Monday, January 16, 2017

Broad acceptance of drones — and industry growth — depends on smart regulation

Rules generally rub Nevadans the wrong way, but a lack of them in one of the state’s potential growth industries soon could cause problems.

Drone industry leaders and government officials bantered during a CES panel discussion last week on regulation, specifically what needs to be done to create a clear set of guidelines from the federal level on down to the neighborhood streets.

The race, as both sides see it, is against time: one major accident involving a drone could cause public panic and knee-jerk political response before those working on a comprehensive solution can present their case.

“When you look across different industries, we have different socially acceptable levels of safety,” said Brendan Schulman, vice president of policy and legal affairs at China-based DJI, the world’s largest drone company. “A pretty serious car accident doesn’t make the news anymore, but a minor drone accident does. Acceptance will come when that doesn’t happen.”

Industry groups and regulators have talked for close to a decade about how to regulate the unmanned aerial vehicle (UAV) industry without stifling innovation. Discussion of domestic drone operation stretches beyond those purchased as Christmas gifts and into those used for commercial purposes such as farming operations and inspection of gas pipelines.

Economic development officials in Nevada see the drone industry as a pivotal piece of the aerospace and defense vertical in their diversification plan, though it largely focuses on larger UAV for military applications. In 2013, the Federal Aviation Administration (FAA) approved Nevada as one of six sites in the country for testing the best way to integrate unmanned small aircraft into the national airspace, and the designation was recently extended through at least 2020.

The City of Henderson and Nevada Institute for Autonomous Systems (NIAS), a nonprofit arm of the governor’s economic development office, announced last week plans for a small-drone testing range adjacent to Nevada State College. The site will feature a 150-foot runway, four vertical take-off and landing pads, an observation tower, a flight operations control center and a large netted drone area.

Aerodrome also announced last week a partnership with Boulder City for the Eldorado Droneport, touted as the world’s first commercial droneport on 50 acres approximately four miles south of the U.S. 95 exit beyond the Railroad Pass Casino.

“One of the other things that’s going to drive consumer adoption is consumer acceptance,” said Josh Turner, an attorney with Wiley Rein LLP who represents clients before the FAA and FCC. “It becomes much more socially acceptable once you have that first experience.”

The FAA released a fact sheet in June 2016 as initial guidance on the safe operation of drones for both hobbyists and professionals. Comprehensive regulation for drone development continues to plod along at a pace more suited to government than the rapid advancement of drone technology, though. Earl Lawrence, director of the FAA’s Office of Unmanned Aircraft Systems Integration, asked industry panelists at CES to provide direction on specifics that would allow the government to provide something that looks more like a framework than a hard set of rules.

“A good regulatory structure helps these products come to market because the insurance industry wants to know,” Lawrence said, referencing that industry’s inability to assess the risk of drones without knowing how they will be built, operated and maintained safely.

One of the primary divides in government is an age-old discussion with regard to technology, as explained by California State Assemblyman Evan Low, D-Silicon Valley.

“A vast majority of my colleagues do not share the same viewpoints as I do,” Low, 33, said. “A millennial from Silicon Valley thinks very differently about drones than a 70-year-old from Santa Barbara.”

Safety concerns coming from the public include what is being filmed by drones, the odds that they can be hacked and what happens if one crashes from as high as 400 feet, the max altitude for hobbyist drones. And that doesn’t factor in those hobbyists who won’t know the rules and might fly their machines in ways that endanger people and the future of the tech’s growth in the consumer market.

“Any one of these things could be a death blow to the industry in a particular place,” Turner said.

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