No IPO for us little people
Waymo is the best service I've used in many, many years. The jump from Uber->Waymo is similar to the quality jump from Taxi->Uber 12 years ago, but I don't see an obvious way for Waymo to get enshittified.
So a $110B valuation is not currently that significant in terms of exposure. It's only 2.7% of it overall.
Oh ye of little faith! Here are some ideas off the top of my head, I am sure the suits at Google already have a bigger list.
* Ads in vehicle
* Adjust route so you see partner companies or billboards
* Offering alternative destinations (I see you are going to Burger King, would you rather go to our partner McDonalds?)
* Listening to conversations in car
* Selling ride data.Ads in cars, partnerships with alternative destinations, etc. definitely would feel like enshitification for a demographic comparable to the hacker news one here. But these are all per session/user settings just like most of us have a paid Spotify account and never see advertising and those who don't get a very different monetized experience.
What is exciting about monetization like this is the possibility for rides to become very cheap or even free. If my dentist offers free rides to the office in return for my loyalty, I'm quite happy to take that.
Why not? You can consent to having your audio recorded. They can even offer a higher “private” price and a lower “ad supported” price. I write “private” because I assume the microphones will always be listening no matter which price you pay.
You could opt in to have blood or plasma taken on every ride if you so wanted I guess.
Also, cheap rides cut into stocks margins. That won’t fly by investors either. These companies are not charities. They are in the business of maximizing profits. We lost “don’t be evil” over a decade ago.
If you fly United, the in-flight entertainment has pre-roll ads.
I can't say how well that model translates to car rides.
people used to feel that way about search queries, email (gmail) and IP laws (LLM training).
> What is exciting about monetization like this is the possibility for rides to become very cheap or even free. If my dentist offers free rides to the office in return for my loyalty, I'm quite happy to take that.
this won't happen. alphabet will collect on both ends.
That's actually a really interesting angle. The same way businesses often provide free parking now... what if they start providing free self-driving round trips?
E.g. spend $75 or more at Whole Foods, and get free round-trip up to 20 miles or something. Especially for bulky items like groceries where a car makes a big difference, I can totally see that becoming standard. Home Depot too. Plus entertainment like amusement parks, movie theaters, spas...
I buy Whole Foods French fries shipped to the store via Amazon logistics and purchase those at Amazon owned Whole Foods, at a discount via my Prime membership on my Amazon credit card which is processed on AWS infrastructure and I ride home on an Amazon owned Zoox that also runs on AWS infrastructure.
Amazon owns so much of the profit margin across that stack that they can afford to give rides away for example.
- offer a service well below market rate, gain dependent customers
- crank up the price
No need to do much of the other stuff
It'll be up to you, just like whether you want your Netflix cheaper with ads, or more expensive but without.
I see that choice as a good thing.
The rest of your suggestions are incredibly unlikely. Google doesn't even scan your Gmail anymore, you think they're going to create a privacy scandal by listening to your conversations? And they certainly don't sell your Maps timeline which is far more valuable than just a few car trips, so why on earth would they do that with Waymo? Nor does Google Maps offer to send you to Burger King when you hit directions for McDonald's. And taking a longer route that wastes time, battery and money, on the chance you'll be looking out the window to see a billboard rather than looking at your phone, doesn't make sense at all.
Raise the price?
Self-driving taxis have a high floor for 'making the product worse' because the car fundamentally has to drive itself.
My guess is that once Waymo starts to extremely take off, law makers in various cities will start to pass laws to ban them or the number of regulations will make it impossible to run at a profit. This will almost certainly happen. It will disproportionately impact an entire segment of the population and will put them out of work.
You think the folks on City Council enjoy chauffeuring their own children around and will block a solution to it?
https://www.reddit.com/r/Minneapolis/comments/1pdzd2f/some_m...
> The bill prohibits the use of autonomous vehicles as motor carriers of passengers or property without a human operator who (i) meets any state and federal qualifications for the operation of an autonomous vehicle; (ii) is physically present in such autonomous vehicle; and (iii) has the ability to monitor the performance of such vehicle and intervene in the operation of such vehicle, including operating such vehicle without the use of the automated driving system and stopping and turning off such vehicle if necessary.
Uber and Lyft will survive exactly to the extent they successfully adopt self-driving.
Mamdani, the new nyc mayor, has been a long time friend and advocate for NYC taxi workers alliance. He even participated in a hunger strike with them in 2021.
Waymo is right now starting the wheels turning on getting NYC permits, but taxi workers have already made their (obvious) stance clear: No Waymos.
No they won’t. And Waymo’s playbook would be Uber’s if they did: preëmpt at the state and federal levels.
You also get some Starlink.
I guess Im questioning why Waymo doesn’t just IPO, or raise 100% private raise by Google.
He raises a good point, and the answer is likely that they can run into legal issues by either under or overvaluing the company in a capital raise where they're the controlling shareholder, then the IRS or existing investors have grounds for a lawsuit (or audit). They likely just want to bring the capital raise out in the open to get a fair market value, and then they will be 90% of the capital in the raise.
There are many reasons why a conglomerate like Alphabet doesn't want to hold all of that directly on the balance sheet, which is why Waymo is run as a subsidiary with its own sources of capital.
When I was at Uber 10 plus years ago and we were ideating autonomous vehicles. The general consensus was that we would run the technology platform and private equity would own fleets of cars built and operated to our specification.
Waymo has concluded either we are too early in the journey to decouple the tight vertical integration or they want to go very big and own all of the capital expenditure for what will presumably be a global rollout ultimately.
For anyone like me with a finance and technology crossover interest I actually think this is as interesting, maybe more interesting, than the private equity play around data centers at the moment because all of that is constrained against chip delivery and power constraints.
Also, keep in mind the Alphabet doesn't fully own Waymo. I don't know the percentage ownership of hand, but that also feels like it's probably a prorated investment based on ownership so Alphabet doesn't reduce its voting control.
That's what I'm talking about.
My finance people care about the cents, a ROI of 7% is average but at 8.5% and now you are a world class asset of that inventory type. That’s sometimes the difference of a few hundred k out of 20m but they would not take the deal if it is slightly over due to their risk appetite.
The 3b external either matters a ton to fit their risk models OR they are doing a favor to an outside party. Probably a bit of both.
Obviously you're entitled to your view, but I don't think it's that kind of finance model right now - it's far too speculative and the upside too unknown to be adjusting for small amounts on risk models.
They have made many comments over the years about this too.
Private equity, or private capital (debt investors)? Although I guess PC was less of a thing 10 years ago.
i.e. why should I use my money if I can use someone elses'?
That's the price for infinite scaling. If a business can't make more than that it should be shut down.
i.e. do you want to make 25% of 1 billion or 5% of 1000 billion?
There's also a strategic partnership angle in these rounds. For example, Magna and Autonation were early investors in Waymo. Magna operates Waymo's factory in Arizona to upfit their vehicles with sensors, Autonation (the huge dealership/service network) is the maintenance partner.
In general, the Alphabet playbook is that projects "graduate" out of Google X, and are expected to operate as a standalone company, including being responsible for raising funds.
This lets them validate their valuation and build a base of investors who could play a bigger role in writing chequew in the future. When IPO comes, those factors make the sell simpler.
institutional finance is america's most powerful lobbyist. in the sense of the fund managers, the little RIAs, the grandmas holding SPY. they ARE the voters.
so to me, aside from making money, making money this way, for a lot of people, protects them from the political grandstanding and their fast demise in their absence.
This. They're letting wall street in on it so wall street goes to bat for it. It's the big boy version of how some widget manufacturer will revise a product to necessitate or cut out a trade lobby depending on whether they want those people to go to bat for it, or make all the people who don't wanna pay rent to those people go to bat for it.
Why not 100% internal funding, not sure, but the reason why companies don't always IPO is because taking on debt is more efficient (i.e. it's cheaper in terms of cost of capital) than equity, because of the "tax shield" effect, debt can be raised in a non dilutive manner, and a few other (less important) game-theoretic reasons.
(Just experienced this multiple times in Phoenix. It’s impressive at navigating and braking, but not rational planning or flocking.)
Last earnings call Musk said Optimus wasn’t doing “meaningful work” at Tesla and as far as I’m aware they haven’t done meaningful work anywhere. I think they’re behind the curve there. Figure AI recently finished an apparently successful feasibility trial of their humanoid robots with BMW and Boston Dynamics has a deal with Hyundai for their Atlas humanoid robots.
I’m not even convinced humanoid robots are going to pan out in general. They only really make sense in a scenario where you’re back porting robotics to factories built for humans. That has value but feels temporary; factories designed to be robotic feel like the future, and there’s no need for them to do the job the same way a human would.
Slightly depressing that we're back to replacing the big industrial robots rather than new markets.
I would guess the long term strategy is to do this for economies of scale and then push into new markets opened up by the lower price point. I would guess these are horribly expensive right now, given something like Spot is way simpler and still like $40k
0: The magical creature, not a 1bn company
Tesla is the other way around. They can definitely make lots of cars and make a profit. But they haven't quite gotten FSD to the stage where it can do rides properly. Supposing they at some point figure that one out, they are very well positioned to start producing vehicles by the hundreds of thousands pretty soon after. That's indeed the premise for their valuation. It's risky but not completely without merit.
Another point to make is that Waymo and Tesla are not going to have this market to themselves for very long. There are quite a few autonomous ride hailing companies serving rides at this point. And while the attention is often on the US, China is moving pretty quickly as well. Several companies competing there in several huge Chinese cities, for example.
On the US side, I think there are a few players that might become competitive soon. Zoox is looking pretty solid. And Rivian is rumored to be pushing autonomy as well. There are a few more players in various stages of technical readiness.
The real battle will be in a few years when we are past the basic "does it work", "is it safe" questions and legal approvals all over the world become more routine. Then it will be all about volume and scaling. That's going to take probably at least until 2030.
And by this point, it seems like an electric-car platform already is close to a commodity, which is another reason for Waymo not to waste capital building another.
I still recall when taxi services were the only offering, and Uber et al were marketed as ride sharing services instead of ride hailing services. It's hard to put into words the transformative effect that ride hailing services had throughout the world. Overall rides are now far safer and more reliable, to the point where the old days feel like the dark ages.
I rarely take taxis, the exception is when I have to haul my gear to the studio for a jam session. I always take a taxi, because it’s cheaper and faster than using an app to call an uber.
On 80% of the trips, I end up having a nice chat with the driver and learn something new about humanity or myself.
I really enjoy these interactions, but I feel for the drivers, it’s a very tough job where most taxi drivers have to scramble to find places to urinate or do so in an empty bottle between their legs. There is not much dignity in the job. I feel a negligible segment enjoy it as a reliable career.
I wonder what will happen to the drivers if a large representation of the 1 million+ daily trips are displaced by automation?
It’s healthier for the discussion culture here as well.
My experience with taxis has been almost universally negative.
If it happens gradually enough, they will just find other jobs. So after the transition society will be producing more with the same labor force, and thus the aggregate utility will increase.
Public toilets, their condition and their non-existence are an often-overlooked issue! It's not just highly problematic for taxi drivers, but also for parcel and postal delivery people... and it's not just relevant for workers either, it's also (IMHO) a violation of anti-discrimination laws.
Imagine you're old and don't have much bladder control or volume, or you're a woman who recently has given birth, or you got one of the variety of bowel related diseases, or you've got a child who is still dependent on diapers. Your range of free unimpeded movement is basically limited to where you have easy and fast access to a toilet or at the very least a place to take care of yourself/a child.
Why the change? I think a big part of your experience is the fact that you "rarely take taxis." Once you're doing it daily or near-daily, the amount of smalltalk becomes more tiresome. Also, with kids and a busy life, I'm usually either looking to get things done or enjoy a rare moment to myself as I'm moving from place-to-place. I agree with OP that Waymo is a huge step up on those dimensions. There's no other human in the same space to feel awkward around.
The fact that they drive more safely and smoothly is a huge improvement, as well. Ironically, I thought this was going to be something I would hate about Waymo. "You mean it drives the speed limit and follows all the traffic laws? It will take forever to get anywhere." It took approximately one ride for my perspective to completely flip. It's so much nicer to not feel the stress of a driver who is driving aggressively or jerking to a stop/start at every intersection. It's not like you can tell them to just ease up a bit, either. When we ride with our kids, we feel massively safer in Waymos.
Yes, it will be disruptive, and I don't particularly love the dominance that big tech has in all of our lives, but I do think Waymo is a marvel, and I hugely appreciate it as an option. As soon as they can take kids alone to all their various activities, it will be yet another massive unlock for parents.
And now I have a family, there's 5 of us. A car is easily less than half the price of public transport for what I need to do (because you pay per person).
I hate traffic, and I don't really like driving, but since a car is easily 30 minutes faster than public transport to drive in to work, sadly 30 minutes of traffic in the morning is still faster than public transport, no matter how annoying it is. Oh and no waiting in the rain/cold is a nice bonus.
There’s nothing wrong with wanting a nicer more luxurious car for yourself. But it’s just ingenious to compare that against taxis with beaten-up and spartan but reliable cars.
Along with any interest on the purchase or foregone investment gains. You can use a true cost of ownership calculator here.
https://www.edmunds.com/honda/accord/2022/cost-to-own/?style...
Insurance alone can be 100€ a month (and more so for younger drivers). At a very modest 5 liters / 100km and a one way route of 20 km you're at 800km a month / 40 liters of gas => 1.80€ a liter => 72€ in fuel. Your average car then has 20 ct/km for maintenance costs (inspections, spare parts, oil changes, tires, workshop time), so another 160€ a month - and more if it is a run-down junker car.
That are just the fixed running costs you have with pretty much every car, around 330€ a month. We haven't talked about depreciation yet at all. Even if you say you buy a barely road worthy wreck for 3000 € and run it until it's only ripe for the junkyard to fetch maybe 500 € every two years, that's still about 100€ a month you're paying.
And what we also haven't had a single talk about is operating and purchase taxes, highway tolls, city-core tolls, rental spots for parking (including the price you have paid for the garage in your house, it's a lot of real estate), that also can easily add to many hundreds of euros each year.
Cars are expensive once you actually include replacement/depreciation and maintenance costs.
- cars becoming more complicated to repair. Marco Arment of Overcast related an incident where his Rivian had a simple fender bender, and his insurance was billed $15,000 in labor and parts to fix it because of the monobody construction where you have to tear apart half the car to fix anything
- inflation in both goods and services means car repair costs are going up
- more reckless and uninsured drivers thanks to general post-covid norm breakdowns
Insurance alone can now be $150-200/month even if you don't have a particularly nice car. Combine that with gas, maintenance, and registration taxes, and I think most people in the US are paying at least $350/month for their car even if amortized costs mean they don't realize it.
No we don't. Your github says you're from Berlin, why the hell would you ever need a taxi in your life?
Someone should just find a cure for for the fear techbros have of being near poor people.
Seattle has some of the highest per capital homeless in the US, and a dearth of public toilets, and yet there's not that much poop on our public transit.
I am also skeptical that y'all's violent crime rate is higher than ours.
Granted I haven't taken Berlin public transit in 20 yrs, so I don't know.
Ok well I am wrong. Berlin's violent crime rate is 2-4x higher than Seattle? Huh. The homicide rate is within touching distance.
That was not what I expected, ok.
Yes, I have. I never drove a car myself and maybe used a taxi 10 times in the last 30 years.
Will waymo even be available in less mainstream areas? It seems more reasonable for them to go for dense places instead and leave the unprofitable regions for someone else.
Ever is a long time. It's not reasonable to predict beyond a decade or so. It's easily possible that this becomes huge and in the 2040s people are astonished that "driving yourself" was a thing, the same way it's hard to comprehend now that most people weren't literate. Not "Couldn't write an essay / read a newspaper" but "Couldn't sign their name / read a postal address"
But it's also possible that this goes nowhere, and outside of a few large cities there is never a robot taxi market, it just doesn't exist. Waymo is, among other things, a bet that there is a large market.
Dense places are where it starts, but that was also true for the telephone. Bell didn't provide service to tiny rural settlements, they wired places like Boston and New York, AIUI the general service provision was a government initiative even in the US, it was never strictly profitable enough for huge corporations to spend their own money making it universal.
This isn't about poor people, at least for me, I'd much rather be alone than with Elon fucking Musk. If I want to hang out with people I will choose when and who. The least good bit of being in a taxi is small talk with the driver.
If Uber goes away, Lyft or others can take over the entire market overnight, precisely because they don't have their own fleet or unique technology. Waymo is placing itself as first mover into a completely new category of transportation which will require capital investment and new tech, so it will be much harder to displace once it gets going. It could target automated cargo transport in the future too.
Edit: there is a paywall in my country. Why downvotes? I’m just curious.
That said this is a tech forum, and while I don't think Waymo will be the only solution the tech is quite impressive and it's likely going to change how society works. Most people don't want to take public transit, they want to take a car and this is a much better solution for them. Forcing people to bike when they don't want to seems like bad form imo.
mankyd•2h ago