Elon Musk Is Right To Be “Paranoid”: From Saboteurs To Shorters, This Is Life In The Entrepreneurial Fast Lane

Elon Musk Is Right To Be “Paranoid”: From Saboteurs To Shorters, This Is Life In The Entrepreneurial Fast Lane. (Opinion June 27, 2018)

by Mark J.

Recent news of Elon Musk describing a Tesla employee sabotaging his operations, suggesting competitor involvement and espionage, should not simply be discounted as paranoia.  Nor should his mercurial attitude towards financial journalists—some of whom paint a doomsday scenario by casting doubt over the company’s ability to meet M3 production—be seen as the dismissive ramblings of yet another billionaire who’s lost touch with reality.  Call me paranoid, but all in all, like a slow undercurrent, there already seems to be an invisible social-media crusade, a gathering of anonymous accounts that now smear the multi-focused CEO.  

Obsessions over his relationship with gothic, synth-pop musician (and Canadian) girlfriend Grimes are just as bizarre, and the oft-made comparison to fictional over-the-top comic book character Tony Stark only help caricature Mr. Musk, perhaps unflatteringly.  All of which still help Mr. Musk remain relevant, along with his Twitter encounters that are, in essence, indirect, low-cost marketing campaigns; whether the content is good, bad, or even offensive to some, it still garners attention with an all-too-dismissive public.  

More disconcerting to Musk is the onslaught of attacks to his business interests at Tesla, not simply by employees, but by the media.  Tesla’s predicament, if you can call it that, is in some ways reminiscent of BlackBerry’s in the years that followed the launch of the iPhone.  BlackBerry lost the smartphone wars for a number of reasons, but the sometimes undeserved negative press and commentary it received during its BB10 years would prove critical to its downfall. 

It was significantly damaging, slowly killing its image and its ability to compete with the well-funded, slick marketing campaigns of its competitors; the barrage of criticism forever tarnished the brand in the eyes of public perception. 

As a result of its micro kernel, any technical expert will tell you that BlackBerry’s BB10 operating system, running on QNX*, was the best OS for a mobile phone, particularly compared to its sluggish and security porous competitors of Android and iOS.  Ultimately, that didn’t matter, because a vast catalogue of apps mattered more to the average consumer, and developers refused to make them for the OS.  The QNX micro kernel is optimal for apps and makes its OS immune to crashing, is more energy efficient and secure, and had app developers provided for the QNX-based BB10 OS, the smartphone market would look radically different today. 

However, at that point, app developers were unwilling to provide for an OS that was drastically shrinking in market share—the tide for BlackBerry had irrevocably turned, and all the shorters danced with glee.  The media bias against BlackBerry was strong at this juncture, not only from U.S. sites, but from Canadian periodicals: the Globe and Mail published an elegiac piece in 2013 called “How BlackBerry Blew It : The Inside Story,” all the while the company still manufactured phones.  Stories of customers queuing outside Apple stores were commonly covered as an event, a kind of news as advertising for a brand that elicited of-the-moment vibrancy, and the mythology around Jobs had already deified the Apple CEO (buoyed by a best-selling biography, documentaries and Hollywood films including, “Jobs” 2013 and “Steve Jobs” 2015, et. al).  All of this factored in a spike in iPhone sales from Q1 2011 (37 mil. units sold) to Q1 2018 (77 mil. units sold)

It was a perfect storm for failure for any competitor, except for the open source strategy of Android and the resourceful, deep pockets of Google which coupled its software with Korean and Chinese based hardware manufacturers—BlackBerry stood little chance in this technological drag race, but the incessant media criticism it faced was its existential undertow. 

In 2007, the iPhone launch created a whispered nightmare of worries for its competitors that would later crescendo to a shrieking reality for the likes of Nokia, BlackBerry and Motorola.  However, most BlackBerry enthusiasts will agree, that during the company’s BB10 days, a tidal wave of castigations from the media were imbalanced if not biased, particularly when U.S. carriers aligned with iOS and Android devices.  With help from media and influential tech-news sites, BlackBerry’s attempts to resurrect itself with BB10 were snuffed, keeping intact Apple’s and Android’s competitive advantage; one suggestive derision here, one captious review there, all contributed to relegating the BlackBerry smartphone to the dustbin of history.  

Tesla knows the full scale of how malicious reviews can be, even in casual parlance, as it sued Top Gear for libel for an episode that appeared to be completely biased in its review of the Tesla roadster; these seeds of doubt can sprout a weedy wasteland for any company, and is fertilizer for competitors—best to snuff them out before they take deep root.  

Tesla is not BlackBerry, but shorters would love you to think that it is.

By no means is Tesla BlackBerry, and if a comparison were to be made, Elon Musk looks more the part of a Jobs than a Lazaridis.  However, the recent slamming by the press of Tesla echoes this kind of persistent negative layering and does more to smear than to inform. The Tesla brand is facing similar attacks from the media regarding the spontaneous combusting of Tesla vehicles and those from its competitors who are looking to keep Tesla at bay; a Tesla vehicle igniting into flames is a rarer and a less-likely event than that of a vehicle with a combustion engine, yet it makes headline news over its gas-powered counterpart. 

Any attempts at smearing as a way to deter consumers is futile, while damage-proof batteries are also just around the corner, setbacks, including those occurring with autonomous driving are temporary, and will not stop those who hold conviction for what Tesla holds on offer.  When you realize it’s less about the content of the news and more about its symbolic impact, it’s difficult to not see a lot of this news as utter nonsense.    

To what extent will billion dollar companies go to in order to maintain their positions of power?  To mirror Elon Musk’s thoughts, a diesel emissions cover-up is but one example, and it isn’t the first time that the oil and gas industry have gone out of their way to prevent alternative energy from succeeding.  Think back to when GM’s EV-1 was carving up the PCH (Tom Hanks’ likeable testimonial here) before they were ordered to be systematically repossessed from their lessees and crushed out of existence.  In a lot of ways, Elon’s Tesla takes away from where GM failed with its cancellation of the EV-1 program, in similar fashion to how Apple redesigned the cellphone.  Elon Musk has admitted that founding Tesla was in part a reaction to the cancellation of GM’s EV-1; GM’s failure to adapt or to keep the EV-1 program running was a tarnish to their electric ambitions, even with its resurgence in the Chevy Volt.  Rick Wagoner, CEO of GM at the time, admitted to the rueful decision as one that he’d like to have back.  The order to have the vehicles crushed was a stain on the company’s EV brand, however, GM’s recent launch of the Chevy Bolt is an immediate competitor in the EV space.

Tesla CEO Elon Musk…

 
copyright : AlgoPress/Algorithmic Culture

…is right to be paranoid, it’s part of the job description.  When Mr. Musk writes in an email to Tesla employees addressing that the possible culprits regarding alleged espionage and saboteurs are his competitors—possibly oil and gas companies, and/or auto-manufacturers who deem electric vehicles as a threat to their bottomline—it should come as no surprise.  In particular, EVs will save the consumer on repairs in the longterm; less parts translates to fewer problems for the consumer.  The loss to oil and gas companies is obvious.  Beyond the reach and damage of saboteurs is the damage inflicted by media, the kind that can stain a brand and seemingly annihilate them from existence.  It’s just as important to be a part of some technological zeitgeist than it is to merely produce a shiny product, to which Tesla, Musk in particular, are included.  

“As you know, there are a long list of organizations that want Tesla to die.  These include Wall Street short-sellers, who have already lost billions of dollars and stand to lose a lot more.  Then there are the oil & gas companies, the wealthiest industry in the world—they don’t love the idea of Tesla advancing the progress of solar power & electric cars.  Don’t want to blow your mind, but rumor has it that those companies are sometimes not super nice.  Then there are the multitude of big gas/diesel car company competitors.  If they’re willing to cheat so much about emissions, maybe they’re willing to cheat in other ways?” –Elon Musk (excerpt from email to Tesla employees)

Tesla will not face irrelevancy with its headlong pursuit of high-end and low-end zero emission vehicles any time soon, but it should be careful as auto manufacturers pivot towards electric vehicles, including Volvo whose entire fleet will go electric/hybrid by 2019. It will be interesting to see how Tesla will differentiate itself in ten years when all the major auto manufacturers offer electric vehicles at competing prices.  All things being equal, what will convince a consumer to buy Tesla over an all-electric Mercedes at the same price? Porsche Taycan anyone?  Will the company drown in a deluge of competition? Will the brand still be relevant or will the M3 be a failure, positioning Tesla to become a low-output boutique automaker? 

With time, it’s possible that Tesla will no longer be vulnerable to journalistic queries but very much susceptible to the workings of the free market; at which point, they might have to give up the car manufacturing business altogether and restructure to something else, i.e. defaulting to being an energy/lithium battery maker.  

Is the M3 Tesla’s “iPhone moment”?  It’s hard to make that comparison when the aforementioned Chevy Bolt is already a legitimate competitor with hard sales in the EV space—lacking slightly in electric range and horsepower—the Bolt produces competitive offerings to satiate the average eco-conscious driver.  However, one thing seems certain and it’s that Elon Musk has already had his iPhone moment, several of them, and more are on their way.  At at time when NASA, no longer able to innovate or execute projects, whether for reasons too bureaucratic, lack of funding, or simply conforming to stagnation post-Challenger years, now genuflects to a lone entrepreneur who assembled a team that built a reusable rocket.  As a venture, Space-X too faced near collapse with a series of failed launches, but now supplies Falcon 9s to NASA.  Simply amazing.      

However, like its CEO, the Tesla brand is strong because of the culture surrounding Tesla—talk to a Tesla owner and you’ll understand.  Those waiting for Tesla’s delayed M3 are no different than those who lined up for an iPhone; they’re similarly enamoured by that palpable, of-the-moment aura that now surrounds Tesla and its CEO.  

copyright : AlgoPress/Algorithmic Culture

The company, along with its forward-looking visionary, feeds a culture of those who want and understand the electric vehicle as a sign of technological and humanitarian progress: zero emissions; minimalist elegance in design; a virtually silent and conscientious riding experience; long-term reliability, among other attributes that ultimately urges on a smog-free world.  They want to be a part of this moment, by owning a piece of it, many of whom will gladly accept the delay before they’re gifted with a piece of history.  With the same fervour that drove people to protest the culling of the EV-1, these consumers are demanding to see Tesla (and companies like it) succeed.  

The “iPhone moment” has as much to do with something ineffable than a company’s ability to simply meet demand on time.  Media vituperations, market forces, or attempts to taint the company will fail; bet on Tesla because most do not want to see it fail.  It’s only because of Elon Musk that we’re even discussing EVs dominating the world’s roads in the foreseeable future, perhaps decades sooner than expected as an alternative to gas-powered vehicles.  With Tesla, Mr. Musk has ushered in our fantasies toward a reality, and consumers want in on the ride.

*Because of its secure micro kernel, QNX has been issued to operate nuclear power plants, as well, it’s the core software for many automobiles today and likely in the future as automobiles become more software powered and autonomous.  See BlackBerry/QNX Autonmous Vehicle Innovation Centre.

**The Chevy Volt, despite rumours to the contrary, is to be discontinued by 2020.  However, new competitive EVs from GM/Chevrolet are scheduled to enter the EV market.