State vs. state: FAA breaks down winners, losers in growing drone market


A new state-by-state analysis of the first 1,000 commercial drone permits shows a small, but growing nationwide industry.
As of September 1, the Federal Aviation Administration (FAA) had issued 1,407 so-called Section 333 exemptions to U.S. companies, clearing them to operate drones for commercial purposes. Presently the aviation authority issues about 50 Section 333 exemptions per week in an attempt to stay ahead of the thousands of applications it’s received since last year.
In a report issued this week, the Association for Unmanned Vehicle Systems International (AUVSI) breaks down data surrounding the first 1,000 drone permits by state, offering a far more granular view of the U.S. commercial drone industry than we’ve seen to date.
Their report found that commercial operators now fly in 49 states, using vehicles manufactured in 22 states. An overwhelming 85% of companies holding Section 333 exemptions are small businesses. Applications span a variety of industries, but are largely tied to aerial data gathering. However the states with the most companies operating commercial drones aren’t just the biggest states, but territories with major aerospace and aviation industry hubs, like California, Texas, and Florida.
“It’s encouraging to see the UAS industry benefiting from every corner of the country, with manufacturers located in almost half of the states,” Brian Wynne, AUVSI’s president and CEO, says. “These figures will likely become even more apparent when the FAA finalizes its small UAS rules, which will allow companies to fly without having to go through the exemption process.”
The UAS rules are a set of new FAA commercial drone regulations expected sometime in the first half of next year, which will replace the current case-by-case approval process now under Section 333. While the current Section 333 process may be onerous for the industry, it offers a unique opportunity for the FAA and groups like AUVSI to gather data on how and where commercial drones are being deployed, as well as what kinds of companies are using them.
The big winner in AUVSI’s breakdown of the data is unsurprisingly California, home to 114 approved commercial drone operators. The first six Section 333 exemptions granted last year went to companies in the film and television industry, an industry that accounts for roughly 9% of the first 1,000 exemptions granted nationwide. The Bay Area is home to several of the U.S. drone industry’s most visible players, including Skycatch, DroneDeploy, and 3D Robotics. The state’s vast agriculture industry has also provided a fertile testing ground for many new drone technologies as everyone from almond growers to vineyard owners looks to new means of minimizing water usage while maximizing quality and yield. Agricultural applications account for 164 of the first 1,000 commercial drone permits, and AUVSI expects data-driven farming to be a leading growth driver for the drone industry.
Florida and Texas follow California in number of commercial drone operators, with 97 and 82 Section 333 permits respectively. Like California, Texas is also a big state with lots of real estate to survey, lots of agricultural data to mine and lots of golf courses to advertise. The real estate industry accounts for roughly 35% of the first 1,000 commercial drone permits, followed by “general aerial surveying,” a kind of catch-all category for non-specific aerial inspection of land or property, at 30%.
But more telling than the data surrounding these top three drone states is the relatively wide, relatively even distribution of Section 333 permits across the other 47. Every state in the U.S., with the exception of Delaware, now boasts at least three commercial drone operators, and most are home to a dozen or more. While a dozen operators here and there doesn’t necessarily spell boom times for the commercial drone industry, it’s worth noting that the FAA has more than 1,000 applications it hasn’t even reviewed yet, with more piling up every day.
The most interesting data in AUVSI’s analysis has nothing to do with the state-by-state breakdown and everything to do with the kind of companies applying for commercial drone permits nationwide. “At least 84% and as many as 94.5% of all approved companies are small businesses,” the report says. This is partially a reflection that the majority of businesses in the U.S. are small businesses, Wynne says. But there’s more to it than that.
“Many of the low-risk operational profiles permitted by the exemptions, such as aerial photography, apply well to small businesses, such as real estate and photography,” Wynne says. “In many cases, large companies are testing UAS in countries with more established risk-based, technology-neutral regulations, such as Canada and Australia. Larger businesses are mainly focused on more complex operations than are currently allowed by the exemption process.”
This news is both good for small business operators and a sign of what’s to come for the larger commercial drone industry. AUVSI has previously predicted that drones will generate $82 billion in economic impacts (and 100,000 jobs) in the decade following the implementation of comprehensive commercial drone rules. However, as long as U.S. commercial drone regulations remain in limbo, Wynne says, larger companies like Google GOOGL -0.77% and Amazon AMZN 0.70% will continue to develop their drone technology elsewhere.
“In order to continue reaping the economic benefits that [unmanned aerial systems] offer, we need to do all we can to support the growth and development of this industry by providing clear rules for those who want to use UAS,” Wynne says. “But the longer we take, the more our nation risks losing its innovation edge along with the billions of dollars of economic impact.”
By Clay Dillow for FORTUNE
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New super-precise drones could win over wireless industry

Credit: PRENAV
PreNav beta-testing drone- and cloud-based inspection system

PreNav demos precision drone flights via an LED lightshow
Big IT companies have largely been mum on plans to use drones, but emerging technology from Bay-area startup PreNavappears to have at least intrigued wireless service providers and cell phone tower operators.
Founded in 2013, PreNav has secured $1.2 million in seed funding and is working on raising Series A financing. It is currently beta testing its precision drone technology, which carriers/tower operators could use to inspect towers in a safer and more efficient manner. The drones could zoom in on everything from nuts-to-bolts (literally) and cabling, plus deliver 3D images that customers can use to determine a tower's structural status. And with more than 100,000 towers in the U.S. alone, that could present PreNav with a big opportunity.
Other potential customers include wind turbine operators, such as early user Senvion, as well as outfits overseeing everything from bridges to dams to oil rigs.
HOT STUFF: The coolest drones
PreNav next year plans to roll out its 3-piece system, which consists of roughly 9-pound industrial grade drones, a ground-based guidance robot that includes a powerful embedded processor, a camera, laser rangefinder and wireless tablet for the user interface, plus cloud-based software to process, analyze and share data. The robot scans the structure and then guides the drone around it "with centimeter-level accuracy" to take photos that are then turned into a 3D reconstruction. This is a much more precise and reliable system than those based on GPS technology, which has difficulty understand the relationship between a drone and a structure being examined, according to PreNav.
PreNav is pushing this video in which LEDs on drones are used to showcase precise flying patterns.
PreNav claims the system, initially targeted at the U.S. market, can be operated via the touchscreen interface even by those who don't have manual piloting skills. What's more, PreNav says it is working to enable tower inspection, including drone setup, in less than an hour.
The startup is the brainchild of CEO Nathan Schuett and CTO Asa Hammond, who previously worked on camera systems and computer vision applications as contractors for Google and some Bay-area startups. Among Hammond's claims to fame was developing a robotic motion control system for a design firm (and eventual Google acquisition) called Bot & Dolly used to shoot the movie Gravity.
The company's drone system would seem to sync up well with the direction of the FAA, which has been overseeing drone/unmanned aerial vehicle (UAV) rules in the United States.
"PRENAV supports the notice of proposed rulemaking (NPRM) issued by the FAA back in February 2015. By removing the requirement to have a certified pilot in command of the aircraft, drones can be used by a much broader range of people, namely the existing industry of climbers, technicians, and anyone who is inspecting or maintaining industrial assets. Further, the rules focus on drones that fly within line of sight of the operator, which aligns well with the applications PRENAV is targeting with our system."
With drone rules becoming clearer in the U.S., funds increasingly have been flowing into drone-focused startups. One of PreNav's investors, Drone.VC, for example, specifically targets drone companies. Crunchbase showed that some $210 million had been pumped into drone startups this year through mid-June.
By Bob Brown for NetworkWorld
Worldwide UAV Market to Triple in Ten Years

“The market for UAVs looks very strong, increasingly driven by new technologies such as the next generation of unmanned combat systems, and the development of new markets such as civil and consumer drones,” says Philip Finnegan, Teal Group’s director of corporate analysis and co-author of the study, titled “World Unmanned Aerial Vehicle Systems, Market Profile and Forecast 2015.” “Consumer UAVs are showing that they can do many of the easier commercial missions such as simple real estate photography,” he adds.
Civil UAV growth is also continuing to grow, say Teal analysts. “Our coverage of the civil UAV market continues to grow with each annual report, mirroring the increase in the civil market itself,” said Finnegan. “Our 2015 UAV study calculates the UAV market at 72 percent military, 23 percent consumer, 5 percent civil cumulative for the decade.” Of the three areas, civil UAVs grow most rapidly over the forecast period as airspace around the world is opened, but it grows from a very low base.
“The Teal Group study predicts that the U.S. will account for 64 percent of total military worldwide [Research, Development, Test, & Evaluation] RDT&E spending on UAV technology over the next decade, and about 38 percent of the military procurement,” says Teal Group senior analyst Steve Zaloga, another co-author of the study. The larger, higher value systems procured by the U.S. help drive the relative strength of the U.S. market over the decade.
UAV payloads, such as electro-optic/infrared sensors (EO/IR), synthetic aperture radars (SARs), SIGINT and electronic warfare Systems, and C4I Systems, are forecast to double in value from $3.1 billion in Fiscal Year 2015 to $6.4 billion in Fiscal Year 2024, Teal analysts say. EO/IR remains the default sensor for the majority of UAVs, but in recent years have seen inconsistent funding and considerable uncertainty, as legacy endurance UAV production has ended, they add.
New sensor markets will see significant increases as radio frequency (RF) systems replace EO/IR capabilities, and next-generation UAVs at all scales require much more sophisticated – and expensive – sensors. “Rapidly increasing capabilities for RF sensors will be funded, as potential conflicts shift from clear-skies Central Asia to the more restrictive geographies of Eastern Europe and the Pacific,” says Dr. David Rockwell, author of the electronics portion of the new study. “And out-years [Unmanned Combat Aerial Vehicle (UCAV) and nano-UAV procurements will see much more expensive and capable sensors.
“UAVs will continue to provide the world’s fastest-growing aerospace payload market, but not through continued growth of ‘the usual suspects’ from the past decade. Instead, new sensor programs for current and future air vehicles will result in more unexpected growth spurts and losses,” he continues. “We now forecast a number of speculative new programs in the out-years, including estimates of classified programs. Wise companies will plan today for growth tomorrow.
The Teal report also has a UAV Manufacturers Market Overview that reflects the worldwide UAV market “again continuing as one of the prime areas of growth for defense and aerospace companies,” Finnegan says. “UAVs are no longer of interest only to aerospace companies, but increasingly technology companies like Google, Facebook, and Amazon see a need to be in the market.”