I remember standing in line to put my $1000 down on a car I have not even seen.  The excitement was like the first release of the iPhone, but without the wait.  So jump 2 years and my M3day was last month.  I love the car, although I wish the ride was smoother but I could fix that by changing the shocks… and I wont.  However, what I have found is that I love showing people the car.  I get excited talking about the fact that there is no dash.  LOVE showing the self driving.  The new electric motor the M3 uses, the smooth acceleration, how it looks, even the cool way the air vents operate.

Now there are things I would love to change now that I’m 30 days into my M3day.  I would really like to edit the UI.  Perhaps one day they will provide an API where I can code up my own via markup or directly in c++ or however they do it.  I’m also waiting for the self drive to improve and expand.  For example, the system should be smart enough to lean into a turn.  Right now the car still tried to keep the center line in a turn and ends up hugging the far line a bit too much for me and the unlucky person driving next to me.  This should be a simple algorithm fix.  (I work in computer vision for VR for a living BTW).  These details not withstanding, watching peoples eye light up as I let the car drive itself is so much fun.  I also love when people first sit in the car.  Its one thing to tell people, ‘no instrument panel, just a screen’ and then having people actually sit in it.   The comment I get all the time is, ‘ah so this is the future’.  And yes, I think it is.   Just like when I first got the iPhone and jailbroke it, I could see, this is where all phones are going to go.   The M3 is the first car in my mind that will signal, this is where we are going and I love sharing that.

BTW, why not say this about the S?  I drove the S a few times and really loved it, and it felt like really great electric car, but because of the dash, I still felt like I was in a normal car.  Also, the car felt too big, too many ‘features’ that were not really necessary, etc.  In other words, like the first iPhone.  Really cool, but not quite there yet. The dash-less experience with the M3, smaller more practical, only things on the car is what is needed on the car felt like a much cleaner design and more inline to what I would want in a car.  So like my iPhone 3G, yes the 2G gave me the first glips of the future, but the 3G is where I really experienced it, and so with the M3.

Technical

The obvious thing is technically what they pulled off.  Using multiple xbox sensors (I’m not sure how many) they are able to do full body tracking.  Because the user’s vision is completely obscured by the HMD, they can place the xbox sensors and light it to provide the maximum effectiveness for body tracking. Hand and head position most likely are sent via closed wifi to the gear.  From there its rendered in (Unity?). As you can see in some of the shots, not only is head positional tracking going on, you can see your hands on the rope as you walk across!

This is great. Now add wind, cold air and sound (notice there we saw no headphones so the sound was most likely piped in), and you have a very deep immersive experience,  Because the Gear VR is wireless, the user is not restricted by cables.  In fact, once you are immersed, and given all the other sensory input, your brain can have a real fight deciding what is real and what is VR.

Even better is the fact that you put on the HMD outside the room, (again as best I can tell) the user never saw the real bridge that was constructed, so the bran has no other cognitive interpretation of what is going on except for what they see. BTW, don’t misunderstand me, with exception to perhaps one person, they KNOW its a simulation and short of flinching and perhaps lowering one’s body, they are enjoying it for what it is.

Marketing

I would guess most people who watch this video, especially those in the VR world would mostly be thinking about how great of an immersive simulation this is, and move on. But what really caught my attention, and what I like and admire just as much about this concept, is how well this works from a marketing point of view. Remember, they are releasing a (new?) instant latte. The sell point for this product is you can enjoy a cafe quality latte anytime, simply by using a microwave.  Ok, so what are the customer scenario where they may want this?   Most likely at home and perhaps the office.  I think most offices offer coffee and if not, typically there is a cafe near most large office complexes.  But at home, not so much.

In the experience we saw in the video, you are asked to cross this long dangerous bridge on a distant exotic mountain top in a blizzard!  Many dangers face you on your trek to get to the other side where a microwave waits for you.  Each step on this old decrepit bridge becomes more dangerous as the winds increase, and rocks start to fall all round you!  Somehow, through perseverance and a bit of luck, you make it to the end where, you find a microwave, (yes people do randomly leave microwaves in the Himalayan Mountains, just go with it). You open the door and a wonderful hot beverage is waiting for you to warm you up, body and soul.

Now, think about a long snowy winter train ride come where you have to walk the last 3 or 4 blocks.  Not too different eh?  And if you like lattes then knowing you have a nice warm drink waiting for you could be that much better.  So the sell point here is to associate a tough trek with a warm reward.  This experience drives this idea to the customer is a very real and tangible experience. An experience they will not soon forget, and share with their friends, including the idea of the microwave latte and the branding that goes with it.

Execution

I have not experience this but having been doing VR for so long, and having tried everything from the CAVE to the wind bird simulation, its not hard for me to put myself there and have an idea of what this would feel like.  I love the fact that this experience really allows you to ‘walk’ through it.  Yes we have plenty of simulations where you can walk, but typically its flat ground.  But here you have a bridge, you have rope to grab.  As the wind starts to push you back, the IMU on the headset reflects the sublet changes in head position because of it.  As you walk, the scene walks.  With the xbox sensors and the very well lite room, body tracking can be very precise.  I’m sure a dedicated local wifi was running allow the fastest possible update time that can be done with current technology.  Based on the headset graphics it looks like Unity is running this, but again, because of all the various sensors being reinforced with the same cognitive interpretation; you are on a bridge, in a cold wind storm, with the proper sounds, the less than realistic graphics does not matter so much. For some people, its too much!

BTW< this could have been staged, not sure.

A small note here.  Notice no gloves on peoples hands.  They are asked to walk through this cold experience with no gloves.  What that means, and you can tell at the end when people come out, is that they are using the drink to warm themselves.  A GREAT bit a experience detail.  Even after the HMD is off your head, YOU ARE STILL COLD! The experience is still with you, and the reward of the hot latte continues to reinforce the benefits of buying this product.

Appropriateness

So here I want to reinforce something about VR and marketing.  Like I said, I have been around VR for a long time, 20 years plus.  I have seen MANY marking events that try to use a VR experience to create an association of “high tech” or “cutting edge” or “next generation” to a product, some successful, some not so much.  In all cases however the VR experience has little to no association with the value of the product. Further, once the VR experience was over, that was it.  I typically remember what I liked or was annoyed by in the experience, to date I cannot remember a single product from one of those marketing campaigns. This is different.  Even though I did not experience it myself, the whole idea of walking through a blizzard to be rewarded with a hot latte seems to stick.  As the more real the struggle to reward is, the more likely you will have a favorable memory of the reward. What is appropriate about using VR here is that VR has nothing to do with campaign.  It is simply the best tool to achieve the maximum positive reward association with the product. Not trying to be ‘new tech’ or ‘cutting edge’ or ‘cool’.  well ok, a bit cool.  But instead simple marking 101, create a positive association with your product, and VR in this case, was a great choice.

Now, check out the Video.

From Reddit of course: https://www.reddit.com/r/nonononoyes/comments/3qp2h7/tesla_autopilot/

All this talk about self driving cars causing accidents, very little about how they avoid them and save lives.  So here is the first video clip of a real world situation where a Tesla avoided an accident by stopping way faster than I could have.  Also note, its wet.  So if a human was driving, there would be a possibly that the human would swerve the car as well, potentially causing another accident. (click the thumbnail to start the gifv.)

ALSO, the car was smart enough not to follow the idiot driver and ‘teach them a lesson’.  Which does bring me to one concern.  How long will it be until someone decide to hack their car to do just that?  Say someone cuts you off; the car can use object recognition to track and follow the other car and then bump them off the road.

Right now, our autonomous cars do not have a voice, but I already know what to expect having grown up with Eddie Murphy comedy.

Eddie Murphy talking car. ( warning NSFW)!!!

So this year will be just as good with even cooler prizes. Samsung is giving away a GearVR HMD WITH THE PHONE!! That’s right, win this category and you are set.  Of course, your team will have to figure out who actually gets the device, but that’s your problem.

Unless you have been living under a rock (and given the property values in the Bay Area that just might not be a bad idea), VR is the new hotness and everyone is in the game: Google, Samsung, Facebook (yes, Facebook!) Sony, HTC, etc…  The HMDs are more powerful, cheaper and better than before.  Tools make it easy to create PC or mobile VR games and apps.  Content from 3D video to full worlds is starting to be created.  We are still in the beginning, so VC money is still flowing to start ups that can find their nitch, and this is the time to get a team and try a hack.

Plus, it’s just plain fun.  

Go here to check out the details and get signed up.  There are lots of categories so plenty of ways to win a hack.  And VC’s love hack winners. Oh, and the VR Hackathon is offering free demo space on Friday nighty for anyone in the community who wants to show off their stuff!

Freightliner Inspiration Truck Unveiled at Hoover Dam. First Licensed Autonomous Commercial Truck to Drive on U.S. Public Highway (PRNewsFoto/Daimler Trucks North America LLC)

A while back I wrote a post that we would see self driving trucks before we see self driving cars.  Well that truck is now officially hitting the road in Nevada, and assuming the pics are of the actual truck that is going to hit the road, its sci-fi-ish. The Inspiration truck features a system called Highway Pilot which basically lets the driver run hands free once on the highway. The other thing this system will do is let other trucks with the same system to draft each other.  Now its set to 25′ which only gives you a little bit of fuel savings, but once a number of miles and hours have been logged without any problems, then I’m sure they can make that closer and then you will see greater efficiency.

The key things to know about this system is the driver only gets hands free on the highway, and cannot leave his/her seat.  However, there is a tablet like device the driver can use to do other work that is normally done when the rig is not rolling.  I expect LOTS of emails and facebook posts once this system rolls out.  Also, the driver can take over anytime by simply grabbing the wheel or touching one of the pedals.  This is how must cruise controls work so same idea there.

Even though this does not sound like a big deal relative to seeing google cars driving all over Mountain View,  this is a MAJOR event because we can start to officially log miles and hours on a system that is in business use and not testing. So once this rig hits the road the clock starts.

image from autoblog

Now there are still concerns, as mentioned in the CNET post, there is going to be some loser who is going to try to cause an accident with the rig so they can sue.  Sigh. But again, this is something we simply have to get through and the sooner we start crossing these bridges the better.  Of course the truck will have cameras everywhere so anything someone tried will be recorded and shown to be there fault, but like I said, someone will try.

I’m excited.  The more rigs that get this system, the more miles and hours logged.  Soon cars will be allowed to have highway cruise as well which will be quality of life saver for anyone who has long commutes.  I used to drive from Mountain View to San Francisco and I WISH we had that when I doing that run.  Anyway, once we get highways on cars, then we can look to the next step, local self driving.

Car added for scale

So Friday Elon Musk finally gave us the full details on the home battery he has been hinting at for the last few months.  As expected, it’s basically a smart battery that you can mount on a wall that will smooth out your home or buildings power demand from the grid as well as extend the power delivery from solar if you have that installed. And all for the low low low price of $3000 for 7kw/hr at 1000 cycles. Sounds great right?  Well… not really.  When you do all the math, it does not work out that well… for now.

First some REALLY basic math as a thinking exercise

Musk said Tesla’s 7 kwh capacity battery would cost $3,000, while the 10 kwh capacity one would be $3,500, however that does not cover the DC-AC inverter and installation which can add another $2k.  So let’s do the easy math..  A 10 kwh system could supply 1,000 watts of current to your home for 10 hours.  ok, cool.  So if we want to be able to run this fully off the grid we are going to need more than one.

Image from http://rameznaam.com/

The U.S Energy Information Administration says that the average American home consumes about 11,000kWh per year, or about 30kWh per day. So if an average user wants to get completely off the grid, it would only take three 10kWh Powerwall units—at a total of $10,500.  That’s a lot of money to get off the grid.  If we say the average power bill is $100 a month, it will take 100+ months to ROI the units, and that is assuming you already have solar power.  If you do not, then let’s add $10k for panels, inverter and installation after rebates. (btw, costs vary GREATLY depending on location) So we need to add another 100 months.  That takes us to around 16 years to ROI the system.  ($20k/100/12)

Now that was some pretty simple math we did there and for those who really know the detail numbers, ease back on the hate mail. I went with hyper simple math just to make a point. Now, let’s look at two common use cases for the home. Remember this device is targeted for home owners; industry, and the edge of the network for those with unreliable power or very high prices are different cases.

Home use case

So we have two use cases for the Powerwall. First the home user that wants to save money by Load Shifting and second the Solar Panel owner who wants to save money and/or go off the grid.  Let’s take the most common case first.  A home owner that wants to save money.

Load Shifting

Load shifting is a pretty simple idea.  Buy power in the cheaper hours and store it.  During the day when power is more expensive, use the power you saved previously. This is called time-of-day (ToD) pricing plans, this can be a significant cost saver. Let’s do the math on that using actual ToD numbers from a US power company and assuming the battery is delivering power during the entire stretch of peak hours. (these numbers come from Tom Lombardo at enginerring.com.)

Rates: $0.203217/kWh (peak) and $0.04643/kWh (off-peak)

Peak times: 2:00PM – 7:00PM (5 hours)

Assume a constant 1.7 kW load over five hours, which completely drains the battery every day.*

8.7 kWh x $0.203217/kWh = $1.77/day (if the customer were buying electricity at peak rates)

8.7 kWh x $0.04643/kWh = $0.40/day   (customer buying electricity at off-peak rates instead)

Energy cost savings = $1.37/day or $500/year

If a person spent $3500 on the Powerwall and another $1500 on the inverter, it would take ten years (simple payback) for the unit to pay for itself.  Since it has a 10 year warranty (and so do most inverters), it’s a break even situation at best.  However, it may not work out exactly like that because remember after a number of cycles, even lithium-ion lose efficiently.  So, depending on just how far you drain the battery, it may take a little bit longer, perhaps 12 years. Now if you do not need to pull that much power during the day, then you may go with a less expensive 7Kw model and save $500, but that only changes the math for a year.  So how many home owners would drop 5k on something with a 12 year ROI if things works out?  Not many, but more than you think.  I’ll expand on that when I talk about ‘Buying against the math’.

PV (Solarpanels)

Image from http://rameznaam.com/

For the homeowners who already have PV’s, the math make no sense.  “What?” I can hear you say.  I thought this was FOR PV owners.  Well, yes, but not ALL PV owners. See the ROI for PV’s is about the same as the math we just did above, but instead of buying your power at the low rate and using it during the high rate hours, PV owners generate power during the peak hours and sell it to the power utility, then use power from the utility at the lower rate hours when the sun is down.  If designed correctly, you should have a net 0 on your power bill.  So if you are already NOT paying for power, why would you buy a Powerwall?   Ahh.. Well here is where it gets complicated, interesting and why the Powerwall will make sense in the near future, and in time, more and more home owners will buy one.

Changing the rules of the game

Lets take a little trip to Hawaii.  In Hawaii, everything costs more, including the electricity. Some home owners have been trying to buy solar to not only save money, but basically pay little to no money to the power utility.  Other home owners are paying $300 to $400 a month.  However, not everyone can get solar because the utility cannot handle so much power coming back into the system, and worse, the utility loses money when people go to solar.  Remember the utility still needs to maintain the system and they need to make improvements to the system to handle all this power coming from the PV owners. The demand for solar is so large, that some people have been waiting 3 years to get it. So what happens is those with PV pay little to nothing and everyone else has to make up the difference, so you can imagine there is a backlog of people trying to get PV.  This is becoming such a problem that Hawaii is thinking of ending the practice of buying power back at the peak rate and instead pay at 50% rate or go to a Feed-In Tariff system. This is true everywhere by the way, not just Hawaii. In fact California may fill up on the number of home buyback agreements in 2016. Paying the home owner 50% the going rate is great for the utility, but guess what happens to the home owner’s ROI.  It just doubled.

Now, remember when I said most people would not bother with a 12+ year ROI?  Well, as more PV system prices drop, more systems will get deployed and soon all utilities will have this problem, and they will all go to the same sort of solution.  Do not pay as much to buy peak power or simply have a line connection fee. If the power companies decide to not pay as much for your PV power, then it does not make sense to sell it.  Instead, you may as well hold on to it yourself and not pay for the offpeak power. Basically go partially or fully off the grid. That takes us back to the math we did in the beginning.  If you already have solar, and your utility bill is not zero’ing out anymore because the utility changed the rules, then change your math.  And now the Powerwall makes sense.  So now you see where Elon got his 5 to 10 years est.  Now that we are at the tipping point for the cost of solar, and now that we have the Powerwall that makes home storage affordable and smart, the utilities will see more PV systems deployed and lose more money. They will be forced to make a change, and soon.

One is not enough

You may be asking yourself, or me depending if you are one of those people who like to yell at the screen of your computer thinking the author can hear you, that 12 year ROI is really not that bad.  That is basically the same ROI for solar today.  Well there is some details I left out.

Remember in the beginning of our simple math what it would take to get ‘off the grid’?  We did not buy just ONE of these units.  We bought three. Taking us to $10.5k  There is another reason you want 3 of these bad boys and that is because the power output of one these units is just 2kW continuous, 3.3kW peak.  So good luck running your 1kW toaster, 1.5kW kettle and everything else in the house at the same time.  Nope.  Not gunna fly. And what if its summer and you need to fire your old 5kW AC?  You are going to need a near 10kW While looking these things up I found a really good chart on the average power consumption of home appliances.  I placed it at the end of this post. Check it out.  See just how much power you can be pulling all at once.

Buying against the math

So how many people would invest $5000 on a Powerwall that MIGHT pay for itself in 10 years?  At first, not that many, but more than you might think. Remember, this is a Tesla device, not some ugly box sitting on the ground somewhere.  This device is very well designed, can mount on a wall and thus not take up limited floor space in a garage and smart enabled such that knows when to buy power, how much to store and when to try to sell if it has too much. Remember when Elon first started selling the Tesla roaster?  People thought he was crazy.  Well here we have the same situation. The people who will buy the Powerwall will not be concerned about the ROI, but instead will buy the device because they know they are helping the environment, getting a well-designed and good looking device for the home and, eventually, will pay for itself.  It’s from Tesla so they know it is the cutting edge of technology both physical and cloud technology.  Remember the Nest?  Same thing.  A VERY well designed device that looks good in the home that makes the home more intelligent and efficient.  The Powerwall is not that much different.  There will be enough people buying it that it will do what Elon wants, create demand for more batteries from his gigafactory to drive the price of batteries even lower. Then guess what? As the price goes down, the math gets better.  So in 5-10 years, I can see home battery packs becoming the norm.

Who else will buy the Powerwall now?

Image from http://www.itproportal.com/

Many people will.  A number of utilities and big box corporations have already signed up for the Powerpack.  Amazon, Walmart and Target are already testing the Powerpack in stores across the US.  For larger corporations, where 12-16 year ROI are not a big issue and having reliable uninterrupted power is of value, I can see the Powerpacks gaining acceptance probably from the same customers who bought in to the bloom box.  Remember those?  They were released with what seemed the same hype as the Tesla announcement, but as solar and wind got cheaper, the ROI for chemical power generation make less sense.  But I digress.

There are a number of use cases where people will buy the Powerwall today.  People who live on the edge of the power grid and have experience power loss on occasion.  Those who’s utility prices are far higher then the average, hello again Hawaii, and those who just like the idea of living off the grid. However, a HUGH market may not be in the US.  In India where even the wealthy have to deal with power interruption, may buy these in large numbers. Found this great comment on reddit.

In countries like India, very few cities ever get 24×7 electricity. You can be a millionaire, but still you can not have 24×7 electricity unless you install some sort of an expensive backup system. Almost every middle class and richer family owns a battery or fossil fuel based backup unit for their house and from the smallest business to the largest industry, uninterrupted power supply is always a huge issue.

The existing battery based solutions have many of the issues that Elon Musk pointed out in his announcement. They use old-school batteries (no thermal management, nasty leaky chemicals and toxic fumes). They also need special storage areas and most don’t “just work”. At $3500 for a 10kWh storage, it is a little more expensive than some existing good quality devices, but it really isn’t that much more expensive! Reliability and easy of use are very important and if Tesla can make a reliable and high-quality product which is also scalable enough that even businesses can own, then it will be a huge deal in many parts of the world.

Also if you tie it to other sources like solar, then many remote locations that were never connected can also have some power! (Think of hospitals, internet access stations etc.).

So to sum up, I think there is already a market for a very well designed home battery back up system, and even though the numbers do not work right now, there will be enough demand to get the economies of scale wheel turning fast enough to bring prices down. That it will be more attractive to the average home owner, which in turn will increase demand which in turn will bring prices down even further. And all this does not take into account improvements in battery technology which could accelerate cost reduction and cycle life even further.

Elon did not invent anything really new here, but instead, created a beautiful product, that works well and has a mission.  Somewhat like his cars.  And we know he was proven right on that front.

Following table is from http://www.wholesalesolar.com/solar-information/how-to-save-energy/power-table

* The daily energy values listed here are for the most efficient units in their class and the information was obtained from Consumer Guide to Home and the General Electric website.

http://np.reddit.com/r/grilledcheese/comments/2or1p3/you_people_make_me_sick/

BTW, unless intended, do NOT use the Crush setting.  You will be cleaning the crusher blades soon after.

//www.youtube.com/watch?v=0BZhqbq3nWU

However, this is not a post about the helmet, its more about the validation of wearables and how certain product vertices get defined in this new age of crowdfunding.  The goal of the fund raising was to get $250,000.  Well just over 8 minuets after setting the site live at 6AM pst, they blew through the $250,000 mark and kept climbing.  If I was still riding I would have been one of those throwing my money at them as well.  This is something as a biker I have wanted for a long time.

However, I see this more than just validation that every biker out there wants a cyber helmet. I also ride bicycles, I drive a car, I jog, and one day… one day, will grab a plane and fly.  In all these cases having hands free HUD with full situational awareness would be great for safety and convenience.   ‘But wait!’; you might say.  “Didn’t you say you did not like Google Glass’?  That’s right, I do not … in public that is.  I also said that in specific use cases, it make sense.  Again, I want to repeat this is NOT Google Glass.  This is custom hardware/software targeted to the motorcycle rider.  This is key.  Just putting a HUD display is not good enough.  You have to understand what a rider would want and this is where Skully hits the mark and why they are about to clear $1M. I always felt the Glass was a product solution looking for a problem, and there is nothing wrong with that. Trying things is how you figure out what works and what does not.  However the Skully system took a particular, and I can attest, dedicated vertical and build to them. This is exactly what we saw with the Pebble kick-starter campaign.  After raising venture capital for the product under their former name inPulse, the company failed to attract traditional investors under their new brand name, so the company requested crowd funding in April 2012.  They raised over $10 million.  This product validation redefined and restarted the whole smart watch product category and validated the crowdfunding paradigm.  Two years later, many will argue, and I would be one of them, that the Pebble is one of the best smartwatches on the market based on price, functionality and design. This is because they build ONLY what is needed to provide value to the customer, although the recent Google ware watches comes close. It will be the same with the Skully helmet.  Its one thing to have a great prototype product, its something else to get that product to a consumer level, and manufacturer to that level on a massive scale.   And you know that after this market definition and validation, there are going to be tonnes of copycats snapping at their heals.  But that does not matter now… Skully is first to this newly defined market.

The next few years should be interesting……  I think I may start riding motorcycles again.