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Cognitive computing and artificial intelligence case - MIS 4596
- 1. Cognitive Computing and Artificial Intelligence: Self Driving Cars Angie Wang, Tim McNiff, Frank Tkcachenko, Jurgen Aliaj
- 2. Evolution of the “Market” ● Holistic market = automobile industry (personal transportation) ○ In the past, would need to purchase a car in order for convenient transportation ● Emergence of private transportation firms like Uber and Lyft created a new type of market ○ People enjoyed the benefit of on-demand transportation via cars without having to own one ○ Less expensive than purchasing a vehicle, but high costs associated with human driver in addition to vehicle ● Application of Artificial Intelligence can replace the need for human driver ○ New subsection of car market -> self-driving vehicles ● Many large car brands are ignoring the disruptive innovation of driverless cars powered by AI ○ Choosing to prioritize sustaining innovations rather than address the disrupting technology ● Reduced costs, increased safety (and reduced insurance premiums), and ultimately higher convenience of AI vehicles creates an increased performance that customers can utilize or absorb
- 3. Disruptions ● Adoption of autonomous cars will affect new car sales ○ Suggested that one driverless car is likely to replace as many as 15 – 20 traditional cars ● Taxis, Car services ● Public transportation ● Lower fuel consumption ○ Gas and oil ● Parking ● Insurance
- 4. Cost-justify / Evaluate Costs: ● Currently $75,000-$150,000 ● Expected to drop 90% within 7 years. Benefits: ● Lower cost of Uber/taxis ● Car insurance premiums will drop ● Less car accidents ● Improved traffic efficiency
- 5. Future of the Market ● Automobiles have been able to reach the third stage of autonomy. ● AI in sensors still needs to be more proficient to ensure safety. ● 99.9999% needed to move to commercially viable autonomy. ● The first predictable driverless car will most likely be robo- taxis. ● A co-existence transition period of a least a decade will have to be in place. ● The least amount of time to turn over all vehicles to driverless is at least 11 years according to US fleet regulations.
- 6. Works Cited ● Assis, Claudia. “AI in 2018: Waiting for Driverless Cars to Become a Reality.” MarketWatch, 7 Jan. 2018, www.marketwatch.com/story/ai-in-2018-waiting-for-driverless-cars-to-become-a-reality-2017-12-27. ● Autonomous Vehicles - The most disruptive innovation of a generation. (2017, June 14). Retrieved March 12, 2018, from https://disruptionhub.com/autonomous-vehicles-disruptive-innovation-generation/ ● "Disruption Cycle." 12 Manage. N.p., n.d. Web. 12 Mar. 2018. https://www.12manage.com/methods_christensen_disruptive_innovation.html ● Peters, Adele. “It Could Be 10 Times Cheaper To Take Electric Robo-Taxis Than To Own A Car By 2030.” Fast Company, Fast Company, 30 June 2017, www.fastcompany.com/40424452/it-could-be-10-times-cheaper-to-take- electric-robo-taxis-than-to-own-a-car-by-2030. ● Frazzoli, Emilio. “How Much Will Autonomous Driving Save?” MIT Technology Review, MIT Technology Review, 19 Sept. 2014, www.technologyreview.com/s/525591/can-we-put-a-price-on-autonomous-driving/.
Editor's Notes
- Disruptive innovation model is a theory used to describe the impact of a new (often revolutionary, in this case self-driving cars) on a firm’s existence. Time and time again, firms have failed because they did not address competing disruptive technologies, but rather catered to the most profitable customers As performance demanded by customers of an existing market increased over time, so does the performance provided within the technological paradigm (self-driving cars in the automobile market) Disrupting innovations vs. sustaining innovations Many large vehicle manufacturers choose to sustain their innovation and continue to make vehicles requiring human drivers Ignoring the disruptive technology Uber CEO, Travis Kalanick, has indicated in a tweet that he expects Uber’s fleet to be driverless by 2030. The service will then be so inexpensive and ubiquitous that car ownership will be obsolete. Most firms pioneering AI-driven driverless cars are technology companies like Google and Delphi, not typical vehicle makers, who aren’t prioritizing the innovation
- Adoption of autonomous cars will affect already dwindling new car sales One of the emerging trends in driverless technology is the growth of fleets. Uber has one in Pittsburgh, and Delphi is developing one in Singapore. These fleets will eventually offer different types of vehicles, for example single or multiple occupants. This will gradually remove the need for car hire and taxis, as well as affecting methods of public transport. Couple this with electric vehicles (which, incidentally, is exactly what Tesla Motors is doing) and suddenly there’s increased efficiency and less pollution due to lower fuel consumption. A decline in sales of petrol and diesel will obviously have a huge effect on companies in the gas and oil industries. It’s not just falling sales of fuel which will cause problems – in the U.S., car sales account for 40% of state and local sales tax. Of course, governments will find a way to profit from the so-called third transportation revolution and the changes that come with it. When it comes to businesses, autonomous vehicles have inspired new business models in which established automotive companies partner up with relevant startups – such as GM and ride-sharing app Lyft. In short, then, driverless cars have immeasurable disruptive potential because so much of our lives are built to accommodate standard vehicles. Once they begin to be replaced, all of that will have to change. Driverless cars will drop passengers off at their destination and go find parking elsewhere (or remain on the road if they are part of a ride-sharing program). The U.S. has about 144 billion square feet of total parking, which represents up to one-third of the total real estate in some large cities. Reports estimate self-driving vehicles have the potential to reduce parking space by about 61 billion square feet, which is about the size of Connecticut and Vermont combined. A reduction in the demand for parking can result in reclaiming this valuable real estate for more beneficial social and economic purposes. However, it also means significantly less money for cities through parking tickets. In 2012 alone, Washington, D.C. collected $92.6 million in parking ticket revenue. About 90 percent of car accidents are caused by human error. In the world of autonomous vehicles, we can expect to see a major reduction in the number of accidents, which will significantly change the insurance revenue model. As the risk of accidents drops, demand for insurance will take a sharp dive as well. In anticipation of this shift, some insurers are rolling out usage-based insurance policies (UBIs), which charge consumers based on how many miles they drive and the safety of their driving habits. https://disruptionhub.com/autonomous-vehicles-disruptive-innovation-generation/
- The current costs of the self-driving car’s hardware and software are very steep, ranging from $75,000-$150,000. The costs are expected to drop to $5000 a car by 2025 from development of technology and increased volume. Transportation in autonomous cars are expected to be 4-10 times cheaper per mile, which will make the self-driving taxi service much cheaper. Accidents are expected to be reduced by 75-90% in autonomous cars. The price of car accidents is on average $300 billion a year. Traffic will be reduced because AI cars can monitor each other’s position and coordinate their motion to minimize congestion. The cost of congestion, including lost productivity and health issues from pollution, is estimated to be $150,000 billion each year. The cost of charging a battery is less than buying gas.
- -Since the creation of automobiles humans have been able to reach the third stage of autonomy. - Sensors still need to get better for the ability to predict through snow or steam , maybe even a pedestrian not obeying walk signs , a traffic cop in place of a broken stoplight. - 99.9999% needed to move to commercially viable autonomy. - The first predictable driverless car will be likely robo taxis -A transition period of a least a decade will have to be in place for the coexistence of traditional and autonomous cars. -It takes at least 11 years in US to turn over the fleet so that’s the least amount of time to turn over vehicles to driverless