Uber Settles with Google Sibling, Waymo

Uber Settles with Google Sibling, Waymo

Uber has settled the lawsuit which Google sibling, Waymo, brought against it on trade secrets related to Lidar, a key component in autonomous driving vehicles. This has long been expected: Waymo may have a better technology, but Uber has the best product. Uber is light years ahead of Waymo on transportation which is what all these technologies are designed to advance. So, Waymo cannot afford to damage Uber to the extent that it cannot find a path to become a future partner. Alphabet, Waymo (and Google) parent, is an investor in Uber.

We have reached an agreement with Uber that we believe will protect Waymo’s intellectual property now and into the future.” Waymo statement

“To our friends at Alphabet: we are partners, you are an important investor in Uber, and we share a deep belief in the power of technology to change people’s lives for the better.” Uber CEO

Uber was expected to lead the way for Alphabet, and that was why Alphabet invested in Uber. See it this way: if Waymo invents this great technology, it would need a global transportation company to monetize it. Uber is well-ahead of other American companies in that space. Even though the lawsuit pushed Alphabet to invest in Lyft, most analysts believe that Lyft has no global future. With Didi already causing havoc around the globe, the only way Waymo can play a role is to see a strong Uber in the world. After all, Uber is partly owned by Alphabet!

According to TechCrunch, “The agreement also comes with a financial settlement of roughly $244 million in stock (that is 0.34 percent of Uber’s equity, valued at its Series G-1 round, which gave the company a $72 billion valuation)”. That is not close to the $1 billion Waymo has expected. It is also good the settlement is coming as stocks which ensures that Uber does not have to spend its cash on this.

I think everyone won by settling this case: Alphabet needs Uber to go after Didi which is now the hottest startup in the world. This lawsuit is a huge distraction to Uber. Now it is over, they would begin to plot how to handle their Chinese competitors who are also moving into making driverless cars with their own partners.


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