Remember how at TechCrunch’s Disrupt 2010 event Eric Schmidt (Google CEO) said that “it’s a bug that cars were invented before computers. Your car should drive itself. It just makes sense.”

Well, he wasn’t kidding. Google just revealed today that it has been working on a self-driven-car project. Apparently, the car uses video cameras, radars and laser range finders to map out the terrain around it and also to, I quote, ‘”see” other traffic’. Google also said that by using their own databases, it was possible to process enormous amounts of data involved in mapping the terrain.

A Toyota Prius was spotted by Ben Tseilin over a year ago. Back then, nobody quite knew what the weird car was about. The closest one could get was that it was a Mapping car (the car which Google uses to map out the terrain to be used in Google Maps). Once again in the January of 2010, Robert Scoble shot a HD video of the Prius. This time, it was thought to be a Street View car. Here’s the video:

Google is extremely good at keeping things a secret; because according to their blog post, they had even informed the local police of their work!

Here’s a snapshot of the technology behind the car:

The technology behind Google's self-driven car

[Image via NYT]

The cars (apparently, there are many customized Priuses and Audi TTs) in one way are, and in another way, aren’t completely self-driven. Two trained personnel are present inside the cars at all times – a driver who takes over in case anything falls out-of-place, and an engineer who monitors the software running the car. According to Google, the cars have driven from their Mountain View campus to their Santa Monica office and then continued onto Hollywood Boulevard. From a bigger perspective, the cars have logged a record 140,000 miles.

The World Health Organization stated that 1.2 million lives are lost every year in road traffic accidents, and Google aims to cut down that number by half. Although I don’t quite understand how Google plans to make a business out of this, I’m pretty sure they’ll figure out how to monopolize this sector; even if it means advertising in the car, I guess. As of yet Google doesn’t have any plans, “The Google researchers said the company did not yet have a clear plan to create a business from the experiments.”