While delivery drones might beÂ an excellent PR vehicle for Amazonâs Prime membership brand, they will not be an excellent vehicle for very much else â at least not in the short term. Rather they will be âmired in logistical issuesâ, reckonsÂ analyst Gartner, which has just published a drone market forecast looking ahead to 2020.
The analyst is expectingÂ delivery drones toÂ make up less thanÂ less than one per cent of the commercial drone market by 2020, asserting that it doesÂ not expect them to be âa major factor for several yearsâ.
As well as complex logistical issues, such asÂ the time needed to return a drone to its origin point after delivery, the analyst points out that a return on investment for drone deliveries has yet to be proven â putting another dampener on the prospects of any broadÂ rollouts of the tech.
Amazon kicked off a delivery drone trial in the UK in December, but, laughably, the âbeta trialâ has just two users. (And a very limitedÂ selection of products availableÂ forÂ drone-freighting to the bottom of their gardens.) Safe to say, Prime Air does not appear on the verge of delivering anythingÂ more substantial than Amazon marketing fictionsÂ for the foreseeable future.
Gartnerâs prediction is also that delivery drones wonât be delivering packages to consumers first, but are more likely to be deployed within or between businesses where there are fewer logistical challenges to overcome. âWe expect that delivery drones will begin finding a niche in business to business applications first, particularly for internal services within one company where logistics will not be such a big factor,â notesÂ senior research analyst,Â Gerald Van Hoy, in a statement.
Despite being downbeat on delivery dronesâ prospects, Gartnerâs forecast notes rapid growth in production of drones for both personal and commercial use, with overall global market revenue expected to increase 34 per cent to reach more than $6 billion this year â rising toÂ more than $11.2BN by 2020.
The analyst projects a total ofÂ 2.9MÂ drones will be produced in 2017, an increase of 39 per cent from 2016Â â which it characterizes asÂ âsubstantial growthâ for the market overall, though it notes theÂ dynamics of the personal and commercial drone submarkets are very different â with the personal drone market being much larger andÂ its drones havingÂ a significantly lowerÂ average selling price.
On the personal drones side, Gartner describes the techÂ as an âaffordable extension of consumersâÂ smartphones for taking photographs, selfies and for other entertainment optionsâ. It reckons some 2.8M drones will be produced in the category this year (vs just ~174,000 commercial drones).
When it comes to commercial use-cases for drones, the analyst is most bullish about the industrial inspections segment â i.e. where drones areÂ deployed for uses such asÂ inspecting remote oil and gas infrastructureÂ â saying it expects the segment to dominate commercial use-cases, taking 30 per cent of the market through to 2020. It says regulations have caused fewer problems than expected here.
But itâs a different story forÂ agricultural use-cases, where itÂ says growth for commercial drones hasÂ been constrained by pricing and economic constraints â so itâs expecting drone adoption for this segment to be limited to just seven per cent through to 2020. Point being, if the economics of drones donât work, drones wonât work.
Perhaps unsurprisingly, given large priceÂ differentials between commercial vs personal drones, and the relative surfeit in production of the latter gizmos vs the former, Gartner notes increasing overlap between the two markets â with lower priced drones being appropriatedÂ for commercial ventures. But then again, as youâd expect, withÂ ROIÂ constraints putting limits on businessesâ use of drones it makes sense for companiesÂ toÂ seek the mostÂ cost-effective options to make use of the tech, especially as drone techÂ matures and more interesting applications come on stream.
âPersonal drone vendors are now aggressively trying to position themselves in the commercial market,â notes Van Hoy, adding: âRecent technological advances blur the lines, allowing personal drones to be used in many special purpose applications such as surveillance, 3D mapping and modeling.â