The Development of the Commercial Drone Industry

Humanity has a unique combination of intelligence, ingenuity and idiocy, that makes its every action an adventure. The UAS industry is such an adventure.

At the time of publication of “The Future of Commercial and Industrial UAVs – 2016 Edition”, aviation authorities around the world are trying to impose order on the chaotic world of UAS use by issuing regulations. In most countries, these have sensible components and less sensible aspects. Frequently night flying is forbidden, unless granted special permission from required authorities and almost always line-of-sight operation is required although the future of the industry most definitely will need to overcome this limitation. They treat UAS almost as mini-planes which, in some ways, they are but they are so much more. They have equipment, function and operation just as any aircraft but they also obtain information, data which has the potential to create civil lawsuits fit to break any bank.

Regardless of the ability of the UAV or its application, any aircraft aloft should carry insurance. If there is a potential for damage to itself, to any third party on land, sea or in the air then there must be liability insurance. Any insurer worth its salt will require six things from a UAS operator

1. A certificate of suitability (airworthiness certificate from a public corporation such as the CAA (Civil Aviation Authority) or a classification certificate from an independent association such as the LAA (Light Aircraft Association) or even Bureau VERITAS or Lloyds should they wish to take up the challenge or even a compliance certificate from a Code Authority such as UL (Underwriters Laboratories) or BS (British Standards)
2. A description of the work it intends to do (a sort of flight plan with the operation it plans to undertake such as spraying pesticide or planting trees and the area of operation)
3. Some indication of the operator’s competence (a licence or qualification)
4. Evidence of a risk assessment
5. Individual UAV identification (possibly an individual IP address)
6. How any data obtained will be used and stored?

These requirements will not hinder the development of the UAS industry but will temper enthusiasm with a small dose of caution. Items 1, 3 and 5 are one-off activities and items 4 and 6 might well be generic so only item 2 needs to be individually filed and that should be part of the quote or job description.

This is quite reminiscent of the birth of some other service industries such as the air-conditioning and refrigeration industry which, in the early parts of the 20th century, produced many technological leaps and fathered numerous small companies hoping to make their mark.  Because the transfer of knowledge and techniques was much slower then, it took almost 40 years for the industry to mature and become what it is today – several big players who have cornered the standard requirements and several small and medium sized companies providing bespoke and specialised solutions for niche markets.

In fact, this is a standard model of the growth and development of a service industry.  This is the way we might expect to see the UAV industry develop.  Because of the Internet and the mobility of skilled labour, the progress will be much faster. We are still in the ‘Product’ stage of the industry wherein a multitude of new products vie for customer acceptance. At the moment, each nation is producing a group of sharp, technology savvy, young(ish) entrepreneurs focussed either on the product they want to sell and trying to find a use for it or they are concentrating on the end use and selecting a UAV to satisfy this use.

This is normally followed by the ‘Processes’ stage when economies of scale are brought to bear and customers are attracted by price and companies compete on efficiency.  Except for military specification UAVs, the price of the UAS is generally quite modest when compared with the cost savings.  This comes at a cost of less reliability and, as yet, shorter duration of flight.  The next few years will see reliability and duration increase while prices remain competitive. Larger corporations will gradually buy up the smaller companies and bring standardisation and focused service strategies to satisfy each requirement. Current and proposed international competition rules will work towards a more global market.