Thursday, October 13, 2022

Automotive industry increasingly at Google's mercy: discontinuation of Android Assistant Driving Mode (after Android Auto for phones) reflects and reinforces monopolization--Tesla is the last man standing, but for how much longer?

Last month I already expressed concern over car makers' structural inability to respond at all levels--including legislation, regulation, and litigation--to Apple's and Google's ongoing "carjacking" effort.

Meanwhile, the EU's Digital Markets Act has been published (the historic moment was yesterday)--a bill that can help automakers, but only if they seize the opportunity. A couple of years ago their lobbyists were incompetent enough not to veto a submission by Germany's big-industry association BDI that (fortunately unsuccessfully) sought to dissuade the Commission from taking the initiative that led to the DMA. The German Automotive Industry Association (VDA) appears to be a hot mess anyway when it doesn't stay in its original lane, as I'll show again further below.

Two weeks ago, the Wall Street Journal reported on the next big battle between Apple and Google being for the "soul" of your car. Philip Elmer-DeWitt, who's been covering Apple since--lo and behold--1983, quoted a few paragraphs from the article. PED's headline sums it up: "Apple or Google: What's on your dashboard?" And his take: "Google's got a head start, but Apple will do a better job and charge more." As someone who just ordered a Google Pixel 7 Pro and would have done so even at price parity with the iPhone, I wouldn't necessarily agree that Apple inherently "do[es] a better job"--but the part about "charg[ing] more" is beyond reasonable doubt.

This week, Google did what it habitually does: it discontinued an offering. As I mentioned in connection with Google's lobbying against Microsoft's acquisition of Activision Blizzard King, there's a digital graveyard named KilledByGoogle. Google's nonchalance about shutting down services is no small part of the reason why its Stadia game streaming service failed: who would invest in anything that isn't Google's core business, i.e., search? TechCrunch wrote: Stadia died because no one trusts Google Some even doubt Google's enduring commitment to its Google Cloud Platform, but count me out: GCP is great, and Google needs a huge cloud operation anyway to run its search engine. For now, I'm sure GCP will make Google a lot of money further down the road.

This week's major Google killing isn't good news for the automotive industry. Google is shutting down its Asisstant-powered Driving Mode for Android. That dashboard--launched only in 2019--is going to be deactivated on November 21, 2022. And it's been only a few months since Google actually killed off Android Auto for phone screens.

As a result, one needs a car with Android Auto, which by now applies to the vast majority of cars out there" and is also a lot safer when driving. In fact, in some countries using Android Auto on a phone screen while driving would be illegal.

Alternatively, one can activate the Assistant Driving Mode in Google Maps (which will hopefully fall under the DMA, as I discussed in September). Google says--and independent commentators seem to agree--that many people preferred the Assistant Driving Mode within Google Maps over the standalone feature anyway.

This pair of killings--within months of each other--is bad news for the auto industry in two ways:

  1. It reflects the fact that Google has won: apart from only one major holdout--Tesla--the industry has adopted Android Auto. So Google can easily deactivate certain functionalities on phones as the vast majority of users can--and should--use Android Auto on the built-in screen, which means Google doesn't have to develop for and test on totally different form factors, and drivers are less likely to lose sight of the road that way.

  2. It also means that car makers can't just tell customers who use Android--people like me--that we don't need Android Auto as we could just use Android Auto on our phone. Now the only alternative to a car with Android Auto built in is the Assistant Driving Mode in Google Maps: less functionality than the standalone Assistant Driving Mode (even if most people hardly knew it), which in turn wasn't a full substitute for Android Auto on phone screens.

For how much longer will Tesla be able to resist? I want to be honest about this. I was considering buying a Tesla, but I viewed it as a major shortcoming that I wouldn't be able to use Android Auto. My new car will be delivered next month and come with Android Auto like my current one. As a user, I demand Android Auto. As an app developer and a big believer in competition, I have a problem with Google's and Apple's "carjacking" and believe lawmakers and regulators must protect the automotive industry, such as by ensuring that Android Auto and Apple Car Play will be made available on fair, reasonable, and non-discriminatory (FRAND) licensing terms, without the kind of tying that would effectively give Apple and Google control over ever more revenue streams of connected vehicles.

In other words, my attitude toward Android Auto depends on which hat I'm wearing at a given time, the only exeption being the following:

When I activate Android Auto, it always starts Google Podcasts. Owing to Google's self-preferencing (not as bad as Apple's, but almost), one can't easily deactivate or uninstall its own apps. I deleted it from my phone, but that changed nothing about Android Auto's behavior. Really annoying for users, and bad for competition. Others have also criticized that auto-activation (apparently YouTube Music may also start playing music even without users wanting it to happen automatically).

What can the car industry do? Like I've said before, they need to bring in digital policy knowledge (such as by hiring people with a tech industry background). They must work a lot harder and smarter on the legislative, regulatory, and litigation fronts. They failed to understand the potential of the DMA. If they were foresightful and not as narrow-minded as they are, car makers would have supported Epic Games against Apple alongside the DOJ, three dozen U.S. states, professors including the #1 U.S. antitrust scholar, Microsoft, the Electronic Frontier Foundation, and others. Today's app tax is tomorrow's tax on digital services in connected vehicles. They still could support Epic when that case goes to the Supreme Court (whoever loses in the Ninth Circuit--I predict Epic will gain a lot of ground with at least a partial reversal--will be sure to appeal further, even if only after a potential remand).

Instead of tackling the clear and present danger of being reduced to "sheet metal benders" as Volkswagen's former CEO accurately put it, they waste money on standard-essential patent (SEP) policy (for instance, automotive companies supported Continental's absurd U.S. litigation against Avanci that went nowhere and which I criticized already more than three years ago). And the German Automotive Industry Association (VDA) embarrassed itself with a submission to the DOJ that is unworthy of a "professional" lobbying entity:

German Automotive Industry Association (Verband der Automobilindustrie--VDA) embarrasses its members instead of intelligently advocating their digital policy interests

Earlier this year, Germany's Automotive Industry Association (VDA) participated in a U.S. government consultation on SEP policy. The submission itself was well-crafted; presumably it was written by U.S. outside counsel. But look at the accompanying email (click on the link to visit the governmental website where it appeared, or click on the image to enlarge):

  1. "Dear Ladies and Gentlemen" is a verbatim translation of "Sehr geehrte Damen und Herren." It's just not how you want to address the DOJ.

  2. "Enclosed" is the wrong word--you can attach documents to an email, but can't enclose them in the absence of an envelope or box.

  3. It would also have to be capitalized in this instance.

  4. There's no "please" or similarly courteous word there.

  5. "Statement"--not "statememt." (Word choice is another question.)

  6. The dot after "SEP" is incorrect.

  7. Let's not even talk about the stylistic issues with "on questions of SEP licensing."

  8. "Regards" is not appropriate when writing to the government.

  9. "Department Law and Compliance"--they mean the Legal (Affairs) Department, not the "law of departments" (if such a thing exists).

That's a number of Germanisms plus some typos on top.

That industry needs to get its digital policy act together. They failed to soften Germany's strict patent injunction regime as I just explained again in the previous post. They achieved nothing with respect to the licensing level. They proposed a buyers' cartel that would organize group boycotts, which is simply contrary to the rule of (antitrust) law. And they still don't seem to have understood the urgent need to act in the field of digital platform regulation. There may just be too many people in that industry (and its lobbying organizations) who are too close to retirement to care.