The Reason Alphabet's Self-Driving Waymo Unit Is Creating Its Own Sensor Package

Selling components to others may be more profitable than building the entire car, which entails competing with both auto and tech companies. JL

Tim Higgins reports in the Wall Street Journal:

Waymo has said it doesn’t want to build its own cars. Instead, it sees opportunities to put its artificial-intelligence-powered technology to work in ride hailing, logistics, public transportation and personal transportation, including licensing it to auto makers for use in their vehicles.
Waymo LLC, the self-driving-car unit of Alphabet Inc., has created its own sensor package, suggesting the technology company sees itself supplying both the software and hardware required for autonomous vehicles.
The announcement  gives the clearest window yet into how Waymo might put its self-driving-car project into auto makers’ fleets. Bundling the hardware with the software required for self-driving technology would create an all-in-one package, allowing a car company to plug the technology into its vehicles without having to invest in its development.
“What we’re bringing to market is a self-driving technology platform,” John Krafcik, head of Waymo and former head of Hyundai Motor Co. in the U.S., said in a speech here. This “will allow us to deliver products and services that make getting around safe and easy for everyone. Some of these we may do on our own; some we may work on with partners.” Waymo has said it doesn’t want to build its own cars. Instead, it sees opportunities to put its artificial-intelligence-powered technology to work in ride hailing, logistics, public transportation and personal transportation, including licensing it to auto makers for use in their vehicles.
The revelation comes as traditional auto makers—unnerved by companies such as Uber Technologies Inc., Silicon Valley-upstart Tesla Motors Inc. and Waymo, which until last month was known as the Google self-driving project—rush toward self-imposed deadlines to bring self-driving cars to market in the next three to four years. Suppliers such as Delphi Automotive PLC also are trying to bring out all-in-one self-driving packages for auto makers.One impediment to the development of autonomous vehicles has been the high cost of sensors. In 2009, when the then-Google project began, Waymo says a single lidar—a radarlike device that uses lasers to give a computer a three-dimensional view of the world—cost about $75,000. The Waymo development brings the cost down about 90%, according to the company. Several other suppliers are seeking to develop lower-price and more compact versions.
The Waymo hardware package includes a continuous 360-degree-view radar, eight vision modules and three different types of Waymo-built lidars. It includes two new types of lidar sensors, including for short-range detection of small people and objects.
The Waymo hardware is included in a Chrysler Pacifica minivan shown Sunday at the Detroit auto show and that is expected to be on the road in Arizona and California later this month as part of Waymo’s continued testing, which has reached almost 2.5 million miles in the past eight years. The rate of when the automated system disengages per thousand miles traveled fell to 0.2 in 2016 from 0.8 in 2015 in California, according to Waymo on Sunday.
“Our sensors are deeply integrated with the brain of our self-driving cars, our all-new AI-compute platform,” said Mr. Krafcik. “Our self-driving software…combined with this Waymo hardware suite, is our most advanced self-driving system to date, it’s capable of full autonomy.”
The company aims to have driven a total 3 million miles by May as it increases the testing on top of the simulated miles it is accumulating. Alphabet last month made Waymo a stand-alone business unit, a sign of the potential it sees in its self-driving technology—and that the effort will soon be expected to generate revenue.