Standardization is a zero-sum game. There are clear winners. And modern history is littered with the carcasses of losers. Betamax was priced out by VHS, which came to dominate the home video VCR market for the next two decades. Microsoft’s bundling of Internet Explorer with its Windows operating systems put paid to Netscape Navigator’s growth plans. And with the likes of Facebook and Twitter amassing users, Google+ was destined for failure.
What are the upcoming standards?
Even though he doesn’t admit it openly, Maini is prescient about an upcoming standards shake-out. That’s why SUN isn’t competing to be the next VHS or Microsoft. They’ve set their sights on a much closer example in history: Android.
“Think of us as the Android platform for electric mobility. It’s an open standard, with little, individualized tweaks for different form-factors. Just like Android has the capacity to tweak its apps for a Xiaomi or Samsung phone. But the basic application remains the same,” explains Maini.
The comparison with Android makes SUN’s ambition—to be the new normal in charging standards—crystal clear. Maini admits, however, that the SUN solution isn’t exactly like Android’s open standards. The involvement of OEMs—to make the battery compatible—is needed from the start.
This complicates things.
Breadth of operations
At the end of the day, says ION’s Aryan, standardization isn’t about the technology or breadth of operations. It’s about exerting power and influence. Aryan launched ION Energy with a similar battery-as-a-service model in mind, but its ambitions were cut short by low-cost batteries from Chinese competitors. ION’s model has since pivoted to its current BMS focus.
For the Android-like scale, SUN needs to have an Android-like influence.
“The only places where swapping has really worked at scale is where an OEM or a fleet owner themselves have popularised a battery standard.
They have the scale and influence to do it,” says Aryan, citing Taiwan-based Gogoro’s model. Gogoro, which manufactures its own electric smart scooters, has built out an extensive swapping network across Taipei to service its two-wheeler fleet and flood the market with its standardized energy offering–GoStation.
Closer home, it’s what Ola might try with its new electric fleet and charging infrastructure, and through its investment in ride-share companies like Vogo.
Role of the Third-Party energy
“It’s going to be really difficult for a third-party energy provider to wield that kind of influence on an OEM partner or a large fleet owner, to get them to adopt their standard,” says Aryan, echoing SmartE’s Srivastava.
To his credit, Maini has put his considerable influence to good use. SUN’s been proactive in signing up OEMs and fleet owners, seven of whom he’s not willing to name before negotiations conclude. “We already have names like Ashok Leyland on board,” he says, confident that he will be able to capture the first-mover advantage with his roster of influential partners.
SUN’s early play at a walled garden approach might work to some extent. But to create, establish and scale one standard, a battery platform like SUN will need a significant shift in goalposts. The parallel then is not Android, but Jio.
“If you’re willing to put in the resources that Jio did for the telecom sector, then you might gather enough influence to unite OEMs and others to your standard,” says Aryan. But a Jio-like scorched earth strategy—which would mean offering swapping/charging literally for free— means billions of dollars in cash burn to keep customers on one platform.
What are the dominance ratings?
Even that dominance might be fleeting in the fickle mobility sector, with the constant flux in battery sizes, power, and chemistries. The hero might have signed onto the SUN platform for now, but as Gill reveals, there’s nothing stopping it from signing on other providers.
“Maybe we’ll sign up different partners for different geographical zones,” he says. Hero’s approach might be to spread its risk, but it’s also a prime example of why the market may stay fragmented for longer.
And while fleet-owners like Srivastava want this fragmentation to end, he too, can’t see an individual company tying it all together. “The government must get involved with the OEMs to create this battery standard,” opines Srivastava.