Something extraordinary happened last Friday night, and outside the world of Tesla fans and self-driving aficionados, hardly anyone seems to have noticed. In my opinion, August 25, 2023 was a red letter day for Tesla.
Allow me to back up and provide some backstory. Most of you know that I tend to think and write with metaphors and analogs, and this time will be no different. I’m going to use Google as my talking point.
See, I started my online computer journey way back in 1982 on 300 baud modems, and I was on the Internet in 1994. The search engines back in those days absolutely sucked out loud, in spite of getting hundreds of millions of dollars in funding.
If you used Yahoo back in the late 1990s, the search results were complete shit. Why? Because they were human-curated! Worse than that, they were totally corrupt. If you wanted to be in the search results, you have to pay Yahoo (unless they happened to stumble upon your site and deign to include it with one of their clumsy human meanderings on the early web).
Google had an utterly different approach. Their insight was so brilliant and simple that everyone kicked themselves for not realizing it earlier: just count the number of links any given site had from other sites. It was a form of passive voting. If tons of sites linked to a specific site, surely that must mean something, so this “back rub” method won the day. Thus, Sergey and Larry became centi-billionaires.
Once people started using Google, it was instantly clear to them what absolutely garbage stuff like Yahoo, AskJeeves, and Excite were, so everyone else went straight down the toilet and Google went on to become a trillion dollar company.
The bottom line is that Google didn’t represent another marginal improvement in search, but was an entirely new paradigm. And that is a term (paradigm) that is misused here in the Silicon Valley constantly, but in this instance, it truly applies.
Which brings me to self-driving. Humanity has been trying to get cars to drive themselves for literally decades. I remember as a little boy in the 1970s seeing my neighbor’s new car had something called “Cruise Control“, which I naively thought would make the car drive itself. In more recent years, a host of well-funded companies have been working slavishly on this challenge, and most of their cars resemble hideous monstrosities which are nothing short of embarrassing.
Thus, car makers have kept tacking on contraption after contraption, new code after new code, and tweak after tweak, onto their cars, trying to seduce them into more or less driving properly. This hasn’t gone very well, and in places like San Francisco where there are actually a handful of self-driving cars that attempt to taxi people around, the citizens have practically rioted at the regular disasters of these robotaxis suddenly stopping in the middle of a major intersection and tying up traffic for an hour.
This all changed, I believe, with what is a fundamental breakthrough with how Tesla is tackling this problem. The analog, in my estimation, is along these lines:
Tesla:All Other Car Makers::Google:All Other Search Engines
Of, if you prefer another analog, this one might be even more appropriate:
Tesla:All Other Car Makers::iPhone:All Cell Phones Preceding 2007
In other words, the way Tesla is solving this incredibly complex problem is through a combination of a unique mountain of bespoke video data (that no other company can have, so it’s a trillion dollar moat) couple with an engineering breakthrough that allows the car to truly drive like a human. The drive which took place on Friday has been neatly edited down by one Tesla fan:
Arthur C. Clarke famously wrote, “Any sufficiently advanced technology is indistinguishable from magic.” This is one of those instances in which that old saying definitely applies. Whether or not this will be reflected in Tesla’s stock price in the near-term isn’t particularly important. I do believe, however, that Tesla may wind up being the most valuable company on the planet five to ten years from now, and it fills me with pride for reasons I’ll only disclose some time in the future.
