Drone startups jockey for business as FAA relaxes rules
New Federal Aviation Administration regulations on commercial drone use should make it easier for small operators to jump into the business of aerial surveying, mapping and similar activities, but that's only part of the job, established operators say.
“The flying part now is really the easy part,” said Rick Celender, vice president of Robinson-based Civil & Environmental Consultants. “It's the post-processing part that's harder. What you do with it once you bring it back is really what kind of separates the herd, so to say.”
For companies using drone technology in the construction, agriculture, real estate and oil and gas industries, the regulations likely mean there will be more competition in what is a relatively new field.
“Competition is a good thing in an industry,” said Luke Wylie, CEO of Butler County-based US Aerial Video. “But for someone who has a market share already, potentially losing customers to others is a concern.”
Wylie said he first realized drones' commercial appeal in 2011. Today, he runs his own small drone business and workshop out of his home, one member of a worldwide market valued at more than $127 billion in potential business services, according to PricewaterhouseCoopers.
The FAA rules, set to launch Aug. 29, will remove some of the most restrictive requirements on commercial drone operators, including receiving permission from the FAA required to fly a drone, dubbed a 333 exemption.
More than 8,800 exemption petitions are pending nationwide, the FAA said.
Another rule change means firms will no longer be required to operate drones with a pilot certified to fly manned aircraft.
The pilot rule has posed a particular problem for small, startup operators like Maurice Moye and his partner, Brian Contino, of Apiary Productions LLC of Carnegie. The pair spent the past year researching regulations, obtaining insurance and a federal tax ID number, and demonstrating their drone services to clients.
Aside from investing $1,000 to $2,000 on drones, they have tried to keep their overhead costs low. Hiring a pilot to fly or pay upwards of $10,000 for pilot training wasn't an option.
They're looking ahead to the end of the month, when all they'll need to do is pass an aeronautical knowledge test, offered at FAA Testing centers, including those in West Mifflin, New Castle and Butler.
Once they pass the FAA tests, they said they plan to offer surveying and 3-D modeling services to oil and gas companies at a fraction of the price it costs to perform such work from manned helicopters or airplanes.
Commercial drone operators in Western Pennsylvania said the marketplace for their services is far less crowded than in other parts of the country, such as the West Coast and Texas. Still, established companies in the area jockey for business by offering tailored services.
Wylie focuses on customizing drone hardware to tackle specific tasks.
If a client needs to fly a drone inside a small pipe, he might outfit it with “propeller-strike protection.” One recent project involved rigging a drone with a magnetometer, a tool that could help detect abandoned oil and gas wells.
Larimer-based Identified Technologies offers its oil and gas, construction and mining clients the option to collect data using drones; run the data through software to produce 3-D models; and then analyze the results in step with information about crew and equipment productivity reports.
“In essence, taking the data from yesterday, taking the data from today, comparing it, figuring out the trend, and telling you what we think is going to happen tomorrow,” CEO Dick Zhang said.
“This is sort of the secret sauce.”
While the new rules remove regulations, some remain.
Operators still must fly drones within their line of sight. They can't fly over crowded places, and must obtain special FAA exemptions and air traffic control permission to fly in areas near small airports and helicopter pads.
Bob Hanson, a senior vice president at Michael Baker International in Moon, said obtaining such permissions is complicated and time consuming, but necessary to operate in areas such as the Port of Long Beach, Calif., where his firm conducts engineering work using drones.
Michael Baker, with more than 6,000 employees in 90 offices nationwide, has the expertise and resources to navigate that process, Hanson said.
For now, most commercial drone applications are confined to sparsely populated areas far from airports.
Moye, who works as an IT professional by day, said his hope of one day running a profitable drone company is alive despite competition and some regulations that favor large corporations.
Succeeding, he said, requires finding a way to grow. For smaller companies, that likely means finding one thing to do well.
“It's the difference between being a massive powerhouse like Wal-Mart that can sell a product cheaper than anybody to everybody, or you're a little niche shop that makes something very beautiful with all of your effort and energy.”
Michael Walton is a Tribune-Review staff writer. He can be reached at 412-380-5627 or firstname.lastname@example.org.