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Apple Won't Make a Car (Toyota Already Does)

by Roger Lanctot | Feb 28, 2015

Thanks to the Telegraph we now know that Apple’s Tim Cook gets up at 3:45 in the morning. That may explain why Cook thinks the Apple Smartwatch will replace car keys.

In the quiet of the early morning hours there is a clarity of mind that comes. All problems suddenly seem less complex and the mind is open to “aha” bursts of inspiration.

It is easy to see Cook considering the clunky keyfobs and jangling bundles of keys as ridiculous holdovers from bygone times – modern-day buggy whips. Why are we still carrying around keys and fobs? Why can’t we simply use our smartphones or, better yet, our smartwatches to operate our cars?

This is both the beauty and the challenge for a Silicon Valley company entering the car market. That first interaction with the industry inevitably leads to smirks and gasps of disbelief from the Silicon Valley crowd: “Is this how you guys actually conduct your business? It takes you three years to bring a car to the market and it is instantly out of date?”

It all makes for great mirth from Milpitas to Menlo Park. Tim Cook’s tossed off comment to the Telegraph that the Apple Smartwatch will replace cars keys was a classic case of this kind of hubris. But it’s not really hubris. It’s just garden variety naivete.

Does Tim Cook really think that it has NEVER occurred to an automotive executive that there might be an alternative to car keys? There is no question General Motors would love to do away with car keys entirely after its ignition switch recall disaster of 2014. Of course, automotive engineers have been hard at this issue for decades.

The surprising thing is that Cook’s naivete persists a year after Apple brought CarPlay onto the international stage at the 2014 Geneva Auto Show – and we’re STILL waiting for it to get to market – on the eve of the 2015 Geneva Auto Show. In fact, Apple doubled down with a follow-up performance at the New York Auto Show last year with senior executives on the automotive team doing demos on OEM stands throughout the Manhattan event.

But we’re still waiting.

So much for showing the auto industry how to launch a mobile application platform…

But this failure to recognize the scope of the challenge and the time required to overcome it reflects Apple’s true colors – the shallowness of its commitment to and interest in the automotive industry. Many bloggers have posited their image of Steve Jobs as either obsessed with or fascinated by the automotive industry and cars.

Reality check: In Walter Isaacson’s biography of Steve Jobs there is a single important and relevant reference to cars:

“…I recounted what (Bill) Gates had said after he described his last visit with Jobs, which was that Apple had shown that the integrated approach could work, but only ‘when Steve is at the helm.’ Jobs thought that was silly. ‘Anyone could make better products that way, not just me,’ he said. So I asked him to name another company that made great products by insisting on end-to-end integration. He thought for a while, trying to come up with an example. ‘The car companies,’ he finally said, but then he added, ‘Or at least they used to.’”

Jobs was no car guy. He respected cars for their industrial design qualities.

But his comment reflects a deep understanding of the history of the automotive industry. The car companies of old, which made and controlled the manufacturing process of the vehicle from beginning to end – these companies once embodied the vary paradigm of what Apple had become. Jobs seems to be suggesting that car makers are no longer equal to the challenge of making great product – or not, at least, until they retake control of the entire design and manufacturing process.

Jobs’ father WAS a car guy, or at least more of one than son Steve. In fact, Isaacson says Paul Jobs put his son through college on the basis of the money he made, off the books, from buying, fixing and reselling old cars. He often brought Steve along on trips to junkyards to acquire parts, giving his son an early lesson in recognizing value and haggling along with an exposure to automotive electronics.

But for Steve Jobs, cars represented transportation and the power of design. It’s amusing to note that Jobs preferred to drive around Silicon Valley without a license plate in a futile attempt to preserve anonymity.

As for Apple making cars, Cooks’ comment about replacing keys with smartwatches reveals his and Apple’s ignorance of the challenges and, by extension, a lack of respect for the magnitude of the task at hand and, most likely, a clear indication that a car is not in the company’s future.

According to multiple industry contacts, but with a special contribution from Voyomotive, here is a summary of the requirements for a smartwatch/carkey replacement:

  • Connecting to cars will be different than controlling a car. Apple will need an OEM’s cooperation to control this functionality and most likely the car will need to be using CarPlay.
  • Apple will need to add hardware to the car and the vehicle will have to be designed around this hardware. Lead times are a consideration to implementation and market penetration.
  • Requirements include: Bluetooth communication with the vehicle “off;” however, it has to be very low power. System must be able to wake up the vehicle, support encryption and security. All of these are doable but are considerations to implement the system.
  • In the case of multiple users, Apple will need to differentiate permissions between different levels of users and Apple has traditionally NOT supported this type of functionality. For example, having different types of permissions for people who can enter the car vs people who can drive the car. (Once you are on an IPad – you have total access to everything.)
  • To reach the aftermarket and/or non-CarPlay vehicles, the Apple Watch will require additional hardware be added to a non-supported car to authenticate access and engine start. One model requires a custom install as used by ZipCar and other car sharing companies or a modular, plug and play system like Voyo.

So, it’s fun to toss quote bombs to reporters for the purpose of gaining a lot of attention and spreading fear, uncertainty and doubt (FUD). But FUD only works if you actually have something in the works. Apple appears to have nothing more to offer than fear, uncertainty and doubt – and the auto industry already has a surplus of those commodities.

Which brings me to Toyota. Yes, Toyota.

Toyota is the only car company that has publicly defied both Google and its Android Auto smartphone integration and Apple’s CarPlay. This does not mean that Toyota is not communicating with both of these companies. It is impossible to ignore Google and Apple, after all. But Toyota is wise to watch and wait.

Toyota’s decision to hold back reminds us of the following:

  • Infotainment (and smartphone integration) is still a low priority element of the car buying decision making process;
  • Any solution from Google or Apple added to a car will NOT be differentiating and will only serve the purposes of Google and Apple;
  • Google and Apple are NOT adjusting their business models to fit the auto industry, they are forcing the auto industry to bend to their will;
  • Google and Apple have zero respect for the automotive industry’s priorities and business requirements – i.e. liability exposure.

Car companies want to work with Google and Apple. Google and Apple want to work with car companies. Until there is a level of mutual respect established between these organizations any outcome is destined to fail. As for an Apple Car or an Apple smartwatch/key replacement? Neither of these things will happen, no matter how many headlines or blogposts they inspire.

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