By Mitch Bainwol
Twelve years ago, I left one industry undergoing a profound technology transformation – music – and joined another: automobiles.
Music first. In one of life’s unplanned pivots, I joined the RIAA as CEO in the summer of 2003. Napster and subsequent P2P services had made illegal downloading so simple it didn’t feel either wrong or illegal to consumers. The iPod was the new hit – indifferent to the source or legality of music. Remember burning your CDs? Apple was just launching their digital store, iTunes, competing with the likes of Grokster, Kazaa and LimeWire, after navigating complex rights negotiations with the labels. Pandora was hot; Spotify was not yet a twinkle in their founders’ eyes.
The first call I got as the new RIAA CEO came from Steve Jobs, who barked at me for 20 minutes. I came away clueless about what he was saying, but keenly aware of his intensity and deep, passionate dislike for most of the label chiefs. When I said I would love to go out to California to see him in six months or so after I had settled into my new job, he muttered derisively that the world would be an entirely different place by then. The pace of change was that fast.
And so, essentially, it was. The era of plastic died quickly. As did the era of albums versus singles. In what felt like a blink of an eye, music moved from ownership to access. The same art that thrilled generations prospered, but the digestion of it changed forever. Technology worked its will.
Fast forward to 2011. Eight years after joining the RIAA, I found myself running another trade group (Auto Alliance) for an industry also undergoing profound change, this time autos. A few months into that gig, I went to Silicon Valley to visit Google. I had been there as head of the RIAA – and it was not a place that received an ambassador of “The Man” warmly. The culture of code had no patience for tedious questions of property rights, intellectual, or otherwise. To take down illegal content, Google required the rights-owner to fax the notice. Horse and buggy compliance brought to us by the algorithm-supremacists and purveyors of do no evil.
But this time I was there to learn about and take a ride in what was simply referred to as the Google Car. Back then, you googled autonomous car, and what popped-up first, of course, was the Google Car. Go figure.
It was a retrofitted Prius with a plugged-in laptop for navigation and massive, clunky Lidar adorning its roof. My guide that day was one of Google’s early pioneers who made his own dent in autonomy history – Anthony Levandowski.
Levandowski took me for a ride south on U.S. Route 101 toward San Jose. He sat in the front seat but turned around to face and talk with me as the car did its thing, adroitly dodging bad human drivers with remarkable nimbleness. Still naïve, I was sold, a converted member of the autonomy-is-going-to-change-our-life chorus.
Returning back to DC, I took the bet that autonomy was around the corner, blind to the challenge of “edge cases” –all the things that could potentially go wrong in the real world the designers did not expect – that still have not been resolved despite the compelling use case to eliminate distraction, drunk driving and expanding personal mobility.
By 2012, the popular concept was that the industry was about to transform dramatically – thanks to technology triggering four converging trends: autonomy, connectivity, electrification and sharing.
The destiny seemed like it was less than a generation ahead, and that destiny was prematurely declared to be access-based (like music, not owned), shared, electrified autonomous vehicles talking to each other and infrastructure seamlessly to form an ultra-efficient, safe, cost-effective transportation ecosystem. Or so we thought.
Today, much of the forecast has proved woefully off. The timeframe for full-fledged level 5 autonomy – requiring no human attention – now seems further away than it did that February day of 2012, when that still primitive self-driving Prius in sunny California warped my sense of reality. V2V and V2X communications, which allow for seamless sharing of wireless data between vehicles, surrounding infrastructure, pedestrians, and more has been championed by the government ambitiously from the Obama presidency forward. But this promising technology has been the victim of bipartisan policy ambiguity, a colossal failure of Administrations of both parties to referee competing claims about hardware and spectrum as the Federal Communication Commission reallocated a significant amount of spectrum in the 5.9 GHz band for unlicensed use (wifi). It will happen someday, perhaps, but it sure looks like it will be birthed instead through incremental market workarounds rather than an all-encompassing policy framework. And sharing of course has not – at least in the foreseeable future – shifted consumer behavior anywhere near the vision offered up when Zip Car, Uber, Lyft, Lime, Turo and other such services first penetrated the marketplace.
Today, it is electrification that is moving with greatest speed, well ahead of other automobile technology trends.
What happened was a fertile mix of policy, market and consumer dynamics.
Countries around the world – with California of course in the lead – set markers down for EV targets to help achieve carbon reductions. Whether this is for good or bad, depending on your philosophical perspective, doesn’t really matter. That’s a different debate. The reality was automakers were put on notice that the transition was going to occur, one way or the other. Pressure was on. Investment in change was demanded by government. And while the U.S. was late to the party with respect to EVs, the automobile industry had no choice as the rest of the industrialized world had spoken and the only effective way to achieve increased regulatory requirements was to offer EVs versus internal combustion engine vehicles (despite achieving all-time records in GHG and emission reductions).
Then came Tesla. The pre-Twitter version of Elon Musk made the vehicle like a pet rock, but faster and more fun. The market valuation of the company soared even faster than its cars and the rest of the industry took notice. For Wall Street, vision trumped profits.
And then of course, the Model 3. That less pricey Tesla model put the vehicle in reach to buyers outside the Brie and Chablis crowd. At the Auto Alliance I was tracking interest in EVs. There was no movement, at all, until the Model 3 came into the Market, and then bam. The race was on.
By 2021, Joe Biden gets elected president, the heat turns up on fuel economy, and the electric Ford F150 pickup truck goes public – re-defining what it means to be an EV. Then COVID dramatized the danger of supply chain dependencies, Russia invades Ukraine, and the relationship with China deteriorates. Massive investment pours into electrification here and around the world, the Bipartisan Infrastructure bill and the Inflation Reduction Act pass Congress and, suddenly, EVs are just as much about national and economic security as they are about climate.
Sure, the political class will continue to wrestle with details of policy, but the overriding national interest is clear. A strong America has no choice but to invest in electrification, its supply imperatives, and the charging infrastructure essential to the changing car parc.
Decades ago, record and CD players were cheap, and consumers turned them over quickly, transforming music in a comparative nanosecond. Cars are different of course, longer lasting and far more expensive. But no matter, a generation from now our kids will look at gas vehicles and they too, like the players of plastic content, will look like anachronistic antiques.
Mitch Bainwol is a senior advisor at The Brunswick Group, a critical issues advisory firm. He is the former Global Government Affairs Officer for Ford Motor Company, CEO of the Alliance of Automobile Manufacturers, and CEO of the Recording Industry Association of America.