Analysis: Why Uber and Waymo parked their self-drive dispute

Analysis: Why Uber and Waymo parked their self-drive dispute

Dispute comes to abrupt end as Uber pays out $245 million to self-driving rival.

Uber and Waymo have settled their dispute over stolen trade secrets.

The settlement brings to an end the long-running legal battle between the ride-sharing giant and Alphabet’s standalone self-driving division.

Uber is to hand over 0.34 of its equity value to Waymo – nearly $245 million – valuing Uber at $76 billion.

A year ago, Waymo filed a lawsuit saying that a former engineer, Anthony Levandowski, took thousands of confidential documents with him when he left the company. He subsequently ran Uber’s own self-driving division, but was sacked when Waymo sued.

The case has led to Uber falling well behind on its plans to use autonomous vehicles, and was a major factor in Uber investors ousting chief executive Travis Kalanick last June.

You’re Kalanicked!

The legal settlement came just four days after Kalanick himself took the stand in court. He was accused of organising a plan to steal more than 14,000 files from Waymo, before it was spun out from Google.

The jury was shown internal emails in which Kalanick demanded “pounds of flesh” from Google. However, Kalanik claimed that “no trade secrets ever came to Uber”.

“Our sole objective was to hire the most talented scientists and engineers to help lead the company and our cities to a driverless future,” he said. “The evidence at trial overwhelmingly proved that, and had the trial proceeded to its conclusion, it is clear Uber would have prevailed.

“I remain proud of the critically important contributions Uber ATG [Advanced Technoologies Group] has made to the company’s future, and I look forward to their inspired efforts becoming a reality on the roads in cities around the world.”

The settlement includes an agreement that confidential information from Waymo will not be included in Uber technology. It also allows Waymo to inspect Uber’s autonomous vehicle programme via an independent third party.

Uber regrets, Waymo protects

In a statement, Uber CEO Dara Khosrowshahi said he wanted to “express regret for the actions” that led to the lawsuit.

“We agree that Uber’s acquisition of Otto could and should have been handled differently,” he said, referring to the self-driving tech firm, founded by Levandowski, that Uber bought in 2016.

Waymo released a statement saying, “We have reached an agreement with Uber that we believe will protect Waymo’s intellectual property now and into the future.

“We are committed to working with Uber to make sure that each company develops its own technology. This includes an agreement to ensure that any Waymo confidential information is not being incorporated in Uber Advanced Technologies Group hardware and software.

“We have always believed competition should be fuelled by innovation in the labs and on the roads, and we look forward to bringing fully self-driving cars to the world.”

Internet of Business says

Whatever the small print of the case may be, it’s clear that the big message behind this settlement is, “Let’s move on”.

To say that the stakes are high for Uber, Waymo, and a host of automotive manufacturers, would be an understatement. The creation of a global autonomous transport system – on the roads and in the air – will be one of the big three economic battlefields this century, alongside clean energy and healthcare technology.

That this dispute went right to the heart of both companies’ corporate cultures should come as no surprise: Google/Alphabet’s desire to own as many markets as possible, and Uber’s reputation for muscling in on them by any means necessary.

The subtext should be clear: Uber’s long-term goal is building the infrastructure for personal, on-demand, driverless transport; Uber drivers have always been a means to prove the market, and never the market itself. Meanwhile, Google will want the data from billions of autonomous journeys.

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