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Google cars will become stand-alone business

By raccars Published

Google Garage

From stand-alone Alphabet unit to independent company; the future for Google’s car business.

Alphabet Inc, Google’s parent company, is graduating the firm’s self-driving car operations as part of plans to evolve it to become a stand-alone entity. Instead of being part of the company’s research lab X work, X boss Astro Teller said that it would be taking a major step towards stand-alone status as part of the journey to commercial operations.

The finances of the car group were made separate from the X lab at the start of the year and the team is now completing a range of legal and corporate moves which will see the project become a business in its own right. The moves were confirmed by Teller at the recent WSKDLive 2016 tech event.

New era for Google cars

As a stand-alone operation under Alphabet, it is likely that the car business would be expected to start generating revenue in the near future, although this is unlikely to mean profits in the early stages. Teller has refused to reveal the planned business model as yet.

He said that the future would see some cars being sold to individuals whilst others will be shared and the firm had not yet decided upon which of these markets Alphabet would focus. He said that this question was being considered but that the main focus right now was on safety.

Teller indicated that Alphabet is planning to launch its self-driving vehicles incrementally over a period of several years in order to capitalise upon improvements which will be inevitable as they spend more time out on the road. It is possible, for example, that the group may launch cars in just a few cities with good weather and road conditions before expanding to encompass a wider range of climates and challenging road conditions.

Teller compared the idea to teaching teenagers to drive and the way in which a parent might at first keep their hands near to the steering wheel before letting them drive alone during daylight hours, eventually letting them go out whenever they wished. He said that all companies 'acting rationally' would probably choose to follow a similar path in order to evolve safely, requiring that vehicles are rolled out in ‘constrained ways’

Other companies with self-driving cars firmly in their futures are already choosing to deploy the technology gradually and many are harnessing semi-autonomous technology as an interim measure. This means that drivers must be prepared to take control if required. Teller confirmed, however, that the cars created by Alphabet to date and those planned hereafter will be totally autonomous from the outset. He said that drivers would simply hit a button and let the vehicle know where it is they wanted to go.

Graduation on the cards

The CEO of Google's self-driving cars operation, John Krafcik, has also announced that his business unit is now prepared to ‘graduate’ and become its own entity beyond Google. Speaking at Palo Alto’s Nikkei Innovation Forum, Krafcik said that this ‘graduating project’ was symbolic of the latest Alphabet structure, where new individual entities are being formed within the wider corporate environment.

Automotive veteran Krafcik said that the plan was for Google cars to move away from X and, subsequently, away from Alphabet, meaning that it becomes an entirely separate entity. He did not say what the autonomous car unit would be called in the future but indicated that it would achieve its independence ‘soon’.

In a similar move, it was decided last December that Google Life Sciences would become a Verily Life Sciences spin-off which would focus on the use of technology in understanding health and to detect, manage and prevent disease.

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