Uber faces an ever-growing cast of adversaries that includes dubious regulators, litigious drivers, hostile members of the press, and some well-funded rivals. But the most significant threat to the app-based transportation company may be much closer to home: one of its biggest investors, Google.
Google Ventures, the search giant’s venture capital arm, invested $258 million in Uber in August 2013. It was Google Ventures’ largest investment deal ever, and the company put more money into Uber’s next funding round less than a year later. Back then, it was easy for observers to imagine Google teaming closely with Uber, or even one day acquiring it. David Drummond, Google’s chief legal officer and senior vice president of corporate development, joined the Uber board of directors in 2013 and has served on it ever since.
Now there are signs that the companies are more likely to be ferocious competitors than allies. Google is preparing to offer its own ride-hailing service, most likely in conjunction with its long-in-development driverless car project. Drummond has informed Uber’s board of this possibility, according to a person close to the Uber board, and Uber executives have seen screenshots of what appears to be a Google ride-sharing app that is currently being used by Google employees. This person, who requested not to be named because the talks are private, said the Uber board is now weighing whether to ask Drummond to resign his position as an Uber board member.
Uber is also teaming up with Carnegie Mellon University for a research facility in Pittsburgh, Pa., to develop its own autonomous vehicle technology, the company announced on Monday. (The news was reported earlier by TechCrunch.)
Google has made no secret of its ambitions to revolutionize transportation with autonomous vehicles. Chief Executive Officer Larry Page is said to be personally fascinated by the challenge of making cities operate more efficiently. The company recently said the driverless car technology in development within its Google X research lab is from two to five years from being ready for widespread use. At the Detroit auto show last month, Chris Urmson, the Google executive in charge of the project, articulated one possible scenario in which autonomous vehicles are patrolling neighborhoods to pick up and drop off passengers. “We’re thinking a lot about how in the long-term, this might become useful in people’s lives, and there are a lot of ways we can imagine this going,” Urmson said in a conference call with reporters on Jan. 14. “One is in the direction of the shared vehicle. The technology would be such that you can call up the vehicle and tell it where to go and then have it take you there.”
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SOURCE: Bloomberg, Brad Stone