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Tesla seems more focused on designing high performance "halo" cars than it does making existing features competitive with those of other manufacturers. Instead of focusing their software engineers on making the current systems best in class, they have split their focus on new drive train options and this autopilot thing that will probably never fully live up to what is being promised. How long does someone have to wait for the navigation system to offer the basic features of any off-the-shelf navigation, or even the basic features of my 7 year old Prius DVD-based navigation?
Tesla can't design and sell a front console without being 2 years behind schedule, same with the CHAdeMO. They are focusing too much energy on what's next and not enough on improving what already is. It's an embarrassing picture if you look at things objectively and separate from your love of Tesla. I think my honeymoon phase may be ending because I'm very concerned with the decisions that Tesla is making. I used to think Musk could do no wrong, but lately he seems to be on the defense judging by his Q4 conference call performance.
steve841
Active Member
I think this is quite typical of a company in its growth phase. Important not to loose focus however. He is running this like a start up, all these innovations he thinks are going to keep the investors happy as orders increase.
I admit the features make the car more appealing for prospective owners but for current owners perhaps certain frustrations aren't being met. Hopefully a balance will be found.
I admit the features make the car more appealing for prospective owners but for current owners perhaps certain frustrations aren't being met. Hopefully a balance will be found.
Hmmm... How can a revenue deferral be taken care of by a software release at all?
Bet TSLA
Active Member
You can't recognize revenue from a product you haven't delivered. For a product you have only partially delivered, you cannot recognize all the revenue. In this case, I think we're dealing with auto-pilot features not yet available to drivers. When a software update makes them available, Tesla will then be able to recognize whatever revenue on those cars that they have deferred.
This is one of the reasons that Tesla does not usually promise specific features in future software updates -- they don't want their accountants telling them that they can't recognize revenue. So long as they are vague, there's no way to support the claims that customers bought the product expecting more than they got.
makes sense. Another dimension of pioneering. How to apportion value of future features enabled by software. But I don't think Apple deferred a penny of NFC on iPhone 6 even though initially there was no software to enable use. First shoot the lawyers, then the accountants
Bet TSLA
Active Member
No reason to. The feature was there and worked from day one. To make best use of it there are other things that have to happen, but that has nothing to do with the product itself.
Apple previously deferred a chunk of iPhone revenue due to their accountants telling them they couldn't really view any iPhone as completely delivered until it had gotten two years worth of promised software updates (no specific features, just bug fixes). From this article: "Instead, Apple incrementally recognized a fraction of that deferred revenue each quarter over a two year period. The practice was designed to ensure that revenue wasn't counted ahead of delivering a full product, because in Apple's accounting, the iPhone wasn't finished until two years of software updates had been provided to the end user." I thought it was ridiculously conservative accounting, but it did have the nice feature of guarding against a revenue drop due to declining sales. Of course that has not yet happened in iPhone history.
mikeash
Active Member
Actually, Apple Pay required a software update to the iPhones as well. They initially shipped with iOS 8.0, and it wasn't enabled until iOS 8.1 shipped in October. A minor delay and this may not influence your point at all, but I thought I'd nitpick anyway.
Bet TSLA
Active Member
The feature was NFC, not Apple Pay. That worked all along.
To bring this back to Tesla, I don't believe they needed to defer revenue (given what I believe they will be delivering), but they chose to in order to be conservative. They delivered all the hardware needed for the auto-pilot features, and it was actively being used from (almost) the start for speed limit assist and lane departure warning. It's a judgment call based on what customers believe they are getting, not necessarily what the company has said it is delivering. So conservative is probably good.
The feature is Apple Pay, NFC is the hardware needed for the feature. The NFC hardware did nothing in the iPhone until it was used by ApplePay which was enabled iOS 8.1.
Very similar to what Tesla has done with the sensors.
Bet TSLA
Active Member
As you like. It doesn't much matter what we consider to be a feature. What matters for deferred revenue is what the accountants think. I believe the crux of the matter to them is whether customers purchased your product in order to get something that isn't actually delivered until later. If later is within the same quarter then it doesn't really matter, but if it isn't then recognition of some appropriate amount of revenue must be deferred.
Bet TSLA
Active Member
I wish people would stop repeating this BS. Elon's words were "positively affect". Yes, you're being funny, but it's funnier if you can come up with something that matches what Elon said rather than the OP's misquote. Bricking the fleet would probably not be seen as a positive.
Bet TSLA
Active Member
My apologies. I assumed that changing it was in your power, and that if you couldn't do it directly that at least you could send a request to the moderator. Sorry.
I will admit that I have not re-listened to the portion in question (I quoted "significantly" by what I thought I had heard the first time). Anyway, apparently the proper verbiage was "positively" instead of "significantly" and so that word change is what I would like. Unfortunately my original word choice has somehow found itself rather twisted.
Thanks!
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