Why Tesla FSD Will Have its Dolby / VHS / Betamax Moment
Kurt Thywissen
Software Guy. Design Thinking, Product Innovation. Ex Tesla, NIO, THOR/Airstream, Skype, Apple.
(Sub Title: The Car Industry “needs more Dubly”).
Wanted to take some time to share some thoughts I’ve had the past six months or so and what legacy auto makers need to understand about autonomous driving, Tesla’s foundational role, and how Elon Musk continues to remain (to many annoyingly so) unequalled in terms of strategic foresight coupled with bold execution: always several chess moves ahead of everyone else.
But first I want to go back ten years. When I joined the Tesla software team in 2013 (departing 2016) I remember vividly the first internal company wide meeting I got to attend at the Fremont factory. Tesla had just shipped the Model S with maybe twenty thousand cars in the market.?It was at that meeting Elon announced internally his intention to build a Giga Factory to meet future battery demand. It sounded crazy at the time, both exciting and bold, yet fully consistent with the first principles thinking that supported the strategy. No other OEM was thinking in these terms at the time, and we can make similar comparisons on the foresight of the Tesla Supercharger network buildout that was well under way.
Six gigafactories later we arrive at today and recently I’ve been using the latest Tesla FSD release. It’s good. It’s REALLY good. With a network of over a million cars and billions of miles of training data Tesla finally has a fully neural net powered AI model, designed and built by some of the smartest AI machine learning engineers in the world atop a cost effective sensor suite, that is, in my opinion,?unmatched (and I’ve experienced the nearest competition, including Waymo and more recently WeRide in Beijing). Alas I never got a chance to try Cruise…
And much like the giga factory announcement 10 years ago we just got news that Tesla is doubling down on cloud compute to power the (re)evolution of FSD to support not only its growing fleet but to extend the gap it has over the rest of the market. Again, he’s several chess moves ahead, and I would make the claim that Tesla’s lead in FSD will continue to grow exponentially making it practically impossible for anyone else to catch up for years, maybe even a decade. In biz-tech speak what we’re seeing here is first mover advantage & network effect combined.?
I'd like to also postulate that over time Tesla will also demonstrate empirically with data that it has by far the safest self drive technology by a long shot. People often forget Elon puts safety at the very top of his requirements list, that Tesla has in reality an unmatched safety record (despite what you might otherwise read in the popular press).?
What this all means: Tesla FSD becomes the standard.?
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Next chess move: Last year it occurred to me it was not unrealistic to expect Tesla to open up its FSD stack to other auto makers (Remember when it “gave away” all its patents?). Heh presto Elon shared this very intention recently, with at least one undisclosed OEM already interested.
Which brings me to why I use the phrase “Dolby / Betamax moment”. When Dolby released its noise reduction tech in the 1960s it quickly left the competition in the dust and became a licensed standard that would ultimately become embedded in every consumer audio device on the planet. It would pioneer the encode/decode model so you needed Dolby tech to master (analog encode) your recordings in the studio and again playback (analog decode) to get the best fidelity on your device. Obligatory Spinal Tap quote: “It needs more Dubly”: https://youtu.be/7sz5OrACPn8?si=4rLq6rgbp8IncmXq
With best in breed tech, a first mover advantage, and affordable to license, Dolby became the standard for decades.
I view Tesla FSD in a similar light. The technology gap, the unmatched safety, the network effect: Tesla FSD has a good shot at becoming the Dolby of autonomous driving.?And maybe it should: for safety sake. And as other auto manufacturers start to adopt it you get the consistency of a unified stack embedded increasingly in the majority of autonomous capable cars further ensuring predictable safe behavior all running the same “autonomous OS”.
Sure, there maybe other FSD players that try nip at Tesla’s heels, but Tesla is the VHS / Dolby gorilla and all the rest are the Betamax guys. As an OEM you have to ask yourself how much more money do you want to throw at autonomous drive R&D when you are going to end up being the Betamax? There will no doubt be case studies in MBA programs about this in years to come. ?
Conclusion: Automakers should focus on their core strengths for differentiation in the market place: brand, market segment, price, shape/form, styling, performance etc. OEMs: save your money, get out of the FSD race. “Add some Dubly” instead by licensing Tesla FSD much like the consumer electronics industry adopted Dolby back in the 1960s. It’s game over in the FSD race and Tesla FSD is Dolby.
(If you are interested in more of my thoughts on software and software defined vehicles, feel free to send me a DM here).
Software Guy. Design Thinking, Product Innovation. Ex Tesla, NIO, THOR/Airstream, Skype, Apple.
9 个月This podcast aligns with my sense of where Tesla is in the competitive landscape and if it is poised to cross the chasm first.
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9 个月Hi Kurt Thywissen , great analogy and agree there needs to be industry wide standardization. Curious to hear your thoughts about Mercedes Benz Drive Pilot vs FSD as Mercedes is the first OEM getting a level 3 certified and approved in the US vs FSD which is still classified in level 2.
Hi Kurt, maybe in regards of FSD Elon puts safety first. However, if you look at OSHA statistics of all of his companies they all fall short in worker safety. He is brilliant but a person with very little empathy when it comes to work place safety and job security. His safety standards are as bad as his panel gaps. It can be fixed but it's not important to him. Apart from that you may be correct about FSD and VHS. Time will tell.
Owner, Partner & Advisor. Digital marketing & BD pro. All around swell guy ??
9 个月Love this line of thinking, Kurt, and not just because I spent time at Dolby right before we worked together at Skype ??. A few thoughts that might be worth thinking through: While I had long contemplated Tesla’s move to make its Supercharger network and connector the de facto industry standards, I hadn’t considered the FSD system the same way. Always thought of it as a proprietary differentiator for the vehicle. If, however, the current fleet is “just” there to bootstrap both the charging network (to bootstrap the connector as de facto standard) and and to train FSD (to license it out as well as the standard) well then… VHS won because it had 2x the recording time and was much cheaper to license & manufacture from JVC. The home cameras were also cheaper and became the standard in the p0rn industry which helped drive home player demand. I feel like the real analogy here is Tesla:JVC::FSD:VHS Dolby Surround was probably not a huge factor in VHS’s victory in that format war. And remember most VHS hardware was not made or sold by its owner, JVC. Anyhow! Marginal thoughts on a really thoughtful post. I look forward to a future Acura powered by FSD that comes with Supercharger network access!
Coach & Author of "Breaking Asphalt: Choosing the Steeper Path to Greater Goals"
9 个月I sold my Model Y last year. It was my 2nd Tesla and 3rd electric car. I paid $10k for FSD and it nearly caused several accidents while I was driving it. Thankfully I do what you are supposed to do and keep my hands ready to intervene. After years and years of promises, I gave up on FSD and Tesla largely due to Elon's erratic behavior, lack of focus on making one company great for its customers, constant repricing, and his politics ... I could have over looked them, but I lost faith and trust in the product. I know you are smart and don't make such big statements lightly. Perhaps things have turned a corner and I acted in haste? Either way, I have to say I am enjoying driving again and am a more active, present, and alert driver than I was with FSD.