Benner on Tech: Can Apple's Car Beat Tesla's?

Katie Benner is a Bloomberg View columnist who writes about technology, innovation, and the cult and culture of Silicon Valley. She lives in San Francisco.
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Would you drive an Apple car?

Reports that the company is working on an electric automobile have people (and investors) very excited for chief executive Tim Cook’s version of a slick roadster. The Wall Street Journal says it could be a van. If Apple can make a van sexy, then it’s truly the king of industrial design.

An Apple car might not hit the road for years, but people I’ve spoken with who love their Teslas -- people who can afford a luxury car -- say they would be game try whatever electric vehicle the guys in Cupertino might deliver. As we've seen with Apple Pay, Apple is good at forging relationships and distributing new things with the help of big, existing networks such as credit-card companies and banks. Dealerships are a huge, powerful piece of the U.S. auto industry, and one that Tesla has shunned. While that probably won’t hurt Tesla in the long run, it creates the sort of friction that a smart, fast-moving, well-capitalized competitor -- one that understands supply chains and production -- might possibly try to use to its advantage. 

But any competition between the two companies is far in the distance. Why should Tesla worry about such an amorphous headache when it has near-term issues to focus on, such as capacity constraints and missed revenue and profit numbers? 

Apple is recruiting auto experts, and dozens of employees are already working on the project, which is code-named Titan. The company doesn't have to produce an actual vehicle for this strategy to be important and useful. The connected home still feels like a weird luxury for people who love to show off the fact that they can turn on a light with their phones. But there are real reasons why one might want a connected car, primarily safety.

When we drive, we already access the navigation and entertainment tools that live on our phones -- maps, music, search engines and the ability to call and text contacts. Putting those tools in the dashboard where it’s easy to access with big buttons and voice commands seems like the logical thing to do. And the company that becomes the go-to platform for this dashboard will gather all of that very valuable data that we generate when we travel, including where we go, eat, sleep and spend our money.

Apple and Google have introduced CarPlay and Android Auto, respectively. Both products are pretty buggy, in large part because they feel like appendages rather than integrated parts of the automobile. Here’s how the Verge put it:

The problem is that the combined Apple-Google push into the dashboard exposes a patchwork of troubling fiefdoms inside the car's circuitboards. Different functions may or may not be controlled by Auto. For the ones that aren't, you must exit Auto and adapt to an entirely different user interface designed not by Google, but by Hyundai. ... CarPlay, in many cases, will suffer from the same kinds of arbitrary divisions. There's no rhyme or reason to it apart from the hardware topography. Some functions are actuated by chips in your phone, some by chips in your car. That's an utterly meaningless distinction to the driver.

The only way to figure out how to integrate the software and the hardware is to really understand the hardware, which a team dedicated to building out a car would be able to do. Cook has emphasized that the reason Apple can charge so much money for its products is because the company integrates hardware, software and services better than any other tech company out there. The car is a whole new way for Apple customers old and new to experience the company, and it’s important that it’s more than just a buggy version of the iPhone experience.

Related: The New Yorker has an-depth profile of Jony Ive that’s the perfect thing to curl up with on a cold wintry day.

Ventureland

Gilt Groupe has raised $50 million in new funding and will delay its initial public offering, Re/code reports.

Pebble, one of the original smart-watch makers, now supports Android Wear notifications, VentureBeat reports.

Quirky is the master of crowdsourced invention, according to the New York Times.

Yik Yak’s growth is flatlining, according to GigaOm. Might anonymous snark and vitriol be a passing fad?

China’s leading taxi hailing apps are going to merge, which will leave Uber with a very tiny piece of the market, Re/code reports.

People and Personnel Moves

President Barack Obama talked to Re/code about cybersecurity, encryption and regulation.

Astro Teller talked to the New York Times about how he plans to make money at Google X.

Companies

Amazon…

Hopes for drone deliveries have been squashed in the wake of new FAA draft regulations, USA Today reports.

Apple…

The company ordered more than 5 million units for the Apple Watch’s initial run, the Wall Street Journal reports.

Cybersecurity Blotter

A Russian cybersecurity firm says that the U.S. has embedded spyware and other sabotage tools in computer networks in countries including Iran, Russia, Pakistan, China and Afghanistan, the New York Times reports.

Hackers in Gaza have been attacking Israeli websites, the New York Times reports.

News and Notes

China’s Tencent is in talks with Ford to make a messaging function its cars in China, the New York Times reports.

This robot is better at Tinder than you are, according to the Atlantic.

Cloud computing comes with its own hidden waste, according to the Wall Street Journal.

This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.