Equities
Lachlan MacGregor

Overnight Trump signed an executive order that allows the US to ban telecom network equipment and services from foreign adversaries. This is clearly aimed at China and its telecom equipment champions Huawei and ZTE. The Commerce Secretary can ban companies that have close ties to foreign governments as they could... Show More

Equities
Lachlan MacGregor

Disney’s transformation to a streaming ‘Netflix’ business model is an unprecedented step for the company. Any business transformation is hard, and in Disney’s case its streaming competitors are well advanced or determined and well capitalised. Netflix launched streaming in 2007, and Amazon and Apple are among the competition. But Disney... Show More

Lachlan MacGregor

Whilst innovation continues to present long-term opportunities in the technology sector, the outlook for 2019 is less certain given pending trade negotiations. I just got back from visiting over 50 technology and communications companies in San Francisco, Silicon Valley and Seattle, looking for investments that aren’t dependent on the outcome... Show More

Lachlan MacGregor

In December I published an article concluding that Google’s Waymo autonomous car division was well ahead of the competition. I stand by that assessment, and its hardly controversial. But I underestimated how much Tesla’s promotion of its own efforts were confusing customers and potentially investors about their place in the... Show More

Lachlan MacGregor

Apple significantly reduced its guidance for the December quarter, blaming China and a few other factors for the shortfall. This is Apple's first negative pre-announcement in over a decade, since at least the launch of the iPhone. The announcement came after the US market closed and Apple's shares are trading... Show More

Lachlan MacGregor

Autonomous transport still seems like science fiction: we know it is bound to come eventually, yet it is difficult to imagine in our daily lives. But self-driving cars are becoming a reality rapidly and this month Alphabet (Google) took us a step closer to that future. Waymo, Alphabet's autonomous car... Show More

Lachlan MacGregor

Cable media stocks fell sharply after AT&T announced video subscriber losses, following Comcast and leading to $60 billion being wiped off their valuations. Investors love Netflix but competition is coming. Amazon may move into the $560bn prescription drug market. And more exciting technology developments in transport. Show More

Hi Jovan, I agree, I don't think we should dismiss Tesla. In particular they potentially have a strong advantage in autonomous by collecting data from their existing customer fleet. My comment was perhaps too flippant as I needed to keep the article short. However many in the industry are skeptical about their approach to autonomous driving which is different to the rest of the industry. The key difference is they are opting not to use LIDAR sensors, which are sensors which use laser signals in a similar way to radar to produce a very accurate and precise three dimensional image of objects. Musk argues it isn't necessary to use LIDAR, which are currently expensive, and says they are "a crutch" to the rest of the industry. Instead Teslas are equipped with eight cameras supported by a forward facing radar as the primary technology, and 12 ultrasonic sensors for 360 degree vision. Waymo on the other hand uses three different types of LIDAR sensors, five radar sensors and eight cameras. The supporters of Tesla's strategy say that cameras combined with the advancements in machine learning will be sufficient - after all, that is what human's use. If Musk is right then Tesla should be able to develop a cheaper autonomous system and would have an advantage (though I note that Google is focused on reducing the cost of LIDAR and has reduced the cost by 90% already). But Tesla's is a higher risk strategy and may compromise their path and timing to full autonomous driving. The advantage of being first is likely to be huge given both the ride-share business model (natural local oligopolies) and the scale advantages of cost and autonomous learning opportunities. Tesla's skeptics say that the decision not to use LIDAR was forced on Tesla - they wanted to equip their existing fleet with sensors to collect data, yet couldn't afford to put LIDAR on vehicles. Some believe that Tesla know LIDAR will be necessary and will add this down the track. And coming back to the first point I made about Tesla's data. That data is potentially Tesla's real advantage as it has a fleet of tens of thousands of cars collecting data. Some argue that this data is unmatched by other makers, but I would be careful of direct comparisons. Tesla's data isn't of the same quality - they have access to the cars speed, acceleration and braking as well as short video clips. But this data is anonymous (not connected to a car), probably not contiguous and likely very difficult to train a system on. Waymo's data is far more detailed, using LIDAR and collecting the full suite of contiguous data about cars and their situations. Waymo then build full computer models and run simulations with thousands of scenarios. Don't take the simulated miles as a disadvantage vs the real thing - but rather as an important step to test the full range of scenarios. In summary, I'm certainly not dismissing Tesla and they are making great progress on a limited budget. They are doing much better than most automakers, whilst simultaneously disrupting the car industry with electric vehicles. Incredible. But I am skeptical of some of their statements which generate a lot of PR but are often not robust - like Musk's boast in 2016 that a Tesla would drive autonomously from coast-to-coast in the US by the end of 2017 (it still hasn't happened). The rest of the industry are consciously taking a different approach, and I can see why Tesla need to have taken their approach. I'm keen to hear if you see it differently though and why you think that Waymo maybe doesn't have a lead?

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