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Strategic insights
Drones: The Future of Shipping

Written by on December 2, 2013

The internet is absolutely buzzing (literally) today about Amazon Prime Air. It's a serious attempt by Amazon to move into the drone-based delivery business. If you haven't seen it yet, here is the video:

Of course, Amazon is not the only company being allured by the potential of saving countless millions on labour costs (drones can fly 24-7 and completely automatic), combined with same-day (and even same hour) delivery. 5 months ago, Pizza Hut unveiled its research into the same (air) space:

And this not just happening the US. Experiments are being done all over the world. In China, the company SF Express is experimenting with something very much like Amazon. We have even heard about drones delivering mail and print newspapers (for those who have not yet discovered email and the internet). And in Australia, Zookal, is planning to deliver textbooks by the use of drones next year.

And two years ago Matternet published this video of how drones could help developing nations to skip a generation of infrastructure by the use of drones. A vision that I think has far bigger potential than any of the above.

In terms of future trends, I do believe this will be big, and why isn't FedEx or UPS experimenting with it? But this technology also comes with huge problems that we are nowhere near solving.

The first problem is civil aviation authorities, who are likely to not only be in bed with traditional shipping companies and their lobbyists, but they are also incredibly risk averse by nature. Just think of how long it took before they allowed us to use mobile devices on airplanes.

Amazon says "We hope the FAA's rules will be in place as early as sometime in 2015. We will be ready at that time." ... well, I don't think that's likely.

And don't forget that our politicians are in no rush to make this happen. Drones mean loss of jobs, which means a higher burden on social services for the unemployed.

The second problem is one of efficiency. While these drones seem to be brilliant in concept, they are also hugely inefficient. Think about it. A drone would have to travel from the fulfillment center to the customers and back again for every single package.

If three people in the same part of the city buys something from Amazon, the drones would have make three trips.

A delivery truck, on the other hand, can bring hundreds of packages on a single trip. So drone delivery is only useful in certain situations within limited areas of reach. If the volume (and reach) is too big, it becomes impractical and incredibly wasteful.

It might still be cheaper (in some cases) than hiring a person to drive around, but it's not a gold mine.

The third problem is how to deliver the packages. As Amazon conceptualized, the package is delivered in someone's back yard. But how did it know that was where it had to land? In the Pizza Hut example it delivered the package to a man waiting outside, but how did it know he was the one to give it to?

I guess this could be solved by having people download an 'Air' app. With it, you would go out to where you want it to land, hit 'mark', and the app would record the GPS coordinates and save that with your shopping profile.

That's the easiest and most accurate solution I can think of. This app could then also be used to track the drone, just like a FedEx tracking app. But there is a huge technical problem involved in actually getting this to work. And it would only work if you live in a house.

Note: GPS is accurate to about 5 meters +/-.

The fourth problem is noise. It's something few are talking about yet, but is likely to become a massive problem. These drones make a lot of noise, and the noise is very high-pitch... as in the most annoying form possible. The semi-professional ones usually make around 85-95 decibel of noise. In comparison, a normal vacuum cleaner makes around 70 db of noise. And if you stand right next to a freeway, that noise is also around 70 db. 100 db is the sound level of a jet engine taking off, or someone using a jackhammer.

Can you imagine living anywhere nearby one of Amazon's fulfillment centers? Or near a Pizza Hut? ...or near FedEx? ...or near, well, anywhere?

BBBZZZZZZZZZZZZzzzzzzzzzzzz.... All day long.

Noise in our cities has already become a huge complaint by many people, especially around our homes. Look at how much work is being done to soundproof everything. And to build sound barriers between public places and large roads etc.

As long as this is on an experimental phase, the number of flights will be so low that people would hardly notice them. The problem is one of scale. Having to endure the noise of a drone on rare occasions is just fine. Having to listen to it throughout the day is not.

The fifth problem is range. The Amazon drones will be electric (as opposed to gas powered), and we all know how bad batteries are. Of course, this won't be that much of a problem compared to the bigger 'second' problem mentioned before.

But one important problem with range is that for this to work for everyone, Amazon would need to have hyperlocal fulfillment centers in every city. I don't see how that would be economically feasible. The range of a FedEx truck is much greater than one of these drones.

BTW: People have also pointed to privacy issues, but I don't think that will be a problem at all. Why would you mount a camera when you can use far more accurate sensors to navigate?

From a trend perspective, these drone delivery systems are very interesting and truly fascinating. But outside developing countries, they are a very long way from a usable solution. The noise issue alone is a huge problem, and I don't see how we can solve that using rotary blades.

Another interesting solution is ground based shipping systems based on autonomous vehicles (nothing like the cars we see today, though). But that too has huge issues. For one thing, getting an autonomous vehicle to drive where it is supposed to is only half the problem. The next problem is how to get the package from the vehicle to your front door. It can't just dump it on the sidewalk.

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Thomas Baekdal

Thomas Baekdal

Founder of Baekdal, author, writer, strategic consultant, and new media advocate.

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