What To Look For At The Biggest Drone Event Of 2023

The Biggest Questions I have for 2023

The drone industry has grown tremendously over the past 5 years – Chinese manufacturer DJI has seen its 85% market ownership decline significantly in the US, the International Civil Aviation Organization (ICAO) has published guidance for member states on how best to approach regulatory support, and drone delivery has redefined logistics in a few parts of the world. Throughout that time, one major drone event has continued to be an industry benchmark for new technologies, new innovations, regulatory change, and the opportunity for the community to come together and share ideas. That event Association for Uncrewed Vehicle Systems International’s Xponential is just around the corner and in years past I’ve written a retrospective of the meeting; this year I’m doing something different. Instead of discussing what the industry saw, let’s look at what we might expect to see or hear in the coming days and why it matters in the context of the autonomous vehicle industry’s next steps.

Lots has changed since the last Xponential that took place in Florida in 2022. In the Advanced Air Mobility (AAM) and Uncrewed Aircraft Systems (UAS) industries we’ve seen new funding raises from one industry leader and lay-offs and downsizing in the tech industry that impacted operations at others, intense government restrictions on foreign manufacturers that opened the gateway for US players, international pressure to reform supply chains across government, success of the AFWERX program that has emboldened and supported the nascent AAM industry, and a proposal for an industry driven regulatory overhaul making its way through Congress. So, as the biggest drone show of the year starts next week, here are a few questions I hope are answered that will signal a real maturity in the industry; less hype and more action.

Proposed Legislation and the Impact on Regulation

In the past year the notion that wide-spread, industry enabling aircraft certification for small UAS was just on the horizon came crashing down. Previously, drone companies – especially those looking at scale to drive volume, lowering costs, and thereby driving profit – finally realized that a Type Certification that would enable that scale was not on to be expected any time soon. While this should come as a shocker to no one – given the rapid pace of innovation, the challenges that a silicon-valley iterative development cycle has in fitting into a traditional certification mold, and timescales necessary to create a meaningful certification – company leadership needed a pathway forward.

In February 2023, bipartisan legislation was introduced in the U.S. Senate and became a lifeline for UAS companies hoping to scale beyond a Part 107 VLOS restriction especially in drone delivery. Entitled the Increasing Competitiveness for American Drones Act of 2023, the main focus is to revitalize the “risk methodology” to allow for three categories of operations based on size.

· Operators of small UAS under 55lbs simply have to declare that they conducted a risk assessment and meet the standard, subject to audit compliance by the FAA.

· Operators of UAS between 55lbs and 1320lbs must submit materials based on the risk assessment to the FAA to seek a “Special Airworthiness Certificate.” UAS in this category may be limited to operating no more than 400 feet above ground level.

· Finally, operators of UAS over 1320lbs must undergo the full “type certification” process—the standard approval process for crewed aircraft.

Look, I know this may be a bit too down in the weeds for some readers, but essentially it is trying to force the FAA into a simplified version of the Specific Operational Risk Assessment (SORA) methodology enabled European 3 category approach, but instead of the nuance associated with an operation and all the math and effort put into developing that work, it looks exclusively at weight. While I don’t think this is the end game for integration, it may just help move the industry forward in the United States – especially for those who operate a drone under 55 lbs without aircraft that can be certified. One company in particular looks to benefit from the removal of a certification requirement; Virginia based DroneUp, who still must fly Visual Line of Sight of Operations (VLOS) and would see the removal of an airworthiness requirement for BVLOS delivery a major win. The legislation would also create a new position within the FAA, the Associate Administrator of UAS Integration, which would elevate and consolidate decision making for certification and approvals – a really good idea and probably the most important element of the work.

At #xpo23, I’ll be eager to hear how the FAA views this legislative proposal, get a better sense from industry how their supporting or fighting it, and to hear any news about those on the prospect of a new regime for approvals considering the 2.5+ years of investment in existing certification pathways.

Big Wins & Bigger Questions

Matternet, the only drone company with a Part 135 Certificate, Production Certificate, Type Certification for their aircraft – the M2 – has been unusually quiet. Since announcing operational planning in Abu Dhabi and deployment of their landing structures in Switzerland, we haven’t heard much about plans for sales, service, or partnerships and I’m hopeful we’ll hear from them at the show. If having both a Part 135 Certificate and airworthiness certification doesn’t mean success, then how are investors seeing a future of meaningful volume? What does ROI look like in a world where completing the requirements for success, doesn’t lead to success?

I’m hopeful that at the event Matternet will announce new partnerships, sales, operations, or deployments to really demonstrate that the regulatory pathway the industry has been following leads somewhere. If it doesn’t, then we may be more stuck than even the most pessimistic viewpoints believe.

I’ve always been a big fan of drone delivery and it’s been exciting to see the latest announcements from Zipline and Google Wing about the future of what both companies are calling “delivery networks.” After announcing a new vehicle, new infrastructure, new partners, and new modes of control, Zipline also announced a more than doubling of their valuation to $4.2 Billion.

It’s first worth saying congratulations, this market has been tough on the industry and tech more broadly and a valuation increase in this environment seemed impossible (full disclosure: the author worked at Zipline until earlier this year). Second, I’m really looking forward to understanding the economic considerations investors are making for the number of deliveries, as well as how the regulatory environment will meet those targets, and are needed to meet expectations. Even more so, we’ve seen a trend from the biggest delivery players (and data capture/inspection manufacturers and service provider companies like Skydio and DJI) toward installed infrastructure at point of delivery/take-off.

The Infrastructure Gap & Societal Acceptance

For drones, the advocacy efforts have always been to enable a continued national level federal ownership of the sky to prevent, as many colleagues explain, a “patchwork of regulations” that would make scaling extremely difficult. The question has been asked and answered, and it’s clear around the globe that if drones are considered aircraft, Civil Aviation Authorities (CAAs) maintain clear ownership of their governance. What is significantly less clear, however, is the ownership of oversight and approval for ground installations like those recently proposed by Wing and Zipline for their “delivery networks” or for inspection support for drones like Skydio, DJI, and Valqari. States and local governments have significantly greater roles to play in zoning restriction, inspection requirements, community sensitization guidance, safety protections, and equity protection on the ground – right where these new installations will be required.

Local municipalities, community stakeholders, and other governance groups will have a roll over installed infrastructure like those we’ve seen proposed recently and the way local groups choose to exert that oversight has not quite been established. I’m hopeful that we’ll see delivery and inspection companies talking about the immense amount of social engagement, societal sensitizing, and stakeholder development that has gone into this work or it’s likely we’ll see a much more difficult pathway forward for these infrastructure installations than those in the industry expect. Questions around route designing that supports equity in access and overflight are important ones to explore and answer. For those that say this work can’t be done before hand, a good example can be found in the collaboration between the World Economic Forum and the City of Los Angeles; the Principles of the Urban Sky.

There are too many other questions out there I am excited about, and for those who will be in the audience, let’s chat!

Who will be the new kid on the block stealing attention? What technology will be the most game-changing? Will we see the announcement of a new government approval or program as has happened in previous years? How has the recent data protection initiative – AUVSI’s Green UAS – performed; do businesses care about privacy, localization, and geo-politics in technology as much as the DOD?

I certainly don’t know, but I can’t wait to see you there!