Legal & Regulatory

Strict Regulation Challenges Self-Driving Cars Starters

November 5
5:59 AM 2016

The NHTSA was asking for proof that the Comma One device was safe, with a threat to block its sale if the proof was not provided.

Last week George Hotz, founder of Andreessen Horowitz-backed self-driving car startup Comma.ai, announced that because of a threatening letter from the NHTSA, he would cancel his company's plans to build kits that retrofit cars to drive themselves.

One side effect of software creeping (barging) into every sector of the economy is that technologists are now butting up against rules and regulations they didn't face when they were just selling ads and data storage.

Despite the lessons learned from Uber and Airbnb's regulatory stumbles, some startups still prefer pure, unadulterated, "leave us alone" disruption.

Hotz was practically baiting regulators with his over-the-top proclamations and blustery conference speechesOr that self-driving kits like the Comma One operate in a legal gray area with little more than a loose set of guidelines in place. Or that building amazing technology and dealing with regulators and lawyers are not mutually exclusive. Hotz decided to take his ball and go home, an approach that, unsurprisingly, met a fairly negative response online.

It is possible that Comma, which has less than a dozen employees, was already re-evaluating its plan to sell aftermarket kits. The company's self-imposed year-end deadline for launching that product is fast approaching. The founders of Cruise Automation made a similar pivot after they realized how many makes and models they'd have to integrate their kits with. If Comma was already planning a pivot, the NHTSA provided a convenient excuse and an on-brand rallying cry to go with it.

Some players in the self-driving industry are nervous about wild card startups like Comma.ai. It reminds of the time Oculus VR CEO Brendan Iribe warned virtual reality headset competitors not to "poison the well" by introducing a product that wasn't ready. In other words, a bad first impression could hurt the entire category. With self-driving cars, the stakes are so much higher than sub-par VR kits: It's a matter of saving lives.

This summer, after the Tesla Autopilot  TSLA 1.80% fatality, I interviewed David Strickland, former NHTSA regulator and current counsel to the Self-Driving Coalition for Safer Streets, a lobbying group that includes Uber, Lyft, Ford  F -0.09% , Volvo, and Google  GOOGL -0.14% .

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