Why NVIDIA, General Motors, and Other Giants Are Teaming Up on Self-Driving Standards

British chip technology company Arm Holdings said that it has joined NVIDIA (NASDAQ: NVDA), General Motors (NYSE: GM), Toyota (NYSE: TM), and other tech and auto heavyweights to form a new group that will work to establish a common computing platform for self-driving vehicles.

The new group, called the Autonomous Vehicle Computing Consortium (AVCC), said that its goal is to accelerate the development of safe self-driving technology. It's an interesting move for the companies involved, one that has the potential to lock in competitive advantages for each as self-driving technology matures. 

Who's in the new AVCC?

The AVCC doesn't (yet?) include every big name in the self-driving field, but it does include quite a few established heavyweights.

  • Arm Holdings, owned since 2016 by Japanese telecom giant Softbank Group (OTC: SFTBF), supplies designs and technology to makers of semiconductors for a number of applications, including autos and smartphones.
  • Robert Bosch GmbH is a Tier 1 auto-industry supplier with a big presence in Europe. Its mobility services unit supplies a number of advanced driver-assist systems (ADAS) to many of the global automakers, as well as a growing list of emerging companies in the electric-vehicle and self-driving spaces.
  • Germany-based Continental AG (OTC: CTTAY) is another Tier 1 auto-industry supplier that is working to expand its presence in the market for self-driving-related technologies.
  • Denso is a Japanese Tier 1 auto-industry supplier. Earlier this year, it formed a joint venture with Toyota to work on new automotive-grade semiconductors for highly connected and autonomous vehicles.
  • General Motors' subsidiary, Cruise, is thought to be among the leaders in developing self-driving taxis.
  • Chip giant NVIDIA has already staked out a big presence in the race to supply processors for self-driving vehicles.
  • NXP Semiconductors (NASDAQ: NXPI) is the leading supplier of automotive semiconductors and an important supplier of components for ADAS systems, including automotive radar systems. NXP has a long-standing relationship with Arm.
  • Toyota's in-house research unit is taking a two-track approach, simultaneously working to develop full self-driving as well as a new generation of ADAS systems that will use related technology to assist human drivers.
The Drive AGX Pegasus, a circuit board with several rugged-looking processors.

NVIDIA's Drive AGX Pegasus is a complete on-board computer for developers of self-driving vehicles. Image source: NVIDIA.

What's the AVCC's goal?

In a statement, the group said that it plans to begin by developing a set of recommendations for "a system architecture and a computing platform to promote scalable deployment of automated and autonomous vehicles." The hope is that the recommendations will help move the industry from self-driving prototypes to deployment at scale, by outlining and standardizing systems that are up to the task.

The group won't be writing self-driving software, but it will provide some software-related standards. Among other things, the group expects to recommend standards for application programming interfaces (APIs), the protocols that the software "building blocks" in an autonomous system will use to communicate with one another.

A GM Cruise AV, a small electric hatchback with visible self-driving sensor hardware.

General Motors' Cruise subsidiary has advanced self-driving taxis in testing now. Image source: General Motors.

Is this a big deal for investors?

Yes and no. The AVCC is one of several collaborations between players in the space that are working to solve aspects of the technological challenge of self-driving, and self-driving is (rightly) an area of interest to many investors. Many of the AVCC's members are also involved in other collaborations, including the Networking for Autonomous Driving Alliance, which is focused on the challenge of moving large amounts of data between processors inside a vehicle.

But it could be a big deal for investors in this sense: The AVCC's recommendations will likely include products made by some or all of its members. Among other things, it could turn out to be a way for companies like NVIDIA and NXP to own a large share of the future market for self-driving-vehicle system components -- and, potentially, to shut out smaller or less-nimble rivals.

Long story short, the AVCC isn't going to transform the industry overnight. But for investors in any of the member companies, it has the potential to be a big deal in time.

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John Rosevear owns shares of General Motors. The Motley Fool owns shares of and recommends NVIDIA. The Motley Fool recommends NXP Semiconductors and Softbank Group. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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