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TheStreet Open House

Apple's CarPlay Will Have a Huge Long-Term Payoff

NEW YORK (TheStreet) -- At first, it might appear that Apple's (AAPL) move into the auto industry is a modest adventure. After all, there are only 15 million new cars sold all over the world each year, and CarPlay will be on only a portion of those. In addition, it's easy to get distracted by concerns about Siri's robustness combined with concerns about driver focus and safety.

History has shown that the early diagnosis of a new technology is almost always off the mark in the long run. That's because observers tend to cast a new technology in the perspective of old thinking. Because innovation is a new way of seeing things -- in essence discovery -- the famous quote from Albert Szent-Gyorgyi applies:

Discovery consists of seeing what everybody has seen and thinking what nobody else has thought.

When Microsoft's (MSFT) Steve Ballmer was asked early on about the prospects of Apple's new iPhone, his initial off-the-cuff criticism was that it didn't have a physical keyboard, wouldn't be good for email and therefore would not be popular with business people. Years later, with better perspective, Ballmer admitted that Microsoft didn't get on the mobility bandwagon soon enough by mimicking Apple.

I cite this example because it's memorable and a good way to illustrate that it's hard even for an experienced CEO to correctly assess a competitor's new technology.

Harder still is the challenge to put the long-term strategic consequences into perspective. For example, it's all too easy to think in a simplistic way about device handling in the car. At first we had an iPhone in our hands or stuck on the dash. With CarPlay, there is better integration, but not in an earthshaking manner. So CarPlay may seem like a yawner. It's not the startling new innovation, virtual magic, that some have been clamoring for.

It's been noted elsewhere, however, that innovation isn't always a surprising new technology. Sometimes, innovation is the incremental extension of current technology in news ways. Moreover, placing Apple technologies like Siri and Maps in front of average users is going to provide mission-critical feedback that will drive the technologies to the next level of refinement.

Technology is never frozen in time.

The working environment of the car, its speed, hazards from other cars and objects, and the sophistication of the environment is at least an order of magnitude greater than sitting in an armchair with an iPad. While that's alarming at first, it's also a challenge which, if met correctly, will advance the general iOS state of the art.

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