Drone market to hit $127 billion by 2020

Yes, some like to call them flying mini robots, or unmanned aerial vehicles or even miniature pilotless aircrafts. Either way, what is interesting is that these playful “toy like” devices, progressed into the commercial space rather quickly. One of the most recognized companies that have been spearheading the transition is Amazon. However they might be first movers, but ultimately every commercial entity will catch up with the trend. For example, Chinese or Indian firms may have even better plans for Africa based on the results of American pilot schemes.

Focussing on what is known for now: Amazon, the e-commerce giant started its Prime Air project, aimed at speeding up is shipping services. This comes as the company currently uses delivery trucks, which means that there are some logistic issues.

To change this, the company has been investing heavily in drone technology as a means for delivering its products. As part of that strategy, the company filed a patent application in December 2015, which was published by the U.S. Patent and Trademark Office. The other patent Amazon filled was that of blimps stocked with drones to make additional speedy deliveries. This patent was filed in April of 2016.

Nevertheless, the patent filed in December of 2015, was for a beehive-like tower that will have a cylinder-shaped centre. This beehive-like tower would serve as multi-level contentment centre, and it would be used for the delivery drones to take off and land. In addition, these towers would be supporting truck deliveries, but would also include self-service areas. These self-service areas are planned so that people can pick up their goods themselves it they like. Otherwise, drones would do the deliveries.

In essence, the facilities would be located within urban areas and to help it blend it with the high rises in the urban environment, the facility would be constructed vertically. More so, the company also plans to have one of these facilities within every city. Furthermore, the placement of the facilities in the cities, instead of outside urban areas where these types of fulfilment centres are mostly located, are not the most convenient if not an efficient approach to delivery, especially where most people are moving towards city environments anyway.

Did you know that drones are not something new? These devices have been used before for filming and television productions. All the same, drones have also been used in the military, farming sector, and construction. That said drones are still in its beginning stages relating to a commercial application.

Some of the benefits that a company could experience would be increased productivity, efficiency, but also less workload and production and labour costs. Adding to that, better accuracy and refining the services, as well as solving some security issues.

Still, as the generation 7 drones are being developed, it is believed that by 2020, commercial drones will be fully operational and meet the safety and regulatory frameworks. As such these drones, which will be much-sophisticated drones that what we have seen now, will be doing everything from fertilizing crop to monitoring traffic as well as monitoring sharks at swimming beaches.

As the movement is towards drone technology, many are investing in it, for example, Goldman Sachs invested in this technology by sponsoring interactive content on the Washington Post where it set out the bank’s research on this technology.

Nonetheless, it is predicted by PricewaterhouseCoopers that the demand for commercial drones will grow more speedy between now and 2020, with a market of around $100 billion. More, the value of the drone market will be around $127 billion by 2020. Thereby a rise of $27 billion in three years.

Most of the drone market is still with government with around 70%, still, it is expected that commercial drones could add around 100 000 new jobs to the United States’ economy.

The bottom-line: Drones, which were seen as devices used by governments and hobbyist, are now going commercial. As this evolution of this technology is advancing, new possibilities are being explored.

One such company is Amazon, which has a keen interest in drones and the application to help with its delivery. This company has already invested a lot into this planning and testing phases, and as the new generation drones are being developed, research firms and banks are already looking into investment opportunities.

However just as Apple failed to block innovation in the case of Samsung, Amazon should not think that its patents will prevent Chinese and other global players from taking their fair share of the drone market.