This Thursday, the American Technology Council (ATC) will meet with leaders from emerging technology industries at the White House. Several reports note that one of the docket items up for discussion will be the state of commercial unmanned aerial vehicles (UAVs)—that is, drones.
To that end, the newly formed ATC should consider the following:
- Modernizing the FAA regulatory process;
- Easing the Federal Aviation Administration’s (FAA) rules to promote domestic investment of commercial drone technology; and
- Privatizing the Air Traffic Control System to accelerate the integration of UAVs in U.S. airspace.
Addressing the aforementioned points enables the United States to be a leader in the commercialization of UAVs. The benefits of UAV technology are potentially enormous—from delivering packages in 30-minutes to delivering internet from space—but this still-nascent industry needs regulatory surety to actualize its full potential. The inability of federal agencies to keep pace with technological progress can hinder domestic investment and innovation in this space. If the government drags its feet on this, entrepreneurially-minded firms will look to more innovation-friendly countries to set up shop—a phenomenon known as global innovation arbitrage.
Drone technology has the capability to realize cost-savings and efficiencies in a variety of industries like construction, agriculture, insurance, logistics, and more. Relaxing drone regulations that limit their operation to visual line-of-sight (VLOS), allowing autonomous operations of drones, and eliminating the flight over non-operators restriction will help to produce a favorable environment in which commercial drone innovation can thrive. Other countries, like Japan, have already taken steps that will allow delivery drones to operate beyond VLOS as early as 2018.
According to a Goldman Sachs report, the drone industry could be a $100 billion market opportunity over the next five years. The report notes that this is only the beginning, but the key to unlocking the full economic potential of commercial UAVs lies in “regulatory clarity.”
Consider Uber’s Elevate project, which aims to “enable rapid, reliable transportation between suburbs and cities and, ultimately, within cities.” Uber cites the potential productivity gains as a result of hours saved commuting to and from work. This is just one of the many benefits of urban drone transportation networks. The company intends to demonstrate the technology by 2020—technology that relies on the ability to operate autonomously over non-operators beyond VLOS. Thus, the reality of a network of fully autonomous air-taxis shuffling urban dwellers to and fro is largely dependent upon a modern regulatory framework capable of addressing the needs of emerging technologies.
In order to safely accelerate the integration of commercial drones in national airspace, the ATC should also focus its discussion efforts on the need to privatize the Air Traffic Control system. A privatized system can build upon developing Air Traffic Management systems like NASA’s Unmanned Aircraft System Traffic Management (UTM) initiative or Google’s Project Wing, and produce a viable system much faster than the FAA currently can on its own.
As the Niskanen Center’s Ryan Hagemann noted in a blog post, the FAA “is simply unable to keep up with the pace of technological progress in this area, and every day we delay holds the potential for investors and talent to flee to friendlier countries.” In order to ensure we realize the full potential of commercial drone operations, we first need to get the rules right. Reforming and relaxing the current FAA rules and promoting a privatized Air Traffic Control system will go a long way in reaping the benefits UAVs have to offer American firms and consumers.