Tesla, Patents, and Ideology

Next time the world is getting you down, just remember that there’s a major car company that uses internet memes from the 1990s in its publicity.

You may have heard that Tesla Motors recently released all their patents to the world for free. Here’s Tesla CEO Elon Musk’s explanation for why he took this somewhat unorthodox move:

“Tesla Motors was created to accelerate the advent of sustainable transport. If we clear a path to the creation of compelling electric vehicles, but then lay intellectual property landmines behind us to inhibit others, we are acting in a manner contrary to that goal. Tesla will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology.”

When it comes to the charging infrastructure, there is a very good reason why Tesla might want to do this. By allowing anybody to build a supercharger station on their own initiative and on their own dime, Tesla is effectively downloading the risk of building their infrastructure onto other people. Given the growing popularity of and excitement around Tesla cars and electric cars more generally, I would be very surprised if there wasn’t a significant number of people who saw a local electric car charging station as a good investment. This will help reassure potential buyers that they can count on having charging stations available nearly anywhere, which will in turn help Tesla sell cars.

The decision to release all the patents on the cars themselves is a bit more puzzling. I’m not going to presume to fully understand its reasons or its implications. I’m not a patent lawyer, and while the efficacy of patents is discussed in the academic circles in which I travel, it’s not really my topic of expertise. It will be interesting, however, to see whether this leads to more electric vehicles being built using Tesla technology, to compete with Tesla. Maybe this will open the door for specialized electric vehicles such as buses, delivery vans, or construction vehicles. Maybe a bigger ecosystem of competing electric vehicles will give Tesla an edge by further legitimizing the technology, which Tesla will retain their lead in due to their considerable experience making them. Or maybe they will be awash in cheap knockoffs within 10 years and be driven out of all but the luxury car market. It’s probably a good move for the planet, but as for what it means for Tesla, it’s probably too early for me, or anyone, really, to say.

But one thing that is interesting about this is the language that Musk uses to justify the decision. He is using the anti-intellectual property language which has been developing for some time now in opposition to the software and entertainment industries. Musk is, at least apparently, putting this language into practice in a very big way. In fact his blog post makes explicit reference to the open source movement. Of course, it’s possible that Musk is just paying lip service to the idea of open source, while he is actually releasing his patents for purely business reasons. Political figures like Musk always attempt frame their actions by reference to whatever ideology or symbolism is trendy at any given point in time.

But even if Musk is merely posturing, there is still something interesting here. The ideology of the open source movement is becoming increasingly important. Virtually anybody who knows how to program a computer and doesn’t stand to make a lot of money from patents will say that it’s a good idea. Google and Mozilla both make liberal use of open source software, and creatives, such asAmanda Palmer and the guys behind Cards Against Humanity all openly encourage the pirating of their work.

Maybe the recent development at Tesla is a signal that this ideology is starting to effect how the technology business works. If more technology companies follow the example set by Google and Tesla, then it could mean a big change in how technology gets developed. It would fundamentally change the rules by which engineers and entrepreneurs play, the effects of which are probably too complicated for anybody to realistically predict. And that would have some kind of effect on the kinds of technologies that get developed, the speed with which they get developed, and the ease with which they diffuse into society.

If that’s the case, then this is evidence of something that is constantly ignored in discussions of business and technology: ideology matters. Economists and policymakers like to assume that firms and engineers are perfectly rational calculators who follow their business sense and whose behaviour is basically predictable. But who could have predicted the rise of the open source movement? Ultimately, Engineers are people. And so are entrepreneurs. And like all other people, they filter their perceptions about the world through a lens of ideas, assumptions, and principles, and that changes how they act, and has a profound impact on the technologies they develop. That means that technology, like anything else, is susceptible to the influence of culture. Most intriguingly, it means that we can influence technology purely through ideas.

A few more thoughts about self-driving cars

The two Steves behind the Freakonomics franchise have just released another book, in which they apparently criticize self-driving vehicles. Unfortunately I currently have neither the time nor the money to read their book, so I’ll have to rely on this blog post from the Wall Street Journal, which seems to sum up their argument pretty well:

“Driverless cars could turn out to be a scourge on humanity.

They may lead to a worldwide surge in binge drinking since drunk driving would no longer be a worry. They also could be vulnerable to hacking by terrorists who send every self-driving vehicles in the western U.S. plunging into the Grand Canyon.

And by making car travel easier, driverless vehicles could lead to more congestion and pollution.”

They also cite the potential for self-driving cars to eliminate jobs (something I’ve addressed here) , though they also apparently admit that self-driving cars could reduce the number of car accidents.

I’m going to criticize the freaks’ approach to the issue, but I want to make clear at the outset that I don’t mean for a second to suggest that their predictions are implausible. They could be right. While the terrorism thing seems a little bit far-fetched, the result of this technology could be a world full of long-distance commuters in self-driving vehicles. This would contribute to vastly expanded urban sprawl, congestion, pollution, climate change, and oil resource exploitation. That is a plausible scenario, and it is a bad one.

Despite this, however, I think that the freaks’ logic is badly misguided. To illustrate why, it helps to point out that at the turn of the twentieth century, one of the most common destinations proposed that somebody would drive to with the newly invented automobile was the railway station. Cars, it was assumed, were mainly for local transportation or transportation through areas too remote to have their own rail lines. But if you wanted to go to a big city, then the train was your best bet. What this illustrates is that people always understand new technologies in terms of old ways of doing things. Historically, very few people have been able to accurately grasp the real implications of a radical new technology at such an early stage. That’s like trying to predict what the political landscape will look like in fifty years: It’s simply too complicated to accurately assess in advance. The best you can do is a lucky guess.

Levitt and Dubner, then, have probably made a mistake in assuming that the self-driving cars of the future will be used in same way that people use manually-driven cars today. This is not necessarily the case, however. Self-driving cars, in fact, open up a whole new range of possible behaviours. I’m going to explore one possible scenario, which I think is predominantly a good one, using two short speculative vignettes. The idea is to illustrate how everyday habits and lifestyle choices could be completely transformed by autonomous vehicles. Here’s the first one:

Julie was tempted to buy a car. That was, after all, what you were supposed to do when you got your first salaried job, and she did need to commute 20 miles every day to the office where she worked. But the autonomous taxi service that she had been using for the past year already served that purpose just fine. It meant that she didn’t have to drive or maintain a car. And the self-driving taxis were cheaper to boot. She decided she would rather spend the extra money on travel.

A huge part of the price of a taxi ride is the labour. That makes perfect sense, as taxi drivers need to make ends meet. But when you take the driver out of the picture, then suddenly taxis become a whole lot cheaper. This is especially the case if the self-driving taxis are electric, which will save considerably on fuel costs. I don’t pretend to know exactly what the price per mile of a self-driving taxi in the year 2040 will be, but it is plausible that it will be cheaper for the average person to rely on them than drive their own car. Self-driving taxis will be used far more efficiently than private cars could be; will be maintained by efficient, cost-optimizing businesses, and won’t have to pay for downtown parking.

This could start to make car ownership far less compulsory, even for those of us who live in the farthest-flung suburbs. Even if reliance on a self-driving cab is slightly more expensive than owning a car, it could still be a very attractive option due to the added convenience. And that means fewer cars on the roads.

“Alright, Andrew. We’re done predrinking. It’s time to go to the bar. I’m calling a cab”, said Stephen.

“Ugh. A cab? Do we have to? I’m kind of broke, and that’ll cost me like two beers”, replied Andrew. “It’s only three blocks away. We can make that in like half an hour”.

“Yeah, okay. Screw it”, said Stephen. “Let’s just walk.”

People who own cars tend to use them. Once you’ve paid the very substantial cost of a car, the marginal cost to use it to drive half a mile to the store becomes insignificant. So even if driving to the store is on balance a more expensive way of getting there than walking; this doesn’t translate into any direct perception of expense by the person deciding to drive to the store.

If, on the other hand, people rely on self-driving taxis, then the marginal cost of driving to the store suddenly goes up. Even with the vastly decreased price of a trip compared to a normal taxi, the fact still remains that the traveler has to pay upfront. And that means that many people will look to save money by walking or cycling for shorter trips. That means fewer cars on the road in total.

The ultimate outcome of these trends could be fewer cars on the street, more efficient use of the cars that remain on the street, and more electric cars. That would also mean more use of active transportation; more incentive to build high-density, walkable cities, and a more sustainable transportation system in general. As soon as you start to reduce the rate of car ownership, you reduce the incentives for car use. The neat thing about self-driving cars is that they allow a reduction in car ownership while allowing the same rate of car use to be maintained, at least temporarily. That makes them an ideal lever for changing the makeup of our transportation system and our cities, in addition to their recognized benefits in reducing drunk driving and accidents, and offering more travel options for the disabled.

Of course, my scenario is just as uncertain as the one proposed by the Freakonomics guys. Most likely, the way this will actually play out is completely different from either of our predictions. But my scenario suggests a few takeaway lessons. Firstly, it illustrates the value of a transitions perspective, which uniquely takes into account the complex ways that new technologies can interact with society. Secondly, it suggests a program for action. We can, to some extent, control the way that self-driving cars are introduced, through government policies and social advocacy. Self-driving cars could be good or bad in the end, but for the moment they’re an opportunity to change our transportation system. And we should think about how to take advantage of that.