Drone sector exciting but tough for Chinese startups

2017-04-27 10:03Global Times Editor: Mo Hong'e ECNS App Download

The tech world is widely known as the birthplace of a variety of startups, which seems especially the case in China. However, the fledgling drone market has turned out to be a tough place for startups, despite the strong growth expected for the sector.

And while China appears to have gained a head start in the drone space, with homegrown drone makers already known as leading lights of the industry globally, the government still needs to put in place rules to ensure a well-regulated drone market in the country and to avoid safety or security concerns.

The drone industry is expected to be increasingly a tale of two sections: While the consumer drone business still contributes to a fair chunk of the overall market in terms of sales, a growing focus is being given to the enterprise space.

A look into the future, it is believed, reveals substantial room for improvement in technical terms, although drone technology has gone through rapid development in recent years. The short battery lifespan, which in most cases is only half an hour, and drone communications that are easily prone to external interference are two of the areas that need to be upgraded. And in the case of specialized business applications, lots of efforts are still needed to explore deeper integration of drone technologies into specific industries. For instance, the use of drones in agriculture as crop sprayers needs to vary subtly according to different types of crops, latitudes and weather conditions.

All of this points to tremendous growth for the global drone market, which US research firm Gartner predicted in February will be worth more than $6 billion by the end of 2017 and north of $11.2 billion by 2020. The alluring figures, however, might not be easily translated into a bonanza for startups.

This is because the drone market actually has high barriers to entry, requiring comprehensive strength not only in technology but also manufacturing. It could be the case with the drone industry that startups that are capable of making prototypes will be confronted with difficulties in genuinely mass producing them. With the likes of DJI Innovation having gained supply chain dominance, it's not easy for new members in the drone space to focus purely on being innovative in drone design while not being able to actually deliver the products to consumers.

Also, it should be noted that along with robust growth in the market has come rising concerns over unregulated drone flights in China. The airspace over the country is not completely open, and to prevent drones from crashing into commercial planes or entering no-fly zones, there are already drones out there in the market with a built-in no-fly zone system. Still, some users operate self-made drones that come with no such systems and these drones have been seen entering no-fly zones.

That said, the still nascent drone industry, just like any new sector - for example, ride-hailing apps - will naturally pose a challenge to existing rules and regulations. The market should be brought under a regime that does not strangle growth but can ensure a well-regulated market.

It would make sense to separate oversight over drones into three segments: the drones themselves, users who operate the drones, and the airspace.

It is advisable therefore that users should register their drones, whether they are for commercial use or simply for leisure, and relevant government departments should work together to improve airspace management, for there to be reasonable supervision over drone usage. Drone makers, for their part, could provide technical support to help policymakers define rules that keep pace with the latest technology trends.

With the authorities and drone makers jointly mulling over rules to eliminate concerns over runaway unmanned aerial vehicles, it is expected that the country will hold onto its leading position in the drone world.


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