Industrial subterfuge is nothing new. In 1712 Father Francois Xavier d’Entrecolles brought porcelain-making trade secrets back to Europe from China. Since then espionage cases have been scattered throughout history like invisible ink messages.
On the face of it the recent battle between Uber and Waymo, which concluded last week with a surprise $245 million equity settlement, was little more than another plinth in capitalism’s hall of shame: Company A covets Company B’s information; steals it, gets found out.
New Uber CEO Dara Khosrowshahi has been desperate to draw a line under the tawdry affair, during which Uber, under his predecessor Travis Kalanick, ran counter-intelligence operations designed to kill any aspirant to its ride-hailing and self-drive car thrones.
It was part of an effort Khosrowshahi characterizes as “reducing distractions,” he told a Goldman Sachs conference crowd in San Francsico this week. “Hey, let’s get this stuff away, let’s start executing as a business, because I think as an execution machine we have good people and we have good products,” he added.
But the trial was more than that. It was an example of how cutting-edge tech and a broey, winner-takes-all corporate mentality leads to immoral and illegal activity. Among the most shameful episodes to have been aired in court were reports Uber employees communicated on “Humint” – human intelligence – via secure messaging services, and spied on Saudi executives as they discussed a $3bn investment in Uber.
They’re actions that could have been lifted straight from a John Le Carré novel, had the British writer been brought up in today’s world of apps and artificial intelligence. That Kalanick, Silicon Valley’s very own comedy villain, sat atop it all, adds to the ignoble image Khosrowshahi will lose plenty of sleep trying to reverse.
Anthony Levandowski, the former Waymo star alleged to have stolen blueprints for Uber, will likely continue to thrive as a guru of the self-driving sector. It’s difficult to see how Uber’s immediate bottom line will be hit by a case that has evinced little but shrugged shoulders from Silicon Valley’s corridors of power.
Waymo can walk away from the case not just a quarter of a billion dollars richer – small change to parent company Alphabet – but buoyed by a victory against a key player in the imminent goldmine of self-driving vehicles. Intel has pegged the market’s value at $7tr by 2050, of which $250m constitutes just 0.003%.
The case’s biggest result, therefore, could be the way it is perceived by those with trigger fingers on all manner of regulatory and punitive measures, against a tech industry many politicians, entrepreneurs and users think has gotten out of hand. Khosrowshahi might be able to pass the buck of shame onto his forebear Kalanick. Whether he’ll convince Congress, the European Union and other bodies that his can be a benign rule, is another matter altogether.
The settlement in this confounding case may have passed. But its fallout is just beginning.