The Truth About Drone Delivery No One Is Talking About

So when will drone delivery become a reality? It would be sweet to order stuff online and get it dropped off super quickly. But are there any problems holding up drone delivery from being widely done? Yes.

I’ll cut through the noise and help you understand the real reasons (the ones that no one is talking about) as to why drone delivery is taking longer than we expect.

Article Table of Contents

Background on the Drone Delivery Craze

Drone delivery has been all over the news with Amazon being the first to announce the projected use of drones to make deliveries. Others have followed the trend and announced deliveries such as the drone burrito delivery, the drone pizza delivery, etc.

In 2015, Dave Vos, the former head of Google’s Project Wing, said to an audience, “Our goal is to have commercial business up and running in 2017[.]”  Fedex, UPS, DHL, and Walmart have announced they are interested in drone delivery. Then, as if we hadn’t enough drone delivery buzz, Amazon published on December 14, 2016 a video showing their first customer delivery using a drone.

Up until August 29, 2016,  we only had the Section 333 exemption process (now the 44807 process), the public certificate of waiver or authorization (which is statutorily prohibits commercial operations), or the airworthiness certificate process coupled with a certificate of waiver or authorization – all three are difficult to operate under in reality and only two allow commercial operations. Thankfully, Part 107 went into effect on August 29, 2016 and is far less restrictive than the previous three options. This is why you might have noticed that after August 29th, the drone delivery announcements and the accompanying photos in the U.S. have started to look closer to what we envision a drone delivery should look like.

In April 2019, Wing Aviation LLC (a subsidiary of Alphabet) obtained a single pilot Part 135 air carrier operating certificate. In October 2019, United Postal Service (UPS) obtained the highest level (standard certificate) of Part 135 air carrier operating certificate. On August 27, 2020, Amazon was granted their exemption and also around this time issued a Part 135 operating certificate.

Benefits of Drone Delivery

Medical Delivery. The idea of drone deliveries, in general, is not only just delivering potato chips but also for more legitimate humanitarian purposes. A great example of this is the company Matternet, which partnered with UNICEF to do drone delivery in Malawi with the end goal of developing low-cost delivery of blood samples from children to be tested so medical drugs can be given to them when needed and in time. John Hopkins University has been doing blood drone delivery tests and published their findings in a medical journal.  Zipline has also done many humanitarian missions in Africa– they can save money, time, and lives.

Time Savings. A drone has very little chance of encountering a traffic jam scenario compared to ground transportation. Time-critical missions would best be performed by a drone that is reliable and far more cost effective than a manned helicopter operation.

Able to Get to Hard to Reach Places Quickly.  This is great for delivering medications or life-saving packages at very precise locations.

Positive Public Perception. Drone delivery is really a small portion of the drone market, but thanks to Amazon, it is the “face” of the commercial drone industry. This has gone a long way to clean up a lot of the public stigma about the drone industry.  People tend to think of Amazon delivery, not predator drones. Kudos to Amazon for changing that. These drone delivery announcements have worked so well that when I tell people I’m a drone lawyer, I almost always get asked about when drone delivery will become a possibility for everyone. My answer is: not anytime soon…..and it isn’t because of one of the most frequently raised issues which is privacy.

Privacy Issues –Frequently Raised, but not a Drone Delivery Legal Barrier.

Many are concerned about drones doing deliveries where they fly over residential neighborhoods and potentially capture data of people. I don’t think privacy issues are going to be a barrier because of the following reasons:

(1) In the terms of service, legal language will be used to the effect that says it’s cool with the property owner to have the drone descend over their house and drop off the package.

(2) Missy Cummings, a professor of mechanical engineering and director of the Humans and Autonomy Lab at Duke University, provided one potential solution of drone delivery companies and other companies partnering for delivery points. “Perhaps Starbucks could be your intermediary point.”

(3) Amazon’s patent on drone docking stations (attached to light poles or cell towers) won’t have property/privacy issues because that will all be taken care of in a contract agreement with the cell tower and power companies.

(4) Drones flying at 400 feet can be argued to be in public areas. See the Florida v. Riley U.S. Supreme Court case saying, “there is reason to believe that there is considerable public use of airspace at altitudes of 400 feet and above[.]” When you descend below 400ft, it would be a weaker position to defend regarding privacy claims. This would be heavily influenced by state and federal circuit law.

(5) Part 135 air carriers are protected by the Airline Deregulation Act that prevents states from enforcing laws “related to a price, route, or service of an air carrier.” 49 U.S.C. § 41713(b)(1).

These points above are not justifications to completely ignore the privacy issue. I think is a legitimate issue that companies would do well to consider but it is not a barrier.

Most Drone Delivery News is of Operations Either Overseas, Within Visual Line of Sight, or Some Narrow Scoped Operation

Most of what you have seen in the news is either in other countries, with different laws, or in rural areas of the U.S.

Some of the companies are just doing deliveries to themselves, not others.

Some are just doing visual line of sight drone operations under Part 107.

Even though things have become better because we have Part 107 and the new update to Section 44807, areas of the law are slowing down drone delivery at large scale.

Drone Delivery Problems

Problem 1: FAA’s Part 107 Drone Regulations

These are the drone regulations that went into effect on August 29, 2016.

Part 107 does NOT allow air carrier operations. “‘[A]ir carrier’ means a citizen of the United States undertaking by any means, directly or indirectly, to provide air transportation.”[1] “‘[A]ir transportation’ means foreign air transportation, interstate air transportation, or the transportation of mail by aircraft.”[2]  Bummer.

One interesting point is that Matternet did obtain approval to fly package delivery under Part 107.

Why? They were flying for one hospital company in one area and it was extremely limited. The Department of Transportation basically determined this was not an air carrier since it was so limited.

Here is where things start to get limiting under Part 107 for drone delivery:

Following up on the last point, where are the most customers? Near cities.

What are near cities? Airports….everywhere. Let’s just pull some data from Arizona’s Amazon fulfillment distribution centers. Taxjar’s blog listed five address in Arizona (but it really is only four buildings).

  • #PHX3 – 6835 W. Buckeye Rd. Phoenix, AZ, 85043 – Maricopa County
  • #PHX5 – 16920 W. Commerce Dr. Goodyear, AZ, 85338 – Maricopa County
  • #PHX6 – 4750 W. Mohave St. Phoenix, AZ, 85043 – Maricopa County
  • #PHX7 – 800 N. 75th Ave Phoenix, AZ, 85043 – Maricopa County

I took these addresses and plugged them into the sectional map (green stars with green arrows) which shows us all the airspace in the Phoenix area. Calm down. I made it easy for you. I used to say to my flight students when I was flight instructing that these maps were like a form of job security because they are confusing to read. I marked out the areas where the drones cannot fly under Part 107 in red, unless they have an authorization or waiver.

drone-delivery-amazon-fullfilment-center-arizona

Two of the fulfillment centers are in controlled airspace and would require an authorization or waiver to just take off.

What I think is the most limiting of all the regulations is the drone must be within line of sight of the pilot in command[3] This is an extremely important point.

Drones, due to their size, are only able to be seen out to a certain distance under a best case scenario. This can be estimated. I have a best case scenario visual line of sight calculator I built. You can plug in the dimension and an estimated best case scenario max range will be generated. Using that calculator, a drone that has a cross section of 14 inches can, in a best case scenario, can only be seen out to 4,010 feet. From an economic standpoint, you have to go beyond line of sight to reach the greatest number of potential customers per unit. Using the 14 inch cross section drone scenario, consider the two outcomes:

  • Visual line of sight only – 0.45 square miles.
  • Beyond visual line of sight limited by a max radio line of sight of 2 nautical miles – 4.1 Square Miles

But the big problem here is that Part 107 does not allow Part 107 package delivery operations under a beyond visual line of sight waiver. You’ll need to fly outside of the Part 107 regulations all together which then triggers ALL sorts of other regulations many have never heard of such as Part 91, Part 119, Part 135, etc.

Also, if you are interested in learning about how to read charts and understand airspace, check out the Airspace & Chart Reading for Drone Pilots Course I made over at Rupprecht Drones which teaches you how to do a pre-flight review of airspace, airspace classifications, basic operational requirements, airspace resources, examples, and more! This course has over 40 videos, 114 multiple choice questions, and a checklist to help you review what you need to check before you fly. Airspace and chart reading is tested on the initial and recurrent Part 107 Remote Pilot Exams, and this course can be beneficial when studying for those exams.

Problem 2: FAA’s Section 44807 Exemption for Commercial Drone Operations

Part 107 does not allow BVLOS drone delivery to the general public. The other way is to fly under Part 91 which requires the aircraft to be airworthy. Here is the problem: there are no drones with airworthiness certifications. The way around this is the operator obtains a Section 44807 exemption determination from the Department of Transportation saying the drone doesn’t need an airworthiness certificate.

It’s a lengthy process and requires a lot of paperwork.

On top of that, Section 44807 is only for the aircraft. You’ll still need an exemption from parts of Part 135 to carry packages for other people.  If you think the exemption process is difficult, the Part 135 air carrier certification process can be brutal.

Thankfully, Google’s Wing Aviation, LLC managed to obtain the exemption and Part 135 operating certificate.  But, the Part 135 operating certificate was for a single pilot. Yes, this was the easiest of the Part 135 certifications to obtain but this means in the near term you won’t have drones flying all over the place because it is currently just one guy. …..and he works for Google.

UPS also obtained an exemption for package delivery and also obtained a Part 135 operating certificate. UPS is what I would consider the first real operational approval because of the 4 types of Part 135 certificates, UPS received a standard operating certificate “with no limits on the size or scope of operations. However, the operator must be granted authorization for each type of operation they want to conduct.”

Problem 3: States, Counties, Cities, & Towns All Regulating Drones – Death by a Thousand Papercuts

Amazon’s business model is that the drones will provide a lower cost of delivery.

Darryl Jenkins, who worked on the economic study outlook for the Association of Unmanned Vehicle Systems International, said in his presentation,“Amazon will be able to push the per unit cost of delivery to at least $1.00 per package causing all other competitors to either adopt or die.” This is because of the economies of scale. But here is the problem, with a greater number of drones and drones operating across the U.S., more and more non-federal drone laws will need to be complied with.

Most people have four layers of government applying to them. These governments might have created drone laws. For example, where I used to live on Palm Beach Island, I had four layers of drone laws that applied to me: the Federal Aviation Regulations, the State of Florida’s Freedom from Unwarranted Surveillance Act,[9] Palm Beach County’s ordinance prohibiting model airplane flights in county parks, and Palm Beach Island’s drone ordinance.

It isn’t super hard to track the state drone laws from 50 states and the federal government, but we don’t know everything that is going on with all the counties, cities, towns, villages, boroughs, etc.

It’s not a patchwork quilt of drone laws, it’s worse. It’s like a huge puzzle, and you have only a couple hundred pieces so you have to go on a scavenger hunt to find the remaining pieces, but you don’t know if you need 1,000 pieces or maybe 10,000 more and the number of pieces just keeps growing.

Also, local governments use all sorts of different terms to describe the same thing, such as unmanned aircraft, drone, model aircraft, etc. (they like to pretend they are the FAA) which further increases the times it takes to search.

These unknown areas are going to have to be checked into which means there is a need for a drone regulatory compliance department in Amazon which means $$$$. If the cost of compliance goes up, Amazon’s business model starts to make less and less sense compared to what they are already doing now.

Another aspect of these non-federal drone laws is that some of these laws are motivated not by the desire to decrease public risk, but to increase revenue. As a greater number of the non-federal regulators start catching on, Amazon and all the other companies interested in drone delivery start looking like revenue generators for local governments. Even if the local governments aren’t greedy, their focus on safety and protecting their citizens generally results in some type of “safety” requirement that needs to be proven before they issue a permit/license which further drives up operating costs for the companies.

We all understand the Amazon most likely won’t save any money at first on drone delivery, but the with a greater amount of drone laws getting created, lobbying, compliance, monitoring, insurance, permitting, etc. will all start eating further into the cost savings which means costs savings won’t be realized for years and years down the line. At a certain point, one or two guys operating out of big delivery van starts to look like a good idea again.

Because of these local drone ordinances & state laws, drone delivery suffers death by a 1000 regulatory papercuts.

But is there anything we can do to not have all the hassle with the state and local laws?  Yes.

The Airline Deregulation Act says,

“Except as provided in this subsection, a State, political subdivision of a State, or political authority of at least 2 States may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route, or service of an air carrier that may provide air transportation under this subpart.”

49 U.S.C. § 41713(b)(1). The case law is very favorable to air carriers (Part 121 and 135 operators). So if you stay pure Part 107, you are subject to potential state and local laws causing trouble but if you go Part 135, even with all the crazy headaches, you still get the benefit of your operations being preempted from state and local laws related to your price, route, and service.

But obtaining a Part 135 operating certificate is not an easy walk in the park.

How to Become a Part 135 Drone Delivery Operator

A drone company wanting to be a Part 135 air carrier for drone delivery operations will need the following: (1) an exemption from all the regulations they cannot comply with (because these regulations were all originally designed for manned aircraft), (2) Department of Transportation Economic Authority to operate as an air carrier, and (3) a Part 135 operating certificate from the FAA.

(1) Obtain An Exemption From Regulations That Are Too Burdensome

Two of these exemptions have already been granted. Basically, you have to submit a petition for exemption and a bunch of support documentation showing that your operation would have an equivalent level of safety as the regulations you are trying to get exempted from.  This is all public unless you confidentially submit the supporting information and manuals. The only thing that can never be confidential is the petition for exemption.

The FAA reviews this petition and may deny, partially grant, or fully grant the petition. An exemption can be granted that lasts 2 years which then will have to be renewed over and over again. You’ll need to have a granted exemption BEFORE you’ll obtain and operating certificate.

(2) Obtain DOT Economic Authority

The FAA is responsible for safety while the Department of Transportation is responsible for economic authority. Many miss this point and it is a reason why some companies are not doing drone delivery.

Matternet had to obtain a very limited approval to fly for the hospital and Flirtey currently has a pending application because these companies do NOT meet the definition of U.S. citizen.  There are federal criminal penalties for package delivery done by non-U.S. citizens (except for narrow exceptions).

You must obtain DOT economic authority prior to being granted an FAA Part 135 operating certification.

(3) Obtain An FAA Part 135 Operating Certification for Drone Delivery

Assuming you have exemption and DOT economic authority, the 135 process is:

Phase 1 — Pre-application. This is you meet with some FAA inspectors to discuss the process and what needs to be done.

Phase 2 — Formal Application. You need to submit the application, manuals, and all the other associated documents for the FAA to review.

Phase 3 — Design Assessment. This is where you will most likely stall out. This is where the FAA reviews all the documentation, manuals, management personnel, etc. to make sure you meet all the regulatory requirements. I’ve done 6 Part 137 operator certifications and this is where things get bogged down.

Phase 4 — Performance Assessment. This is where you actually have to demonstrate things. This isn’t like Part 107 where you take some computer based exam. Real live aviation inspectors are going to come out and watch you do everything. They are going to ask you questions to determine your knowledge, and have you preform operations and maneuvers to validate your aeronautical skills. This is like the operations check ride.

Phase 5 — Administrative Functions. This is where the FAA prints out and sends you everything. This is an important time to make sure they fill out everything and all the documentation is correct. The FAA will also schedule follow up inspections to make sure you are doing what your manuals said you would be doing.

The Different Types of 135 Operating Certificates

There are four different types of Part 135 operating certificates:

Single Pilot. This is what Wing Aviation obtained. It’s one pilot for all operations. That’s it. It’s a one man band.

Single Pilot in Command. This is an operation with one pilot-in-command and up to three second-in-command pilots.

Basic Part 135. The operations are limited in size and scope. You can only have a max of 5 pilots, 5 aircraft of which there is a max of 3 different types, and some other limitations. That’s not going to work for more drone delivery operations.

Standard Part 135. This does not have a limit on size and scope BUT each type of operation must be approved.

Drone Delivery Companies (Current List Part 135 Drone Delivery Operations)

The information below is current as of July 2020.

Google Wing Drone Delivery

Wing Aviation LLC was the first to receive a 135 operating certificate. It was originally a single pilot operating certificate. On their operating certificate they have 25 aircraft listed (Hummingbird V2-7000). The Richmond Flight Standards District Office is their certificate holding district office.

UPS Drone Delivery

UPS Flight Forward Inc. is the Part 135 operator and has the highest level of certification (standard). It presently has 2 Matternet M2-V9 aircraft on the certificate. The Greensboro Flight Standards District Office is the certificate holding district office for their operation.

Amazon Prime Air

In August 2020, Amazon obtained a Part 135 operating certificate and exemption but it was very very narrow in scope. Amazon “stated its plan for initial part 135 operations was to deliver parcels of up to 5 pounds using its MK27 aircraft to a distance of up to 7.5 miles from the launch point over rural farmland within a UAS test range.”

Matternet Drone Delivery

Matternet originally obtained DOT approval to transport medical specimens at a hospital in North Carolina.  In February 2020, they obtained DOT approval to do medical specimen transportation in California.

Flirtey Drone Delivery

As of July 2020, they are trying to obtain DOT approval to do cargo delivery in Nevada. Their application is pending.

Future of Drone Delivery (Who Will Be The Early Adopters)

Those that Value Time More Than Cost

There are some industries and markets that are more concerned about time than cost such as:

(1) Those that need delicate, limited, expensive, rare types of medicine immediately because the alternative is injury or death.

(2) Those that rather just have their medications be delivered to their front yard than drive to the pharmacy while being as sick as a dog or potentially being exposed to diseases.

(3) The rich guy down by the remote lake wants an anniversary gift (that he forgot to buy) for his wife right now. Maybe this should be in the (1) category because it’s kind of life or death?

Where the Cost of Not Operating is More Expensive than the Delivery

Consider critical pieces in a costly operation. For example, a large piece of machinery broke down and there are many people that the company is paying to just sit around waiting for replacement parts. That machinery could be producing something or performing a task that is essential to generating profits. How costly is it per hour to have the machinery NOT running?

Those That Do Not Have Any Other Choice (There is no Next Best Alternative or it is Outside of Their Purchasing Power)

The drone might be the only feasible solution due to weather, disaster, lack of infrastructure, etc. (Think hurricane relief or Alaska bush pilots flying supplies into remote villages). If you are delivering to remote areas, you look at things differently. Flexport’s article discussing Matternet’s drone operations in Lesotho explained:

As Raptopoulos of Matternet points out, Google and Amazon’s plans ignore drones’ best feature: they can go where there are no roads.

“One billion people in the world today do not have access to all-season roads,” Raptopoulos told a TED audience in 2013. “We cannot get medicine to them reliably, they cannot get critical supplies, and they cannot get their goods to market in order to create a sustainable income.”

For the Matternet team, the most interesting question was not the cost per delivery. They wanted to compare the cost of the drone network to the cost of building the roads Lesotho so badly lacks.”

Drone Delivery Frequently Asked Questions

Are drones being used for deliveries?

Yes, they are currently being used at a few locations around the United States. Some operations are serving the public while others are transporting cargo for the company’s internal operations (they are not holding out to the public).

How does drone delivery work?

Most operations appear to be a fixed brick and mortar location that serves as the launching point. Most operations appear to be within line of sight. The customers are in the surrounding areas. A customer would order online and the drone delivery the payload to the customer at a pre-determined location.

What companies use drone delivery?

UPS is presently using them in The Villages, Florida.

Where is drone delivery legal?

It is presently legal in the United States. The issue is not legality but jumping through all the legal hoops. In other countries, cargo transportation is legal but the issue is integrating drones into the regulations that were designed originally for manned aircraft operations.

Will drone delivery happen?

Yes, it’s a matter of time but the complex regulatory environment is slowing things down. Only a handful of large companies have the cash to attempt this and there are few attorneys who can assist in navigating these areas.

Conclusion:

Many have written on this topic because they see the technology taking off. They see the progress in the technology that many have made and assume that drone delivery will be allowed soon. They get the “West Coast” mindset where they think if enough money and technology are thrown at the problem, it will be fixed regardless of the law. Additionally, most writing on or marketing drone delivery do not understand all the legal issues.

Aviation is an “East Coast” industry where the laws out of D.C. will heavily influence the business. Aviation is an extremely regulated environment. The economics are determined AFTER the regulations are applied. The faster the companies operating in this area realize that fact, the better off they will be so that they can actually do these types of operations.

[1] 49 U.S.C. § 40102(a)(2)

[2] Id. at (a)(5).

[3] 14 CFR § 107.31.

[4] 14 CFR § 107.19.

[5] 14 CFR § 107.35.

[6] 14 CFR § 107.25.

[7] 14 CFR § 107.39

[8] 14 CFR § 107.41.

[9] F.S.S. § 934.50.