Google's driverless car project goes from research to business

Waymo is unveiled as a new business under the Alphabet umbrella

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Martyn Williams

Google parent company Alphabet is taking its autonomous car effort to the next level.

John Krafcik, CEO of Google's Self-Driving Car Project, announced in a blog post Tuesday that the company's effort to build and test a driverless car has gone from a research project to a business.

"Since 2009, our prototypes have spent the equivalent of 300 years of driving time on the road and we've led the industry from a place where self-driving cars seem like science fiction to one where city planners all over the world are designing for a self-driven future," wrote Krafcik, in the blog post. "Today, we're taking our next big step by becoming Waymo, a new Alphabet business."

Waymo, which he said stands for a new way forward in mobility, will be a business operating under the Alphabet umbrella, much like Google, Nest Labs, GoogleX and Google Fiber.

"We're a self-driving technology company with a mission to make it safe and easy for people and things to move around," wrote Krafcik. "We believe that this technology can begin to reshape some of the ten trillion miles that motor vehicles travel around the world every year, with safer, more efficient and more accessible forms of transport."

The company has been a key player in propelling autonomous vehicle technology.

It has been testing its driverless cars on city streets and on highways, logging millions of miles.

Waymo will work on developing not only personal autonomous vehicles, but also other types of vehicles, such as delivery trucks and buses.

"In the long term, self-driving technology could be useful in ways the world has yet to imagine, creating many new types of products, jobs, and services," Krafcik wrote.

The move to take the project from research to a full-fledged business signals that the technology has hit a critical stage in its advance.

"It's a big deal in that research has gone far enough that it's close to being productized," said Patrick Moorhead, an analyst with Moor Insights & Strategy. "We are likely three years away from having a car with Google self-driving capabilities."

But Ezra Gottheil, an analyst with Technology Business Research, said going from research project to business unit is more of a "ceremonial recognition" than a major leap.

"There will be still be a lot of research, but there will be business plans, milestones, budgets, etc., that are built around getting to a profitable business," he said. "It's a change from semi-pure research to semi-pure business." He estimated it will be another five years away before anyone is driving a car with Alphabet's autonomous technology.

And Alphabet is unlikely to get into the vehicle manufacturing business. Instead, the company is likely to partner with auto manufacturers that will use the Waymo technology.

While the announcement is significant for Waymo, Moorhead said the company is still behind autonomous vehicle competitors like BMW and Tesla.

Copyright © 2016 IDG Communications, Inc.

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