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Where Are The New Drone Business Opportunities?

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The new drone business and autonomous vehicles business opportunities may not be in the vehicle itself. The marketplace for commercial drones is starting to become a red ocean and that makes it more and more difficult to come up with a product that stands out (apart from unfortunate hoaxes, like the Lily or Zano).

Does that mean that fewer companies will appear in the following years? We don’t think so, but while it seems easy to copy existing products at a cheaper price or to innovate in a newborn niche, it is hard to keep a company afloat.

The Business Of Making Drones 

Relying in manufacturing means relying on selling repeatedly the same product expecting some growth. The only way to keep this rate of growth is improving periodically the platforms, so that customers keep coming back for the “new” thing. Big players in the industry like DJI, Parrot, Yuneec and 3DR adopted the same policy as companies like Apple: release the same product with improved features every year. This means lots of R&D and large expenditures in marketing that not every small manufacturer can afford.

Aeryon Skyranger Factory

Aeryon Skyranger Factory

We’ve seen many good products and disruptive ideas that sometimes took too long to get to the market, and by that time their technology was already obsolete. In the future we may see an evolution of the large drone manufacturers towards only design and integration (their core business). Other satellite companies will be the ones supplying the specific systems and doing the R&D, eventually being acquired by them.

Luckily, drone industry is still in its youth years and we hope that new players will surprise us with new and amazing drones.

The Business Of Using Drones

So will the industry and market reach the top any soon? Not at all! After the fever for the hardware, firmware, specs, and performance now come an even more interesting stage: the normalization of drones. In the drone business, the trend will switch to the actual use of such platforms and focus on the added value of the technology and the ecosystem around it.

 Some examples:

  • Technology to enhance drone operations: A fairly obvious question is what does a drone need to fly. The answer goes beyond the drone itself. See Skysense, for instance, focused on automating the battery charge and takeoff/landing operations.
  • Drones for emergencies: they have been tested in SAR, Fire and Police departments. Believe it or not, while some of them spent unjustifiable amounts on high-end platforms, many others started testing Phantoms and Bebops to discover interesting user cases. Unblur drone business is the best example of a startup entirely focused on drones and new technologies for emergency services.
  • Automation: The power of technology relies in simply making life easier. This includes all the hardware and software solutions that can truly allow a drone to operate with just a button push. That’s why Amazon is heavily investing in all the possible pieces that they will need to ensure their service. Never forget Safety!
  • Big Data: Forget for a while about the thrill of flying and think of the real value of having so many sensors up in the air. Increasingly big amounts of data have to be processed in a way that compensates the cost of using drones. Even better results are achieved when sharing this data between the users! (Pix4D, Airmap, Flock).
Photogrammetry for precision agriculture/ Drone Business

Photogrammetry for precision agriculture

  • Management: Probably the juiciest market in the drone business. This will allow drones to go on autonomous and beyond the line of sight operations with total safety. The whole rise of the industry in the next 10-15 years will depend on a robust and global management system (or systems). Some startups like Skyward are already working on that, but there is certainly a lot of work left!
NASA concept of drone management OPS

NASA concept of drone management OPS. Via: rt.com

  • Scalability: Lockheed Martin, Leonardo Helicopters, Airbus and even Boeing are putting (silently) their focus on drones. Don’t be surprised to discover that small drone engineering companies are being acquired by them.
  • Counter-UAV: yes… Anyone surprised?
  • Technical Support: Users want a technology that they don’t actually need to know anything about, but it rarely comes without some minor issues. Small companies may not be able to dedicate resources to have a support department, and we know that neither DJI is a great example of that. One of the biggest business in aviation are maintenance services, and those are not likely to run out of demand…

 Thanks for reading!

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