The legal dispute between Uber and Alphabet's Waymo over stolen self-driving technology is finally over, as the two companies have reached a $245 million settlement.
The settlement has set the tone for Uber's future, as the ride-hailing company moves forward under the leadership of CEO Dara Khosrowshahi.
Uber Reaches $245M Settlement With Waymo
Uber reached a settlement with Waymo in their highly publicized legal dispute over allegations that Uber stole from Waymo trade secrets involving autonomous vehicle technology.
The settlement, which was revealed by Federal District Judge William Alsup on Feb. 9 after a week of proceedings, requires Uber to pay Waymo an amount of $245 million in cash, which is equivalent to a 0.34 percent equity stake in the $72 billion valuation of the ride-hailing company.
In addition to the monetary amount, Uber promised that it will not use Waymo's technology in the development of its own self-driving vehicles.
Waymo, the self-driving car unit of Alphabet, accused Uber of poaching Anthony Levandowski, the engineer who led Google's self-driving car project since 2011. Waymo claimed that Levandowski downloaded more than 14,000 files before he left the company to launch his own startup company, which was purchased less than a year later by Uber.
Is The $245M Settlement Too Steep?
The $245 million settlement is certainly a significant amount of money, but apparently, it is much lower than what Waymo was previously seeking.
In October 2017, it was reported that Waymo offered Uber a chance to put an end to their legal dispute in exchange for a $1 billion payment and a public apology. Uber rejected the terms, leading the two companies to trial proceedings.
Reports are now claiming that Waymo proposed a settlement deal with Uber earlier this week for $500 million, with much harsher conditions compared to the $245 million settlement, citing two sources familiar with the discussions. Uber also reportedly approached Waymo last week, also with a $500 million offer but with no promises regarding the usage of Waymo's technology.
What Does The Future Hold For Uber?
The settlement sets the tone for the future of Uber, which is under new leadership with CEO Dara Khosrowshahi at the helm.
In an official statement, Khosrowshahi maintains Uber's belief that the company never acquired nor used Waymo's trade secrets, but it will be forced to modify the LIDAR technology that it is using in its current self-driving vehicle prototypes. However, the company will not be leaving the business, a source said.
Khosrowshahi acknowledged Alphabet as a partner and an important investor, but also as a competitor. "And while we won't agree on everything going forward, we agree that Uber's acquisition of Otto could and should have been handled differently," the Uber CEO said.
"While I cannot erase the past, I can commit, on behalf of every Uber employee, that we will learn from it, and it will inform our actions going forward," Khosrowshahi also said, revealing a company with a personality that is a far cry from when previous CEO Travis Kalanick was steering the ship.