The Industry

Did Waymo Just Put Uber in Second Place?

The Google-owned company is launching a self-driving car business in Arizona. Uber should be relieved.

Uber's self-driving Waymo minivan.
It’s coming. Brendan McDermid/Reuters

The courtroom fight between Uber and Waymo is over; now the race to get an autonomous ride-hailing service to market is back on. On Friday, we learned that Waymo—the self-driving car arm of Google parent Alphabet—has made one huge stride: The company applied to become a transportation network company in Arizona on Jan. 12, and its permit was approved on Jan. 24, Quartz reports. This nod from the Copper State means Waymo can begin operating a commercial service that would compete with human-powered ride-hail companies like Uber and Lyft, charging passengers for rides in its self-driving Chrysler Pacifica minivans.

“As we continue to test drive our fleet of vehicles in greater Phoenix, we’re taking all the steps necessary to launch our commercial service this year,” a Waymo spokesperson told Slate.

Waymo has slowly been making progress toward this goal, beginning with extensive real-world testing in Phoenix. Waymo first began offering hailed rides from its self-driving fleet there in early 2017, through its early rider program. These rides, limited to a 100-square mile area of the Phoenix metro, were free to those who participated. While these rides were first accompanied by a technician behind the wheel, in November Waymo began operating these vehicles completely autonomously. Now Waymo has taken the next step, and can start acting as a business rather than a beta program on Arizona’s roads. Details as to when exactly it will begin charging for rides, what that pricing structure will be, and when it will roll this out to other areas of the country are yet unknown.

The move is ostensibly bad news for Uber, which has also been fighting to get its own self-driving car fleet up and running. In 2017, it was sidelined by its intellectual property spat with Waymo, which was settled in court last week. Still, Uber’s not that far behind: The company is in the advanced stages of self-driving vehicle testing in Pittsburgh with a pilot program that offers rides in self-driving vehicles when you order an uberX. In fact, Uber beat Waymo to the punch with this program—it began in late 2016. Uber also began conducting self-driving vehicle testing in Arizona last year.

While the start-up’s autonomous-car efforts may now be racing to catch up to Waymo’s commercial status, Uber is actually in an excellent position: It now has the “second mover advantage.” In the past, as the leader in the ride-hailing space, Uber made a number of missteps, both internally, as it’s had to deal with widespread reports of sexual harassment and numerous executive shakeups, and with its expansion efforts—such as when it lost its license to operate in London last year. This has enabled competitors such as Lyft, moving at a slower pace, to improve its own foothold in the industry. With its self-driving car efforts too, Uber has made mistakes. It failed to get the proper permitting with the California DMV to test its vehicles on San Francisco roadways, temporarily forcing the company to relocate its testing fleet to Arizona. Uber’s beta efforts in the city were then further tested after a crash was reported in August.

Perhaps, now that the company is under new management, it’s time for Uber to abandon that famous motto of another Silicon Valley giant: “Move fast and break things.” Rather than fret at its position and rush its self-driving development efforts, the company should take a moment and learn from what its first-to-market competitor does. Plenty of second movers have ended up succeeding in the long run—Google’s popular search engine is a prime example of one. Uber’s job now is to learn from the pain points of Waymo and its users, endeavor to improve upon them, and offer not necessarily the first self-driving ride-hail service on the roads, but the best one.

Should Uber be worried by Waymo’s progress? Well, the company shouldn’t sit back and kick up its heels. But it should also breathe a sigh of relief. Perhaps someone else can make the mistakes for a change.