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Commercial Drones in 2017: What’s Now and What’s Next

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commercial drone

On March 10, 2016, a startup beat Amazon to deliver the first parcel to a residence via drone. Nevada-based Flirtey delivered a package of bottled water, emergency food, and a first aid-kit to a residence in Hawthorne, Nevada in the first fully autonomous urban flight.

Don’t sleep on Amazon though. It debuted its comprehensive unmanned aerial vehicle (UAV) shipping service with its first drone delivery December 7th.

commercial drone

Today, retail drones make up a tiny portion of high-end consumer electronics, but UAVGlobal now lists 449 UAV manufacturers, representing myriad applications and pushing for a larger share of the luxury market.

Commercial drones are heating up in 2017. Here are some things you can expect.

2020 seems to be the magic year for drones.

Widespread drone delivery will become “plausible” in 2020, according to Gartner researcher Ivar Berntz. By then, he predicts we’ll see at least three “Uber for drones.” These drone-sharing platforms will broker arrangements between drones (and autonomous boats and vehicles) and companies to move goods.

commercial drone

Goldman Sachs recently sponsored interactive content on the Washington Post highlighting the bank’s research on drone technology.

It predicts that business and civil government demand for drones will grow fastest between now and 2020 and that by 2020, government and commercial demand will propel the drone market to $100 billion. A report published by PricewaterhouseCoopers put the global market for commercial drone applications, including package delivery, at up to $127 billion by 2020.

National defense will make up 70% of that market and will be the largest consumer of drone technology for the foreseeable future. Hobbyists were the first market for drones outside of the military. They will make up nearly a fifth of the future demand for drones according to Goldman Sachs Research.

Research from the Mercatus Center, on the other hand, predicts that hobbyist drones will make up more like 60% of the market in 2020.

commercial drone

Drone jobs

An Association for Unmanned Vehicle Systems International report predicts that widespread drone use will create more than 70,000 jobs within the first three years and that the economic impact for the U.S. will be $13.6 billion.

Here’s the Goldman Sachs breakdown of which industries will see what kind of boost from drones:

commercial drone

Potential uses for commercial drones

Deliveries

Autonomous delivery is the most obvious application for commercial drone use. Walmart has requested permission from the FAA to test drone deliveries. Two years ago Amazon began talking about delivering packages via Prime Air. Google Wing Executives promised a drone delivery service by 2017.

“Autonomous distribution (AD) isn’t currently available, but the opportunities are so close that CIOs at every company dependent on a logistics network must consider its impacts and opportunities,” Berntz wrote in a November 2016 Gartner report.

Agriculture could benefit from drones monitoring crops during the summer. A drone can inspect 1,000 acres of farmland per day. And UAV land surveys are more accurate than ones done by planes or satellites, and take less time to complete.

Civil government uses

“When combined with AI, drones have the power to save lives in a ton of industries,” Andre Salazar, a Senior Analyst at Ultramar Travel Management wrote on Facebook. “Most notably miners, electrical workers, police officers, and firemen. Pretty much any time someone has to survey a dangerous area before they go in.”

A drone can do the monthly pipeline inspection oil and gas companies are required to complete for much less than the $2,500-an-hour helicopter crew they’re currently using.

“The commercial usage of drones is poised to change both the timeliness and the detail of reality capture projects and the hybridized environments in which civil engineers will work and collaborate in the future,” Software and Technology Evangelist at HW Lochner Terry Walters wrote on Facebook. “This has enormous potential in both the traditional design spaces as well virtual reality environments.”

Walters works with Departments of Transportation to modernize technology and processes. “The Utah Department of Transportation is [shockingly] technology forward thinking,” he wrote. Walters is working with the Utah DOT to use their drone to capture daily (and in some cases hourly) photos of installation of an infrastructure project as it happens next year. “At the end of the project we will have a time series database where we can see the project as it was at any point and extract new features out from the data.” These mobile-friendly, 3D mesh surfaces, accurate to a millimeter, could replace paper or PDF plans for civil infrastructure projects like roads and bridges.

In Britain, drones are already conducting search-and-rescue operations and responding to emergencies. Pathfinder programs are testing drones to make deliveries and take pictures. In addition, drones are inspecting power lines, rail lines and other infrastructure. Next year we’ll see a professional drone racing competition at London’s Alexandra Palace.

And as for Flirtey, the groundbreaker in the US for drone deliveries? The company announced a partnership with Domino’s pizza in August. But you can only get a pizza delivered to you by drone if you’re within a mile radius of the Domino’s location in Whangaparaoa, New Zealand.

How to prepare

commercial drone

Soon customers will expect near-immediate delivery. Widespread autonomous delivery will force consumer goods companies to changes their physical and organizational structures. CIOs in these companies will better utilize their assets, reducing their empty runs and the amount they spend on freight. Berntz advises companies to start preparing now to redraw sales territories and rethink their logistics hub placements and routes.

Conclusion

While 2020 will be the big year for drones, 2017 will see more testing and more advances in drone technology. What are you excited about for drones in 2017? Let me know in the comments.

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About the Author

Cathy Reisenwitz

Cathy Reisenwitz helps B2B software companies with their sales and marketing at Capterra. Her writing has appeared in The Week, Forbes, the Chicago Tribune, The Daily Beast, VICE Motherboard, Reason magazine, Talking Points Memo and other publications. She has been quoted by the New York Times Magazine and has been a columnist at Bitcoin Magazine. Her media appearances include Fox News and Al Jazeera America. If you're a B2B software company looking for more exposure, email Cathy at cathy@capterra.com . To read more of her thoughts, follow her on Twitter.

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