Commercial Drones – SAGE Business Researcher

Can pilotless planes soar over safety, privacy and regulatory barriers?

Executive Summary

Drone aircraft, until recently the domain of the military and a handful of hobbyists, play an increasing role in businesses, including agriculture, engineering and real estate. Still more untested uses are under consideration, such as using drones to deliver packages to customers. Millions of consumers also are buying the machines and taking to the skies. This rapid growth in drone use has increased concerns about safety and privacy. Change has come so quickly, regulators have been unable to keep pace. In the United States, the Federal Aviation Administration has yet to release commercial use regulations, instead allowing operations through what those in the industry say is a cumbersome case-by-case exemption process. Among the issues under debate: Can regulators and the industry resolve questions of safety and privacy? Is the United States falling behind in drone innovation? Can drones be used on a large scale for deliveries?

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Resources

Bibliography

Books

Hogan, Steven, “The Drone Revolution: How Robotic Aviation Will Change the World,” CreateSpace, 2015. A lawyer who specializes in drones discusses how the technology will change multiple industries.

Rupprecht, Jonathan, “Drones: Their Many Civilian Uses and the U.S. Laws Surrounding Them,” CreateSpace, 2015. A lawyer who is also a commercial pilot examines the complex regulations surrounding drones in the United States.

Whittle, Richard, “Predator: The Secret Origins of the Drone Revolution,” Picador, 2015. A global fellow at the Woodrow Wilson Center who has studied the military for three decades looks at the history of the world’s most advanced military drone.

Articles

Goglia, John, “FAA speeds up small drone exemptions. But why not just issue blanket exemption?” Forbes.com blog, April 12, 2015, http://tinyurl.com/kh9ozpt. An aviation safety consultant and professor of aeronautics questions the Federal Aviation Administration (FAA) regulations on small drones.

Gross, Doug, “Amazon’s drone delivery: How would it work?” CNN, Dec. 2, 2013, http://tinyurl.com/onntmxc. Amazon floats a plan to use a fleet of drones to deliver small packages to customers in under than 30 minutes.

Hill, Kashmir, “Congress Welcomes The Drones,” Forbes, Feb. 7, 2012, http://tinyurl.com/6vedoc8. Congress passes the FAA Reauthorization Act, paving the way for drones to be integrated into U.S. airspace by 2015.

Hoye, Matthew, and Rene Marsh, “Who’s in charge of regulating commercial drones?” CNN, March 19, 2015, http://tinyurl.com/phatjzf. Regulators are concerned that no single federal agency is in command of developing a strategy to regulate and enforce laws on drones.

Marsh, Rene, “FAA tests technology to counter rogue drones,” CNN, Oct. 7, 2015, http://tinyurl.com/qc8787y. The FAA is testing technology that would target drones flying within five miles of airports and force them to land.

Nicas, Jack, “Criminals, Terrorists Find Uses for Drones, Raising Concerns,” The Wall Street Journal, Jan. 28, 2015, http://tinyurl.com/ot37js3. Authorities worry that criminals and terrorists will increasingly be using drones.

Palermo, Elizabeth, “Laser Weapon Melts Test Drone in Midair,” Livescience, Sept. 9, 2015, http://tinyurl.com/onfw4kr. A portable laser weapon that can fit in a suitcase could give authorities the ability to take down rogue drones in midair.

Scott, Alwyn, “Americans OK with police drones—private ownership, not so much: Poll,” Reuters, Feb. 5, 2015, http://tinyurl.com/z22lv8j. Results of online survey indicate Americans have mixed feelings about drones and how they should be used and regulated.

Surowiecki, James, “Why drone delivery won’t replace the UPS guy,” The New Yorker, Dec. 5, 2013, http://tinyurl.com/zwwzwxy. A business writer doesn’t believe drone deliveries will be the norm any time soon.

Swearingen, Jake, “1 Million Drones Will Be Sold This Christmas, and the FAA Is Terrified,” Popular Mechanics, Sept. 29, 2015, http://tinyurl.com/o4erjc5. The FAA is alarmed that drones may be one of the most popular holiday presents in 2015.

“Welcome to the Drone Age: Miniature, pilot-less aircraft are on the verge of becoming commonplace,” The Economist, Sept. 26, 2015, http://tinyurl.com/qjoz3pm. The rapid rise of drones has caught the world off-guard.

Whitlock, Craig, “FAA will miss deadline to integrate drones in U.S. skies, report says,” The Washington Post, June 30, 3014, http://tinyurl.com/ppauugt. A government audit finds that the FAA is far behind schedule in creating regulations to integrate commercial drones into the national airspace.

Reports and Studies

“Drones Take Flight: Key issues for insurance,” Lloyd’s of London, 2015, http://tinyurl.com/okm6e2h. International insurance marketplace analyzes the issues insurance companies have with the drone industry.

“The Economic Impact of Unmanned Aircraft Systems Integration in the United States,” Association for Unmanned Vehicle Systems International, March 2013, http://tinyurl.com/h3dfk5s. Trade association for the drone industry predicts that if drones are integrated into the national airspace, the industry will contribute $13.6 billion to the economy over three years.

“The First 1,000 Commercial Exemptions,” Association for Unmanned Vehicle Systems International, 2015, http://www.auvsi.org/1000report. The drone industry’s trade association analyzes 1,000 FAA exemptions permitting commercial use, breaking them down by industry, state, application and equipment.

“Overview of Small UAS Notice of Proposed Rulemaking,” Federal Aviation Administration, Feb. 15, 2015, http://tinyurl.com/mnkp7ot. The FAA outlines provisions being proposed for small unmanned aircraft.

“Section 333,” Federal Aviation Administration, undated, http://tinyurl.com/pfr5tot. The FAA maintains and updates a Web page that provides details on Section 333 exemptions that permit commercial drone use, including how many it has granted.

Hazel, Bob, and Georges Aoude, “In Commercial Drones, the Race Is On: Aviation’s Fastest-Growing Sector Outpaces US Regulators,” Oliver Wyman, 2015, http://tinyurl.com/olq3els. A consulting firm’s comprehensive report highlights how drone technology is advancing faster than regulators can keep pace.

The Next Step

International Regulations

Ames, Paul, “Why Europe Loves Drones,” The Week, May 17, 2015, http://tinyurl.com/hfdhyw6. European Union lawmakers in 2016 plan to develop rules for operating commercial drones across Europe that industry experts say will be superior to any comparable regulations in the United States.

Huifeng, He, “China cracks down on drone usage with new regulations but most consumers needn’t worry,” South China Morning Post, Dec. 1, 2015, http://tinyurl.com/h5kfycv. The Chinese government banned the use of small drones for commercial deliveries in cities and will require operators to register their devices with the country’s civil aviation authority.

Johnson, Tim, “As drone usage soars in Latin America, so do concerns,” McClatchy Newspapers, Aug. 31, 2015, http://tinyurl.com/p9cu7r3. Lawmakers in Mexico, Colombia and other Latin American countries hope to strengthen regulations regarding the operation of commercial drones to prevent accidents near crowds and to curb criminal activity across borders.

Licensing

Lee, Deron, “Why a drone journalism educator is getting his pilot’s license,” Columbia Journalism Review, Aug. 28, 2015, http://tinyurl.com/z8gruu4. A University of Nebraska-Lincoln professor is earning a light-aircraft pilot’s license to reopen his “Drone Journalism Lab,” in which he taught students how to use drones for reporting; the Federal Aviation Administration (FAA) shuttered the program in 2013.

Michel, Arthur Holland, “The cheapest way to get a drone license is to take hot air balloon lessons,” The Verge, Aug. 27, 2015, http://tinyurl.com/ohfwd39. Some who have received exemptions to operate commercial drones from the FAA have discovered the least costly way to meet the agency’s requirement that they obtain a pilot’s license is by getting a license to operate a hot-air balloon.

Thielman, Sam, “Drone owners get Christmas surprise from FAA: you will have to register to fly,” The Guardian, Dec. 14, 2015, http://tinyurl.com/h2slxo9. New rules from the FAA and U.S. Department of Transportation will require operators to register many recreational drones to fly them in the national airspace system.

Privacy

Burns, Amy Clarke, “Drones raise privacy concerns, questions,” The Greenville [S.C.] News, Aug. 19, 2015, http://tinyurl.com/h6hjnyz. Lawmakers in South Carolina, Tennessee and other states have proposed legislation banning private drone operators from flying their devices over private property or using them to take photos or conduct surveillance over such sites.

Finley, Klint, “Even Super-Small Drones Would Have to Register Under Federal Proposal,” Wired, Nov. 23, 2015, http://tinyurl.com/oue669x. An FAA rulemaking task force recommended that the agency keep all registered commercial drone owners’ information private in its proposed registry and exempt the data from disclosure under the Freedom of Information Act.

Pramuk, Jacob, “Drone battle’s next front: Your local government,” CNBC, Dec. 24, 2015, http://tinyurl.com/halmd8a. Lawmakers in 45 states have passed local ordinances or state laws restricting the use of drones, largely to protect residents’ safety and personal privacy, though the FAA says it will evaluate whether such measures conflict with its pending rules for commercial drone use.

Safety

Ranaivo, Yann, “Virginia Tech research: What dangers do drones pose for airlines?” The Roanoke Times, Dec. 3, 2015, http://tinyurl.com/zpfjshb. Researchers from Virginia Tech in Blacksburg, Va., one of six federally approved U.S. drone test sites, are studying the dangers of operating drones near manned aircraft in national airspace.

Rocheleau, Matt, “Close calls between drones, planes on the rise,” The Boston Globe, Dec. 21, 2015, http://tinyurl.com/nslb486. Pilots, air traffic officials and others reported 26 near-collisions between drones and airplanes or helicopters in Massachusetts to the FAA over nine months in 2014 and 2015, encounters that aviation officials said pose significant flight safety risks.

Shead, Sam, “A Belgian startup is trying to make ‘the world’s safest drone,’” Business Insider, Dec. 3, 2015, http://tinyurl.com/z2wg8z7. A Belgian technology firm created a one-pound drone it says would be the world’s safest; the device is a sphere with an enclosed propeller.

Organizations

American Civil Liberties Union
125 Broad St., 18th Floor, New York, NY 10004
212-549-2500
www.aclu.org
Advocacy organization for personal liberties and privacy rights.

Association for Unmanned Vehicle Systems International
2700 S. Quincy St., Suite 400, Arlington, VA 22206
703-845-9671
www.auvsi.org
Association representing drone industry and manufacturers.

Center for the Study of the Drone
Bard College, Campus Road, PO Box 5000, Annandale-on-Hudson, NY 12504-5000
845-758-7472
http://dronecenter.bard.edu/about
Research, education and art community working to understand unmanned aerial vehicles.

Center for Unmanned Aircraft Systems
John D. Odegard School of Aerospace Sciences, University of North Dakota, Clifford Hall Room 260, 3980 Campus Road, Stop 9007, Grand Forks, ND 58202-9007
701-777-2615
www.aero.und.edu
One of the country’s premiere aviation schools and research centers on unmanned aircraft systems.

Federal Aviation Administration
800 Independence Ave., S.W., Washington, DC 20591
866-835-5322
www.faa.gov
Federal agency responsible for regulating airspace and manned and unmanned aircraft.

Information Technology & Innovation Foundation
1101 K St., N.W., Suite 610, Washington, DC 20005
202-449-1351
www.itif.org
Research and educational institute focusing on critical issues at the intersection of technological innovation and public policy.

Small UAV Coalition
http://www.smalluavcoalition.org
Drone industry group that advocates for law and policy changes to permit the operation of small unmanned aerial vehicles (UAVs) beyond line-of-sight, and with autonomy, for commercial, consumer, recreational and philanthropic purposes.