Alphabet's self-driving car company tests free Wi-Fi and music

Students use the Waymo driverless vehicles to get to school.

Waymo is rolling out amenities to entice riders to use its self-driving taxis, creating a potential route to profitability in a money-losing industry.

The Alphabet subsidiary is testing complimentary Wi-Fi in its robotaxis in greater Phoenix, where hundreds of the company's identical, driverless minivans have been carrying paying riders since December. In late April, Waymo launched ad-free music streaming for passengers through Google Play Music, its parent company's answer to Spotify and Apple Music.

Waymo also has appealed to families with non-tech perks: It has installed a child car seat in every minivan and ensures vehicles arrive cooled to a precise 72 degrees in Arizona's desert heat.

The aim is persuading passengers that the company's ride service, dubbed Waymo One, is less stressful than driving their own cars or riding with its rivals. Chatty or sketchy drivers, and vehicles that vary in size and cleanliness, are top gripes among fans of ride-hailing apps.

"When I push the Waymo button I know exactly the product I'm buying," said Jordan Ranous, 26, a Phoenix bank analyst who said he takes four Waymo round trips each week.

The city of Chandler, about 20 miles southeast of Phoenix, last month began allowing staffers to expense Waymo rides for work-related trips with an eye to boosting worker productivity.

Waymo's challenge is to prove that hospitality and connectivity can generate profits. Waymo currently charges rates comparable to Uber and Lyft, whose reliance on fares has those firms bleeding red ink.

Eliminating drivers would slash Waymo's labor costs. Consistent, quality service might enable the company to charge higher fares, while internet, music and video streaming could generate extra fees or ad sales. Wall Street investment analysts have estimated Waymo's value at more than $100 billion, assuming in-car services contribute revenue.

"Those who win this space are going to have the most convenient solution and the best experience," said Mark Boyadjis, a global auto technology lead at research firm IHS Markit.

Waymo said its core business is charging for rides, not advertising during them. Providing "personalization" perks creates a sense of freedom, it said.

"Whether you want to catch up on emails or jam out to some of your favorite tunes using our music integration, we encourage riders to make this space their own," spokeswoman Julianne McGoldrick said.

Uber and Lyft, both of which are developing self-driving capabilities, declined to comment. Automotive firm Aptiv Plc, which has a year-old operation in Las Vegas with 30 robotaxis, said it does not offer in-car entertainment.

Source: CNBC

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