Alistair Barr

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Google may have begun as an AI company, but it will merely be a wildly successful search-and-ad outfit (for as long as that’s a money-making endeavor) unless its X division becomes a nouveau Bell Labs. Having a few of the moonshots land is paramount, whether it be self-driving car software or medical breakthroughs. The will is there, even if investors would rather Page, Brin et al., take the myopic view and settle for selling soap while algorithmically sorting selfies.

From Alistair Barr at the Wall Street Journal:

Alphabet Chief Financial Officer Ruth Porat warned repeatedly on the conference call that spending will increase this year, while Google Chief Executive Sundar Pichai laid out his own plans to ramp up investments in the company’s main Internet businesses.

On Monday, following strong fourth-quarter results, Ms. Porat said spending will increase in part to expand Alphabet’s fast Fiber Internet service to new U.S. citiesAn aggressive expansion of Fiber would cost tens of billions of dollars, noted Citigroup analyst Mark May. He expects Alphabet capital expenditures to climb by about $2 billion to $12 billion in 2016.

Ms. Porat also said Alphabet is committed to expanding its self-driving car business, which is currently testing prototypes in California and Austin, Tex.

These moonshots are part of Alphabet’s new “Other Bets” segment, which it said on Monday lost $3.6 billion in 2015, up from losses of $1.9 billion in 2014.

Mr. Porat also said that some of Alphabet’s biggest moonshots are inside its core Google Internet business — a division that’s supposed to generate the profits that pay for new, ambitious projects. Mr. Pichai said Google’s cloud-computing business will be a big area of investment in 2016, along with virtual reality and artificial intelligence.•

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Google’s all-or-nothing approach to driverless cars was apparently brought about because road tests proved the computer-human tandem incompatible. It was a punch to the gut of Google X at the time, but it forced the emergence of a fully autonomous vehicle. From Alistair Barr at the Wall Street Journal:

Google’s self-driving car project, one of the first to emerge from Google X, also faced major challenges, [Astro] Teller said.

In the fall of 2012, the team thought it had finished because it had built a car capable of driving itself safely on highways. Google gave some of the vehicles to other Google employees to use to commute to and from work and made them promise to continue paying attention to the road, Teller said.

“The cars performed flawlessly. The people did not,” he added. While not providing details, Teller said the employees paid less attention because they assumed the car would take care of any incidents.

“It was not pretty. We stopped doing it. We realized humans cannot be a backup system for the computer,” Teller said.

The team had to re-design a new vehicle capable to driving itself all the way from point A to point B with no help from a human driver. Teller said this was an “existential” blow to the team at the time.•

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Smartphones, revolutionary enough for doing what they do, are also having a huge impact through the repurposing of their components, aiding development of drones and robotics. From Alistair Barr and Scott Martin’s USA Today article about Google’s latest “moonshot”:

“Google has succeeded on big long-term projects before, such as YouTube and Android, and the company’s newer moonshots, such as self-driving cars and the Glass wearable computing platform, are beginning to show early commercial promise.

Robotics has been considered an emerging technology for decades, but for the most part it has been a disappointment. That may be changing, especially in the area of drones, according to Chris Dixon, a partner at venture capital firm Andreessen Horowitz. 

One of the main drivers of this is the rapidly falling cost of sensors and other components that are needed to maneuver drones and other robots. 

‘The promise of robotics is finally coming to fruition through drones,’ Dixon said. ‘Several factors have come together to make them viable.’

The price of components such as GPS, cellular connections, small, energy efficient processors and tiny cameras, has dropped dramatically because they are already made in such high volume for smartphones, he explained.”

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