in a Waymo, but it still blocks off time you could spend more productively.

Makes me wonder what Waymo’s endgame is. Become another Uber, become a car company or provide the tech to other car companies?

It's great the author is passionate about Waymo but wow this reads like an advertisement.

> They’re commercially available. Anyone can download the app and hail one

Alas, not if you're from Europe it seems. I'd love to try one when I'm in the Bay area

Google product, and therefore mark my words: today's peaceful book-reading ride will be ad-infested in 20 years, if not less.

One of Google's projects that actually persisted through hardships while others didn't.

The unit economic analysis here is really off. Waymo loses a billion dollars a year on operating in only two or three cities. The cost is clearly not just the CapEx of buying the vehicles, there’s an incredible amount of ongoing engineering that takes place behind the scenes. Cruise had roughly 1.5 engineers assigned to each vehicle on the road at all times.

If Waymo could operate in downtown Boston? Safely, reliably? Then, at that point, color me impressed!

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I don't get why Tesla keeps touting that they're going to have FSD taxis... in a few years. And their stock goes up when they (usually it's Musk, let's be clear) tout this. Waymo already has this (in limited areas). Why wouldn't Musk just partner with Waymo on this? Isn't this a situation where the more people using the tech will make it better faster than trying to have a dozen different companies chasing it essentially duplicating effort and training? Self driving seems like an area where it would be beneficial to share training data as much as possible.

If anything goes wrong during your ride a real person will have to let you out and you will be stranded . A person has been taking many rides with Waylon but on the other hand this is really an alpha or beta project. See https://youtu.be/TbEplrZ-uSA?si=OCZt46gfVN9EfFhz