DIGITAL SHIFT. Navigating a driverless future

The development of autonomous cars is accelerating around the world. And with the pace of innovation picking up, disruption in mobility seems to be just around the corner. But the implications of driverless cars go far beyond car designs and transportation.

This is why companies such as Intel, Qualcomm, Nvidia and ARM feel the computing device of the next decade – akin to the position the smartphone holds today — could well be the connected car. Look at Samsung’s acquisition of Harman International Industries — the company is betting on transformative opportunities in the car.

Last fortnight in these columns we had briefly outlined how driverless cars will impact not just the automobile manufacturing industry, but also city infrastructure, energy, geopolitics, economies, our future habits and the society at large.

Let us now look at these implications in detail.

The first layer of change lies in the approach to car design itself. With vehicles becoming sensory and perceptive, the way we test tyres, brakes or any other auto part will radically change. Cars will transform their driving behaviours in response to road conditions in real time to minimise wear and tear to auto parts.

Moreover, driverless cars will open themselves up for new forms of innovation around services delivered to car users who no longer drive.

These services may include entertainment or productive work within the vehicle. That, in turn, will create a new ecosystem of service providers focused on the in-car experience.

So while automakers focus their attention on making the car a perfect machine, every other activity within the car — whether it is entertainment or office work - could be handled by partners, who build innovations on top of the car platform.

We are also staring at a future where the entire ecosystem around the automobile industry — maintenance and repairs, dealers, accessories, insurance — could see a radical shift. As cars becomes more sensory, they will need lower maintenance, and insurance as we know it today may cease to exist altogether. Ownership patterns will also change.

Some of the models of a driverless economy proposed include those where the ownership of the vehicle is with the government. If that happens, the car financing industry could collapse as well. Car sales may move from pushing individual units catering to consumer choice, to sales of entire fleets.

Road infrastructure is another layer that will get impacted, as everything from laning to traffic lights will need to be re-imagined. Driverless cars will increase greater capacity utilisation per car which is at an abysmal 4 per cent today. Higher capacity utilisation combined with lower ownership will lead to fewer cars on the road.

This will allow city planners to focus on creating sidewalks as activities like biking and walking become more accessible.

At a city level, we won’t need big parking lots or wider roads as idling cars would not be seen.

Important roads may start getting privatised, especially if micropayment can be implemented to tax actual road usage by driverless cars. Already a lot of thinking has begun on future roads. With fewer vehicles plying, roads will wear out much more slowly.

There could even be roads made of material that are power generating, either solar or through vehicle kinetic energy as the fuel of the future will likely be electric.

This leads us to a higher order shift in the works. We are already seeing a gradual shift to electric power and its impact on businesses. In the future we could see the creation of energy networks that distribute solar energy harvested by small businesses.

Companies that enable harvesting of natural energy sources like wind and solar, and that allow storage of this energy in high performance batteries, will fuel the coming economy.

And as the world shifts from oil to electricity, new geopolitical manoeuvres will begin. North Asia, where electric power grid interconnection schemes have gained traction and key players have successfully invested in battery technology, may become a dominant force with Korea, Japan and China emerging as power generating centres.

Adjacent industries will change as well. But the shift will be most perceptible in logistics and shipping.

As driverless trucks gather speed, and as factories as well as cargo loading and unloading get increasingly automated, supply chains will get efficient and automated.

Last mile pick up and drops could be managed through drones. There won’t be excess capacity or shortages as automated commercial fleets will run on a programmed rhythm.

At the societal level, there will be big impact on jobs. The nature of jobs will change.

At the white collar level, we are already seeing shifts in IT jobs where focus on automation is leading to new skill requirement and rapid redundancies.

At the blue collar level, truck drivers, who number millions will get heavily affected.

Within cities, autonomous cars could change the whole crime and surveillance game as well. Driverless cars which keep transmitting information could be used to keep an eye on cities, and crime may well reduce in this high surveillance world.

But with reduced crime will also come the liability of increased privacy invasion.

As with any connected system, cars can be hacked too. Technology, while agnostic in itself, amplifies the good as well as the bad, and driverless cars won’t be any different.

Paul Choudary is the author of Platform Scale and Platform Revolution and the founder of Platformation Labs, a C-level advisory firm. Narayanan is Editorial Consultant

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