“[00:00:20] Charlie Rose: Bezos kept telling us that he had a big surprise, something he

wanted to unveil for the first time [...] Bezos: but there's no reason they can't be used

as delivery vehicles.”

Within a matter of years autonomous drones would engulf cities, sweeping across skies,

delivering packages to front yards just thirty minutes after their order.

The announcement floored Charlie Rose and America alike—grabbing headlines for weeks

and setting off fiery debates over just how disruptive the disruptive technology would

be.

Drones would offer urban and suburban consumers a clean, quick, convenient delivery option

for food, medicine, or whatever else five-pounds-or-less without burning fossil fuels, without getting

stuck in traffic, without making them wait.

The idea felt far-fetched, it was exciting, it was the future arriving in front of our

very eyes, and it signaled that the race to take delivery drones to market was on. 

By the time Amazon landed its first package, Zipline was already delivering medical supplies

in Rwanda, SkyDrop had flown a 7-Eleven slurpee and a Dominos pizza straight to consumers,

and Google's Project Wing had air dropped burritos to hungry college kids.

A wave of startups sent their maiden drone deliveries skyward to much media fanfare while

major parcel couriers—DHL, UPS, FedEx—substantiated the hype by partnering with the budding tech

companies set to help solve their last mile problems.

Inventors, investors, eccentric billionaires, and the world's biggest companies were all

pulling the same rope.

Anything, anywhere, anytime: the dark days of Doordash and two-day delivery were over;

the drone delivery era was coming… or so it seemed. 

It's now 2022 and save for the smallest fraction of a percent of people, it's not

automated drones dropping off your small packages and food orders.

Pizzas aren't falling from the sky, they're showing up in the hands of a highschooler.

Burritos aren't delicately dropped on your lawn from above, they're left on your doorstep

by a hustling gig worker.

Your Amazon order won't show up in thirty minutes, it probably won't even show up

same-day.

The world 60 Minutes introduced in 2013, the world that felt closer and closer to reality

with every inaugural delivery, just isn't here. 

Fundamentally, the fast delivery niche still exists.

The last mile still accounts for around 40% of parcel shipping costs, roads are still

increasingly clogged with traffic, green shipping alternatives are still desperately needed,

and consumers still want products as cheap and as fast as possible.

Outside of a few specific locations, drone delivery has yet to take off—and in those

few specific locations, it's hardly more than a proof of concept.

Certainly, delays are understood—expected even—when it comes to the acceptance of

a disruptive technology.

Delayed acceptance though, is at very most only part of the story. 

In 2021, Amazon fired staff and closed its Prime Air offices in the UK.

From the former center of Amazon's drone project emerged stories of mismanagement and

disarray: employees drank beers at their desks, managers were given no direction, executives

ignored the stalling division aside from the occasional pizza party.

While the company responded to these reports with a statement affirming its continued investment

in drone delivery, Amazon hasn't released any promotional material for the project since

2016 and Prime Air's website doesn't seem to have been updated in years.

The most generous possible interpretation is that Amazon's project is definitively

on the backburner.

Others aren't even there.

While Amazon remains quiet on their future intentions, DHL announced in summer 2021 that

it was officially abandoning its parcelcopter project nearly eight years after it's maiden

flight. 

So, two of the most important drone delivery companies put their programs on ice, few companies

are getting the investment they used to, and no company has yet realized the imminent future

of widespread operations laid out a decade ago.

So, what went so wrong with drone delivery? 

Well, this is Phoenix—a sprawling desert metropolis home to 5 million people.

On first glance, Phoenix seems the perfect candidate for a drone delivery service: its

year-round sunny, dry, still climate would make for easy, reliable flight conditions;

its autonomous innovation friendly city and state governments would welcome them with

open arms; and its sprawling, low-density neighborhoods would make for countless hungry

and impatient residents lacking walkable dining and shopping options.

Surely, this is the low-hanging fruit.

Surely, a drone delivery company could come in, connect any house with any product within

minutes, and demand would immediately outstrip supply, right? 

Well, perhaps not.

Connecting any house with a drone delivery provider doesn't quite work because in the

center of the city, right here, is Phoenix Sky Harbor International Airport.

In order to assure the safety of arriving and departing aircraft at the busy hub, the

FAA restricts the use of drones within this area.

So, a Phoenix drone delivery service probably just couldn't operate here… and here,

in the restricted airspace around Luke Air Force Base… and here, around Phoenix Goodyear

Airport… and here, and here, and here, here, and here.

It's not entirely impossible to operate drones within restricted airspace, but, from

a legal perspective, it ranges from somewhat to extremely difficult—enough that it probably

wouldn't be worth pursuing for a drone delivery company, at least at the start. 

The rest of Phoenix, though, is fair game… to an extent.

You see, drones need somewhere to deliver to, and it's got to be safe.

When the concept was first introduced, the vision typically presented was of a drone

flying down, landing on one's lawn, releasing its delivery, then taking off and flying away.

That didn't work…

at least not in reality.

Drone delivery is a novel technology and, like any novel technology, the public views

it with an air of distrust—the worst thing the industry could do is prove that distrust

warranted with a series of high-profile accidents at launch.

The first instance of a delivery drone injuring a customer will inevitably ignite a media

firestorm, which could lead to a legislative clampdown, so manufacturers naturally must

strive for perfection.

Perfection is tough to scale, though.

Delivery drones must act autonomously to be cost competitive, and autonomous operations

require computer vision and artificial intelligence able to reliably identify a clear landing

zone.

Determining whether someone is behind or infront of a window, noticing when a dog is running

towards the drone, knowing what's a pool and what's dry ground—these are all challenging

for a computer to tackle on its own, and so attaining perfection proves rather difficult. 

Therefore, whereas the logistics field generally considers the last mile of delivery the most

difficult—once the economies of scale are gone—drone delivery is a last mile solution

with its own last foot problem.

It's fairly straightforward to get a drone to a couple dozen feet above the ground—getting

a package safely to the ground has proven more challenging. 

Some solutions have emerged: Zipline, focusing on longer-distance delivery to a set number

of facilities with dedicated delivery zones, drops its payload in a packaging with an attached

parachute that carries it to the ground.

Matternet also uses dedicated zones for delivering to commercial facilities, while they've

developed a system of delivery stations for use by urban consumers.

Uber Eats, meanwhile, implemented a scrappy yet inefficient system where delivery drones

would land on the top of delivery drivers' cars, then those delivery drivers would walk

the food to the customer's door.

Most solutions for the last foot problem, however, have gravitated towards one method.

Wing, Skydrop, Flytrex, Wingcopter, and others have developed systems where their drones

hover above the destination at a safe height and lower their payloads to the ground using

cords—far less risky than landing a heavy drone propelled by fast-moving rotors.

What all these solutions have in common is that they require a roomy, controlled, obstruction-free

area to make their final deliveries.

However, in the places where people actually live, that's hardly a given.

Yards are the best delivery zones that are widespread, but not everyone has a yard.

While it's a safe bet for single-family homes in an area like Phoenix, it can be hit

or miss whether multi-family homes and apartment buildings have a big enough yard and, even

when they do, their communal nature means that the customer couldn't necessarily guarantee

that the landing area would be free from obstructions as would be the case with their own, private

yard.

So, at least for an early drone delivery service, it probably wouldn't work in restricted airspace

and probably not for anything beyond single-family homes either. 

These and other legal, technological, and practical constraints combined mean that the

scope of what works in terms of drone delivery is narrow.

It's pretty easy to start crossing off cities—Boston's winter is too harsh, New York's density

inhibits yards, DC's airspace is too restricted, Pittsburgh's landscape is too hilly, this

could go on and on.

Even within the cities that might work, there are only so many areas that might work.

While it varies by company, most delivery drones tend to be able to fly to deliveries

as far as about six miles away.

So, assuming early operations would base out of a single location to capture economies

of scale, meaning their drones would have to return to said location to charge after

each delivery, that means a viable first delivery zone in Phoenix—optimizing for a large area,

free of airspace restrictions, centered on wealthier neighborhoods—would be this.

310,987 people live in this zone—a small chunk of the metro area's 5 million.

However, in Phoenix, only 63.2% of housing units are single-family, which are likely

to have the private yard necessary for a delivery, and only 92% are occupied meaning, in this

prime zone, at least extrapolating using city-wide data, which is the most precise available,

there are only 180,820 possible users of a drone delivery service.

This is, clearly, an imprecise methodology, but it's indicative of how the prospect

of drone delivery—the prospect of anything, anywhere, anytime—is getting diminished,

and diminished, and diminished down into a niche service for a lucky few.

A small system linking a strip mall to the neighborhood behind it, a fixed route flying

COVID vaccines from a distribution center to vaccination sites, six shops delivering

to a small part of a small town in Virginia—drone delivery has hardly moved beyond proof of

concept, and it's not even clear that they've proved the concept. 

 In 2016, when asked about same-day delivery, 70% of respondents said they were content

with the cheapest option while just 23% of respondents said they'd pay more for same-day.

For drones to prove commercially viable they'd need to decisively corner that quarter of

more willing consumers, and to become ubiquitous, they'd likely need to operate at no extra

charge from ground delivery at all.

Most people, it turns out, are simply okay with waiting a day or two for their packages,

while all want them delivered as quickly and as cheaply as possible. 

When the drone delivery hype hit fever pitch, one bit of nuance went overlooked.

Consumers simply don't care about how a package gets from b to c, so long as it's

quick, cost-efficient, and reliable—they'd opt for a new technology once for the novelty,

but by the 100th time that wears off.

Eventually rationality will return.

In fact, when surveyed in 2020, consumers perceived drones to potentially threaten those

most important factors for delivery—they said they were uncertain about drones' reliability,

cost, and were worried about the job loss they could incite.

Meanwhile, competitors have figured out a number of low-tech solutions that fulfill

these consumer desires: look no further than food delivery apps. 

Since 2017, the very moment when drone delivery hype hit fever pitch, the food delivery industry

has tripled in size, ballooning into a $150 billion sector globally.

In this, speed matters and consumers expect to pay for the delivery cost—facts that

seemingly pave a lane for drone delivery.

But between Uber Eats, Grubhub, and Doordash, the power players are already established

and the competition is already fierce.

These comparably low-tech companies don't even tell the consumer whether to expect their

burger to come by car, moped, bike, or foot; they just prioritize getting food to doors

quickly, pleasing the consumer regardless of method and undercutting drone delivery

in the process.By-and-large, food delivery apps closely match the upside of drones within

urban and suburban areas without the hassle of complying with FAA guidelines and figuring

out the last foot problem.

Adding to the competitive problems facing drone startups, these companies and others

have since expanded into grocery, medicine, and goods deliveries.

Put simply, from the consumer perspective, the problem drone delivery was designed to

address has already been solved without building out a massively complicated aerial delivery

network. 

The current low-tech, gig economy model isn't perfect, though.

For consumers and restaurants alike, the usage fees are expensive; for those delivering,

the pay is minimal; and for the big players, profit has proved elusive.

One partial solution is automation.

Here still, though, drones are likely to lose out.

Ground-based autonomous and semi-autonomous robotics have begun popping up in test markets

and partnering with the likes of Uber Eats and Grubhub to expand their reach.

While a recent partial ban on sidewalk-wandering robots in San Francisco points to the hurdles

the technology faces, these hurdles just won't be as numerous as those facing drones.

Automation and technological advances may well help smooth out food and last-mile delivery.

In the near future, your prescription, your lunch order, or your afternoon coffee might

be showing up at your front door courtesy of an autonomous vehicle—you'll just need