One of the most important lessons of the internet age is what happens when we give people — including companies, developers, engineers, hobbyists, and yes, even a few bad (or dumb) actors — a new platform, along with the freedom to innovate on top of it. For example, who could have predicted how profoundly the internet would change our economy, given how it started off as a research project — one where commercial applications were actually frowned upon in the early days?

Now, the U.S. is on the cusp of opening up another such platform for commercial and social innovation: airspace (think drones, the non-military kind). There’s so many use cases for drones that we already know about, but what about new business use cases? And then, on the policy front, how do we calculate the risk of innovation on a platform made up of atoms (drones) vs. bits (the internet)? What are the pros and cons of registration? Because even though drones are like flying smartphones controlled by software, they’re also hard objects that could fall out of the sky … or go places where no one could go before, for better or worse.

The guests on this episode of the a16z Podcast — continuing our D.C. and tech/innovation/policy theme — share their thoughts on safety, privacy, paper airplanes, and what they think are some of the most exciting things now possible in airspace. Joining the conversation are Washington, D.C.-based Mercatus Center tech policy lead Eli Dourado, along with graduate research fellow Samuel Hammond; Airware founder and CEO Jonathan Downey; and SkySafe CEO and co-founder Grant Jordan.

Show Notes

  • The current state of drone technology and potential use cases [0:57]
  • Creative applications for using drones [10:04] and barriers to innovation [14:00]
  • Issues with safety [19:23] and privacy [28:55]
  • Discussion of new potential developments on the horizon [33:07]


Sonal: Hi, everyone. Welcome to the “a16z Podcast.” I’m Sonal. And today’s topic, continuing our D.C. theme, is drones, and more broadly, policy and airspace as a platform for innovation. Joining us for that conversation, just to really quickly do the intros, we have Eli Dourado. He directs the technology policy program at George Mason University’s Mercatus Center. And he’s here with Samuel Hammond, who is a graduate research fellow in that program. And they’ve done a lot of research in policy reports around drones. And then we have Jonathan Downey, who is the founder and CEO of Airware, which provides operating systems for commercial drones, so enterprises can take advantage of aerial data for business applications. And we also have Grant Jordan, who is the CEO and co-founder of SkySafe, which is the company that provides security for airspace — for example, by taking control of and safely landing rogue drones. 

And, by the way, those are both a16z companies, full disclosure. We have another drone’s investment, Skydio — which focuses on onboard intelligence by giving drones the same visual awareness and agility of human pilots — but they couldn’t join us today. So those are the intros. And now let’s just get started. 

Innovation in drone technology

I think the place to start off is, you know — Eli, you wrote an op-ed for me a few years ago, where we talked about airspace as the next platform for innovation. And I thought that was a really eye-opening concept for me, and I think we need to just break down what each of those terms mean. Like, what is airspace, why a platform, and why is it the next platform for innovation?

Eli: Well, yeah, when I wrote that op-ed — I think it must’ve been about three years ago when I was first starting to get interested in drones. And the thing that I noticed immediately was that drones are completely legal to use for hobbyist purposes, and completely illegal to use for commercial purposes. And it reminded me of the internet back in the 1980s, right? The internet in the 1980s, it was this research program that the government had, but there were guidelines. You know, MIT had an AI lab, and the guidelines for students were, like, “You may not use this for any commercial purpose. We can get in trouble with the government.” It’s just illegal. 

And I thought about the people running this program. They didn’t mean to, like, hold back the internet. They were, I’m sure, very well-intentioned. They wanted this to succeed, and they weren’t thinking about how much holding something back from commercial operation was likely to affect the success, right? If they knew where we were today, they would’ve allowed commercial use from the inception, right? And so to me, I was just thinking about — what would people do with airspace if they could use it for commercial purposes if it wasn’t — you know, we’ve had remote-controlled airplanes for decades. Hobbyists use them, so in that sense, consumer drones are nothing new. But you can’t do anything commercially. And so, what would people do if you could use it commercially?

Sonal: And Jonathan, I think this is something you can weigh in on, because you are the founder of a company that is doing software for commercial drones.

Jonathan: Yeah, happy to. And, you know, I totally agree. Three years ago, around the time you wrote that article, we looked at the global landscape for commercial drones. And most everyone at that time was thinking about consumer and hobbyist drones, and they were thinking about large military aircraft, but this idea of using drones for commercial applications was relatively new. And when we looked at the landscape, most of the companies who were doing anything meaningful in the space were international. They were in Australia, they were in France, they were in the UK. There were only a few countries where they either said, “Hey, we’re not going to regulate this at all. We’re going to allow it.” Or they said, “We’re going to have a process by which you can be a commercial operator of drones.” 

And the UK and France were really leading the way there, with hundreds of commercial operations years ago. And many of the companies in the space said, “Well, we’re just going to ignore the U.S., or if we are in the U.S. we’re going to start all of our sales, and operations, and research and development outside of the country.” And only now with this Section 333 exemption process — and, hopefully, soon with Part 107 — do we see a lot of those companies that either started internationally expanding their operations to the U.S., or a lot more of these companies that are in the U.S. starting to get some commercial traction.

Sonal: What is the Section… What was the regulation that you just cited?

Eli: So, Part 107 is the new proposed small UAS rule and it will, sort of…

Sonal: Buy UAS, you mean unmanned systems?

Eli: Unmanned Aerial Systems.

Sonal: Right, Unmanned Aerial Systems, yeah.

Eli: So, this is the FAA term. But we call them…

Sonal: Which, by the way…

Eli: Cool people just call them drones.

Sonal: Right, that includes drones, which just for a quick definitional thing on drones — because I think people actually are still confused by this sometimes. I noticed this in the early days of this community, an online community about drones — which is that drones are different than RC copters in that they can fly waypoints. And so they can follow, like, a preprogrammed path, and that you can — they’re not, like, remote-controlled, basically, in that context.

Eli: So, the terms do get, like, blended, and so on. But yeah, I would agree that what we’re interested in here is some partial or full autonomy at some point. That you’re going to eventually be able to just tell it what you want it to do and it does it.

Sonal: Okay, and so back to section whatever.

Eli: So, the Part 107 rule is — back in 2012, Congress, actually with some foresight…

Jonathan: It was actually with a lot of lobbying from large commercial industries. 

Eli: A lot of lobbying, but good for Congress, they passed a provision of FAA reauthorization bill at the time to require that FAA come out with commercial drone rules by September 30th, 2015, which was, you know, several months ago.

Jonathan: Came and went.

Eli: It came and went. They’re still not out. But they’re coming. It’ll probably be sometime next month. There will be some permanent commercial drone rules. And in the meantime, as Jonathan said, we have these 333 exemptions that basically allows people to, sort of, negotiate or apply with the FAA to say, “I wanna operate commercially for this purpose.” And the FAA might allow it, or might not.

Sonal: And what are some of the purposes and use cases that you guys are seeing people put to — I mean, what are the — why would they want those exemptions, basically?

Jonathan: Yes, so the Section 333 exemption process was created last fall. And now just, you know, 9 months later or so, there’s over 4,000 granted exemptions in the U.S. for commercial use of drones across a variety of different industries. But we’re seeing a lot of exemptions in our own customers using drones in the insurance industry, in agriculture, in utilities, in all types of industrial inspections — oil and gas, land management, forestry, wildlife conservation. You know, that’s one of the things that I think is so interesting about this industry, is just the wide variety of applications and use cases. They’re really endless. We’re hearing about new ones all of the time. And I really think, you know, it makes that analogy to the early internet, you know, very, very real, in that it was designed and developed with several really important use cases in mind. But ultimately, when it was, kind of, released into the wild and, you know, not just people “with authority to develop it,” but really all kinds of people everywhere were adding capabilities to software and to the internet — is when we really saw this, you know, bloom in all the different uses for it.

Grant: It’s totally the case that we don’t even know what the real killer apps for drones are yet. You know, I think there’s a couple of spaces that are, kind of, obvious that we’ve been thinking about so far of, you know — delivery, and inspection, and all these sorts of things. But there’s so much potential there, it’s, kind of crazy. You know, I think part of — a lot of our focus is on thinking a little bit further forward about the airspace management aspect. You know, I think using commercial drones early on in the process is pretty easy when they’re still very expensive. When the sorts of companies that can use them are still very limited. 

You know, much like security in that early internet, right? When the internet is just a connection of a bunch of research centers and government, then it’s not — security is not really that big of a problem. Everybody on there is trusted. Everybody on there is doing the right thing. But as those barriers to entry start coming down — as, you know, anybody with 500 bucks can be flying a drone — suddenly it becomes, kind of, a different story. And suddenly, you know, people who don’t really know the rules of the road, who aren’t really sure what they’re doing, or have actual malicious intent — they, kind of, start coming to the party as well.

Sonal: So you guys are, kind of, getting ahead of that. I want to take a step back for a moment and think about again — we’re all really reinforcing this concept of airspace as a platform for innovation. I think it’s actually, kind of, shocking to think about what it means to be able to do things in the sky. And I just want to take, like, a moment to pause on that.

Eli: Yeah, and I think people don’t realize that, like, cell phone tower inspections is, like, one of the most dangerous jobs in America. OSHA called it…

Grant: OSHA declared it the number one most dangerous job.

Eli: …the most dangerous job. And that’s going to be…

Sonal: Really?

Eli: Yes.

Sonal: Why?

Jonathan: Yeah.

Sonal: Just because it’s so high up?

Jonathan: There were 14 deaths in 2013 alone from tower climbing.

Eli: So, and there’s not that many…

Sonal: Wow.

Eli: …people who climb towers, right? So this is a fairly high percentage of the people who do this for a living. These are high towers and people fall, or something goes wrong.

Jonathan: And that’s one that’s gotten a lot of publicity recently. There’s a lot of other jobs that are really dangerous as well. For two story steep rooftop inspections of residential properties, whether it’s during the underwriting phase, whether it’s during the claims phase — can also be a pretty dangerous job as well. And many companies — it’s, kind of, an opt-in job. They don’t just assign it to you, you have to, kind of, ask to be that person climbing up on the roof.

Sonal: Oh, really? Because it’s that dangerous?

Grant: It’s that dangerous, yeah.

Sonal: Wow, so there’s clearly a lot of dangerous cases. What are some of the — I mean, oil and gas, that’s what I hear about all the time as an industry that needs drones. Like, why is that?

Jonathan: Flare stack inspections for both onshore and offshore infrastructure in oil and gas. Also, oil derricks need to be inspected, and oil platforms need to be inspected for corrosion and damage on a regular basis. And a lot of these inspections, similarly, are very dangerous to do. Or, with the case of flair stacks, often the infrastructure needs to be shut down so that people can actually climb up on it. But with a drone in an aerial perspective, it gives you a completely different way to assess the status of the infrastructure without having to shut down critical equipment.

Practical uses for drones

Sonal: So we’ve, kind of, outlined some of the more dangerous jobs and use cases that drones can help address. Now let’s think about some of the things that there are opportunities you wouldn’t have had if it weren’t for drones. Because when we talk about all those application use cases — insurance, agriculture, etc. — in a lot of ways, we’re talking about disintermediating existing alternate approaches that are expensive, or prohibitive, or difficult, or unsafe. Like, having to do ladders, or oil and gas inspection. Things that are just impossible. I think it’s especially interesting on the creative side, like, what you can do with photography, aerial Hollywood filmmaking, and some of the really creative aspects of this. Because to me, the internet wasn’t just a commercial platform, it was a creativity platform. And I’m curious to hear what you guys are seeing on that front as well.

Samuel: I’d just say, first of all, that that qualitative part gets missed in, like, FAA cost-benefit analyses, you know? So, how do you put a price on a vista that you haven’t seen before, right?

Sonal: Exactly. Especially when you don’t know what it’s going to look like, because that’s the whole point of — again, not to be platitudish, but that’s the whole point of innovation. Like, it’s supposed to surprise you in terms of what’s possible. We can list all the use cases we want in this room, but we truly have no concept until we see companies and people start really inventing things around it.

Grant: Well, yeah. I was actually going to say on the creative side, one of the things that I think is some of the most interesting stuff is on filming — just being able to do shots that used to require helicopters, that used to require, you know, tremendous amounts of coordination, and time, and money. And now it’s just, like, you know, a drone just allows that so easily. So, kind of, the entry-level for what used to be a helicopter shot is, like, nothing now.

Jonathan: Well, and whether it’s in Hollywood and taking shots that were previously from manned helicopters, or whether it’s the utilities industry, you know, getting high-resolution photos of power lines from what used to be manned helicopters — that’s the starting point. But then it gets really interesting when you start understanding what wasn’t even possible with manned helicopters, and now is becoming possible with small aircraft — including, you know, new shots in Hollywood that previously — you know, you can’t get a helicopter within 5 and 10 feet of a person and, kind of, circle that person. But you can do that with a drone, especially as these things are becoming smaller, safer, lighter-weight.

Grant: Right, or even shots that transition from inside to outside.

Samuel: Passing through windows and so on. I’m no Hollywood expert, but I imagine in the past that they’d do a shot that pulls into the window, and then there’d be some hidden cut, and then reset the shot from inside. Now you could presumably just open the window.

Jonathan: The corollary for a lot of these industrial inspections is the ability to do things like fly underneath a bridge, fly underneath an oil derrick. The top side of some of this infrastructure was always accessible with manned helicopters, albeit at a very expensive price tag. But now you can go inside of buildings, inside of — I mean, we’re seeing companies do inspections of the insides of everything from, you know, large oil containers to even large gas turbines.

Eli: What’s interesting to me about the Hollywood application is that they actually were some of the earliest adopters, and they adopted it even before it was legal for them to do so. So Hollywood is, like, the…

Sonal: Follows its own rules, goddamnit.

Eli: Hollywood was, like, the Uber of drones and, sort of, like, they were just going to do it and ask for forgiveness and not permission. So, that was one thing I think, yeah, Hollywood helped with the drone policy.

Grant: Yeah, well, and also Hollywood actually helped a lot on the 333 exemptions. Right, because they, kind of, had some of the biggest immediate incentive to get commercial use approved. And also, what I thought was, kind of, cool is, you know, they paved the way for the use of drones in filming, because they already had all of the safety procedures, and flight manuals, and things that they had been using for manned helicopter shoots for years. So, they literally just took those and shifted them over and, you know, called it, “This is the manual for shooting with drones.” And that’s what, kind of, lets you get the 333 exemptions for shooting so easily now.

Samuel: So, we discussed some of the innovation arbitrage around drones. When it comes to Canada, some of that was also film, because there’s film industries in Toronto and Vancouver. And they could make shots and not have to worry about asking for forgiveness.

Sonal: So it’s interesting you reference innovation arbitrage, because the example you shared is basically — and this goes to what Jonathan was saying earlier about some of the innovation happening around the world — is that when certain places have more regulatory flexibility, it then draws that industry correspondingly. And I think the reason this causes U.S. lawmakers to freak out a little bit when they hear, you know, Amazon saying, “Hey, we might start developing drones in Brazil or another country,” it actually becomes correlated to a direct loss of the economic opportunities that are provided as a result of this. 

I mean, I’m thinking of the internet example. It’d literally be like saying, “You know what? We’re not gonna let commercial applications happen on the internet. So let’s develop them in China, and India, and Brazil, and South Africa.” Yeah, I’m just listing the bricks right there. But that is, kind of, the risk, to me, at stake here when we talk about this. Because I think, again, people are really underestimating how much is possible in the air. I don’t mean to be cheesy, but drones excite the fuck out of me because — and no, they really do — because it’s insane to me that, you know, we talk about men, women, humankind wanting to, like, fly. And now we’re talking about a whole new level of excitement, to be able to reach into the air and do things. I mean, don’t people get that, like, this is a really big deal for God’s sake?

Samuel: Adam Thierer from Mercatus Institute and I have a paper forthcoming called Global Innovation Arbitrage, and drones are a major case study that we look at.

Sonal: Why’d you guys pick drones?

Samuel: Well, we picked, you know, drones, we picked genetics. So, there’s these big things where, first of all, they’re major emerging tech, and they’re very much in the news. I picked drones personally, because, as a Canadian, seeing drones in the industry take off in my home country. And so, we actually focused on Canada and Switzerland. And the Swiss government has taken a very risk-based approach to drone regulation.

Sonal: So, is that a bad thing or a good thing?

Samuel: A good thing.

Sonal: What do you mean by risk-based?

Samuel: A good thing.

Eli: They’re actually evaluating the risks and moving forward accordingly, as opposed to just blanket bans or…

Samuel: And it’s flexible for that reason. So there are very few — for example, in Switzerland, there are very few bright-line restrictions on what you can or cannot do. They’ll have guidelines about, for example, going beyond line of sight. But those aren’t written in stone, such that if new technology makes that safer, that they can’t be revised, sort of, on the spot.

Sonal: Right, because the current law, if I’m not mistaken — at least locally, I know that you do have to keep drones within your visual line of sight. And that, sort of, seems to defeat the purpose, that the very purpose in certain use cases, like, if you’re a farmer mapping your fields is to be able to go beyond the line of sight.

Samuel: So when I reached out to the Swiss government on this — and this is another analogy of the early internet. I was really asking them for an estimate of how much commercial operation is going on in their country. And the reply I got back was, “We’re not the United States. We don’t keep a tab on every single commercial entity.” So…

Sonal: That’s fascinating.

Samuel: And, sort of, like, the early internet, you could look up every website in, like, a phone book, right? That’s, sort of, the mentality that still exists in the U.S. with drones and the Swiss and the Canadians. They’re comfortable not knowing exactly how many commercial operators there are.

Sonal: Right, and in fact, isn’t part of the problem — I mean, in the current state — that the regulation process can be prohibitive? I mean, the registration could be really expensive for small operators. I don’t know enough about it — like, what’s…

Eli: Well, there is a consumer registry now. And that registry, it’s not expensive — it’s five dollars — but it could potentially stop people from taking that step. There’s, I think, a lot of lawbreaking going on right now, because I think there’s something, like, a million-plus consumer drones, and only 400,000 have registered.

Sonal: Are registered, right?

Eli: So, we’ve created a new law that has turned us all into a nation of lawbreakers. But then the other thing is this isn’t — the registry is not very well-tailored to the actual risks that we face. You have to register a drone if it’s more than 250 grams, which the FAA helpfully put that…

Sonal: Which, by the way, how much is that in pounds?

Grant: Well, the FAA…

Samuel: 0.55.

Eli: This is two sticks of butter, is what the FAA says.

Sonal: Oh, really?

Eli: That’s the way, yes.

Sonal: Oh my God.

Eli: So two sticks of butter or bigger you have to — so it’s, like, half a pound, well, 0.55 pounds.

Sonal: It’s insane.

Eli: If it’s that big, you have to register it, right? And one of the things that we’re looking at is how dangerous is it, you know, to have a more flexible standard that goes up to, like, 2 kilograms, which is what’s used in a lot of other countries.

Sonal: How much of that in pounds, 2 kilograms?

Eli: 4.4 pounds.

Sonal: And so this is not even — this is just the weight of the drones themselves.

Eli: Of the drones, yeah.

Safety concerns

Sonal: It’s not including any, kind of, payload, like, for commercial applications when you’re doing delivery. <crosstalk> It counts the payload, okay. So, let’s take a step back for a moment and just talk about the safety implications of drones. Because what’s different, obviously, with the internet, and drones, and any airspace objects is that they are flying — we call them flying smartphones or flying computers, we think of them that way. But they are flying objects that can fall out of the sky, like, hit your head, they can get in your tree, they could kill your cat. I mean, I don’t mean to be frivolous about it, but these are realities. So, let’s talk about the safety implications of drones. And what are some of the concerns that people have, and that you guys who are really involved in this space have heard?

Eli: Well, I think there’s two things that people are worried about, and one is, as you say, falling out of the sky, hitting people on the head. And to me, that is something that we can properly deal with through the tort system. Just in the same way — if you hit somebody with your car, like, they sue you. Maybe the insurance company…

Jonathan: It’s a great example. It’s an example, though, that requires liability insurance to drive on public roads, and that requires registration of your car. So, I might be the odd person out here, but in the same way that you more or less have to have a MAC address to get on the internet, there should be some mechanisms by which we identify the other people who are flying drones near us, or flying drones. I was having dinner about a year ago, actually, in Berkeley, and a drone flew right into the side of the restaurant, crashed, and then just about fell on top of the head of this girl who was standing there. So, you know, I think it is an…

Eli: There’s a lot of people out there doing dumb things with drones.

Jonathan: There are some people doing dumb things. And I think we can keep the registration requirements and things like this very, very basic, and easy…

Sonal: Lightweight, yeah.

Jonathan: …and lightweight, but structured in a way where, you know, the person has an incentive. If there’s some identifying marking on that drone that’s going to say whose drone it is, people are going to be incentivized and maybe think twice before they, you know, fly their drone into the side of the building or, you know, above New York City and into a skyscraper.

Sonal: So, you’re saying associate some, sort of, identity or location.

Jonathan: That’s the idea behind registration, is that if you’re flying this drone, especially in a public space, and something goes wrong, people will be able to identify whose drone it is.

Eli: But then is it really 250 grams that’s the right threshold for that? I mean, I’m not worried about a 250-gram drone.

Sonal: Two sticks of butter falling on your head, I hate to tell you, nothing’s gonna happen.

Eli: Two sticks of butter falling on my head, I’m not too worried about that, personally.

Jonathan: I think that that 250-gram allowance could be called the paper airplane allowance.

Eli: Right. Well, because actually under federal statute, paper airplanes are aircraft.

Sonal: Wait, are you serious?

Eli: Yes, yes.

Jonathan: Yes.

Eli: So paper…

Sonal: What?

Eli: …airplanes are… The FAA…

Sonal: So every time a kid, like, folds up a paper airplane in the classroom in kindergarten, they’re, like, breaking the law? Or they’re not registered?

Eli: The FAA is forbearing on enforcing standards…

Samuel: Sort of discretion.

Eli: …the registration standards on paper airplanes.

Sonal: Oh my God.

Eli: So, the FAA would say that they have the right to regulate that. I mean, they would be embarrassed to say it, but they would say that they do.

Sonal: So, Grant, when you guys, you know, started thinking about this, like, thinking far ahead about, like, okay, the same way the internet needed, like, security — and airspace will need security, in this way where you can essentially enforce, so to speak, the anti-drone —what were the scenarios that were coming in you guys’ minds that you came up with this?

Grant: Yeah, well, I mean, it’s kind of interesting, too, because when we first started working on this and thinking about this, you know, it was still pretty early in the space, and we weren’t really seeing drone incidents occurring. You know, whereas now it’s, like, literally one a week, if not more. But I think to me, the big difference is that there’s, kind of, a gap in airspace enforcement, right? Like, if you’re talking about commercial aviation, civil aviation — at some point your enforcement of airspace restrictions — there’s, kind of, two things that come into play. One, is just the barrier to entry to be involved in aviation at all, right? You know, the amount of training required, the amount of money required upfront with planes, and fuel, and all of that. But then, you know, in addition to that, it’s a question of, at the end of the day, there is an enforcement mechanism up there. You have your plane registered with who owns it. The FAA can come and just cite you, can take away your licenses, things like that. You know, they can track you down. They have transponder requirements. And also, you know, at some point, if you fly into restricted airspace, the National Guard will literally, you know, fly an F-16 up next to you and tell you to land.

Sonal: They shoot you down like, “Top Gun.” Sorry, I don’t mean to get all dramatic. It’s just…

Grant: Yeah, but, you know, the F-16 and the National Guard doesn’t really help when you have, you know, just a quadcopter flying somewhere, that’s not really an appropriate level of response. But, you know, the spread of drones on the consumer side really, kind of, brings in this level of — it, kind of, changes the rules in thinking about airspace security, facility security, things like that. You know, when we talk about how it redefines various ways that we think about things, you know, if you’re thinking about perimeter security of something like a power plant, like, a nuclear power plant or something — or a prison, for example — there’s a lot of assumptions we make in building a security perimeter about fences, right? But now that you have drones, you know, an 8-foot fence versus a 20-foot fence versus a 2-foot fence is pretty much equivalent. It doesn’t really matter. You know, you can fly your drone over and deliver your contraband, kind of, regardless of the height of the fence. So it, kind of, just breaks down a lot of our, like, traditional security models.

Sonal: And so you’re thinking about it more in the sense of how to — because I know there’s geofencing, where you can actually, like, fence in a region that a drone is, sort of, contained to fly, but you’re talking about when you can’t control the perimeter, so to speak, in military parlance.

Grant: Yeah. I mean, you know, the problem at the end of the day with something, like, geofences, right —which, obviously, totally necessary, totally a step in the right direction. But you’re trusting the device…

Sonal: The operator, right?

Grant: …you know, to essentially police itself. You know, you’re saying, “Drone, don’t fly here.” And it’s going to abide by your rules. And that’s really good for eliminating, kind of, the initial low-hanging fruit of the people that are going to follow the rules. But, you know, a really good case in point is literally anyone flying a drone right now within a 30-mile radius of Washington D.C., right? Right now, in order to do that, you need to essentially override those controls, because that 30-mile radius is a no-drone zone — which also, incidentally, is, kind of, confusing if you are an RC hobbyist who’s been living near D.C. for decades flying RC planes, but now because it’s a quad rotor instead of a traditional RC plane, now it’s not okay to fly there. It’s, kind of, a confusing set of rules.

Sonal: Right, so you’re thinking about the enforcement aspect. Well, I want to think about the other safety issue, or is that the — you were mentioning there’s another one.

Eli: So, the other one I was thinking of was collisions with planes in the air. It’s the one that — the manned planes. So, this is something Sam and I have done some research on, and we use as a, sort of, parallel phenomenon — planes hitting birds. So, there’s actually many orders of magnitudes more birds in the airspace than there are drones. And so, what sort of conclusions can we have? And the FAA actually has 25 years of data on, sort of, voluntarily-reported bird strikes. And so we looked through that.

Sonal: What’d you guys find?

Eli: Birds are pretty safe.

Sonal: Okay. Thank God, I love birds.

Eli: So, we do hit birds all the time. Sometimes they cause damage, sometimes they do cause injury or fatalities. But in the context of — just the massive, massive number of birds and all of the flights — manned flights that we have, it’s actually a very low rate at which they cause any threat to humans.

Sonal: And how does this play out with drones?

Eli: So what we think is that the evidence seems to show that for small, you know — one of the things we do is we look at individual drones versus swarms of drones, because birds, they fly in flocks. So we look at the subset of bird strikes where it’s just a single bird. And then we look at the species of the bird and assign it a weight based on the average mass of the species. And so, what we found is — we looked at the 2-kilogram thresholds, and so that’s what’s used in a number of countries.

Sonal: More than a stick of butter. Two sticks of butter.

Eli: More than a stick of butter. And that’s what’s used in a number of countries for the threshold for what can be unregulated. And for a 2-kilogram drone, I think we found that there might be a human injury once every 187 million years — continuous flight hours…

Jonathan: Continuous flight hours…

Sonal: Wow.

Jonathan: …of the drone.

Eli: …of the drone. And then if you look at commercial jets, it’s even smaller. I mean, I think I got — I think the last number that we got was 41 billion years of continuous operation. Which is, you know, 3 times the age of the universe. So pretty safe. I’m not very worried about, like, a 2-kilogram drone taking out a 737, or anything like that.

Sonal: Right, well, I think one of the funniest videos I’ve seen on the internet, and I’m sure you guys have all seen it, it’s this one that — it goes every viral every now and then, and there’s always a different version of it. Like, of an eagle battling a drone.

Eli: Yeah.

Jonathan: Eagle versus drone, kangaroo versus drone.

Eli: Yeah, spoiler alert.

Sonal: Oh, was it…what were some of the other animals?

Jonathan: Kangaroo wins.

Eli: Yeah, yeah, it’s a kangaroo.

Sonal: That’s great.

Eli: Yeah, I mean, we’ve learned about birds that they’re more territorial than a lot of us knew. I guess scientists knew this, but the rest of us didn’t realize how territorial birds are.

Privacy issues

Sonal: Right. Well, then the third category of safety that I think has come top of mind for a lot of people is privacy. So, one example this weekend I thought was really interesting is — the New York Times decided to fly and use drones to see the mass graves that were being unearthed, and they weren’t allowed to look at them. And I thought it was great. I saw that — oh, I think it was someone on Twitter, Jenna Wortham or someone said, “Hey, we sent in drones.” And I’m, like, “Yeah, that’s great.” And then I was thinking of the counterexample about it — an individual level, where you might have a star who wants her privacy, and she doesn’t need to be spied on by paparazzi. And they’re going to use drones, just like anything else. And so, what are some of your thoughts on that use case, and that concern?

Jonathan: I think this is a case where, you know, technology can really be a significant enabler. You know, 10, 15 years ago, you know, if you had asked everyone whether they were willing to carry around what’s essentially a GPS tracking device in their pocket, people would’ve thrown their arms in the air and said, “Absolutely not.”

Sonal: Totally.

Grant: But with a couple, you know, technology additions to your cell phone, and the allowing you to turn the GPS on and off, and delegate which programs have access to it, and when they have access to it, and opt in to allow 911 to have access to your GPS position.

Sonal: You feel safer.

Jonathan: People are quite comfortable. They actually are happy to have that on them. And now there’s a variety of different applications around, you know, enabling people to run by themselves and alert someone if their GPS position ever stops for five minutes or more.

Sonal: Parents use it to track their kids for safety.

Jonathan: Parents are using it to track their kids. So, all of that, I intend to just be, kind of, an example of — I think the same thing is playing out here with drone use. Which is to say, yes, this is a technology that could be used to invade people’s privacy. But with some basically, you know, technology controls on it, it can also add a tremendous amount of value to society, without invading people’s privacy. And so there are technology mechanisms to — if you have permission to fly over Property A, and Property A abuts Property B, it’s relatively easy to make sure that photos that are taken over Property B are immediately deleted, or are never taken at all. Or, photography is only taken over the property that you have permission to fly over.

Sonal: You can do a lot through technology.

Jonathan: You can, and you can have, you know, geofences that allow for you to only fly within the bounds of properties that you have permissions to fly, or Section 333 exemptions to fly over, with the permission of the property owner.

Sonal: Right, and besides technology, there [are] also existing laws that cover so much of this, like, the Peeping Tom case. Like, why do we need new law, when there’s already…

Eli: No, that’s right. I’ve heard policymakers say, “Well, what if this, like, goes up right next to my bathroom window and looks in?” And the answer is, there’s already a law against this. It’s probably a state or local law, and it would just be enforced in exactly the same way. So, there doesn’t need to be, I think, a drone-specific…

Sonal: Preemptive.

Eli: …rule for that.

Jonathan: And these types of laws should be technology-agnostic. It shouldn’t matter whether it’s binoculars used, or whether it’s a drone used, or a ladder.

Eli: That’s right.

Sonal: I like that idea — that it should be technology-agnostic.

Samuel: But in terms of how the law should evolve, as long as we’re treating drones as any other kind of airplane — I wouldn’t recommend this, but if a drone is trespassing over your property and you choose to shoot it down, it’s, like, treated as shooting down an airplane.

Eli: Shooting an airplane, which is, like, 25 years in jail, or something like that. I don’t actually know the penalty. But this is — so, don’t shoot down a drone right now. Don’t be the test case.

Sonal: Right.

Grant: Well, I guess, yeah. As far as [a] test case, I mean, that’s part of the question here — is that regulatory-wise, we don’t really know where we stand on that piece, right? You know, so far we have one piece of case law of — in Kentucky, apparently, you can shoot down a drone with a shotgun and you’re fine.

Eli: Well, the FAA I think has issued — they’ve preempted that, and they say, “This is a federal offense, and it is shooting down an airplane. And it’s the same.”

Jonathan: Yeah, it’s pretty clear, both from all of the, you know, past laws that exist and then right now, there’s language just to reinforce it in FAA Reauthorization Act of 2016 — just further clarifying the Federal Government and the FAA’s ability to preempt all state and local laws as it pertains to the national airspace.

New developments on the horizon

Sonal: Great. I’m just surprised it wasn’t Texas and it was Kentucky. So, what excites you guys? I mean, we’re talking about some of the — just to switch gears from the safety topic again, and go back to, like, what’s new and exciting. So talk to me about what’s interesting to you guys. You guys are on the forefront of watching the trends in this space. I want to hear what’s new and interesting.

Jonathan: I guess from our perspective, right now in the United States, we’re still at this stage where the military has been using drones. They’re using them every single day. You have millions of consumers, literally, who are using drones in many cases every single day. And the major commercial companies have yet to really step into the fray and move from testing of the technology, which is where most all of them are at today, to actually using it as the way they do things. For whether it’s, you know, the insurance industry underwriting claims, catastrophe response, or utility inspections, replacing climbing up towers, and manual flights with helicopters with drones. So, I think that’s the thing that’s most exciting to me, and something that I also expect we’re gonna see in the next 18 months — the commercial companies actually move forward with, you know, commercial drones and aerial data as a way of doing business.

Grant: I’m super excited about airspace integration, and about us getting to the point where we can actually have, you know, large quantities of commercial drones in the airspace, you know, kind of, interacting with commercial traffic. Routing correctly, and things like that. You know, and it’s the kind of thing where it’s going to take a concerted effort by a lot of different groups coming together. You know, you can’t have Amazon using drones, plotting their own paths, and Google using their drones and plotting their own independent paths, with no interchange of information between them. 

Like, the NASA UTM program is working on a lot of that stuff. And I’m super excited about that. You know, super excited about transponders on aircraft, you know, things being registered properly — you know, actually having accountability. And once we get to that point, where we’ve got integration, where we’ve got accountability — then that just, like, opens up the door to all these different uses. And being able to have a point where a company, you know, can sit down and say, “How can we use drones? Okay, this is a thing that would help us.” And then there’s just [an] unknown path to actually use them correctly. You know, right now we just have so much gray area left in that system. But once we get that cleared out, I think it’s going to be great.

Samuel: Yeah, I’m excited about the entertainment side. So, I follow some of the hobbyist goings-on around first-person view drone racing. And these are people who put on goggles and fly drones around tracks. And I think it’s just — I think we’re only a year or two out before this is broadcast on ESPN, because just — it’s some of the most exciting things to watch.

Grant: Oh my God, yeah.

Samuel: Oh, yeah.

Grant: Just, the few groups out there that have started doing drone racing and have really, kind of, tried to address how to make watching that exciting — they’ve done an amazing job. Like, watching Drone Racing League and a few of the others, like — it’s going to be super sweet. I also, I’ve been a little disappointed in drone racing, just because now that I’ve started watching these guys that are doing it now — these guys and girls — they’re already so good. I’ve already had to, like…

Sonal: You can’t keep up, Grant.

Grant: I can’t keep up. I’ve already dashed my dreams of becoming a professional drone racer, because clearly I’m not good enough even for this early stage of the sport.

Eli: And the other thing, going along with the drone racing, which is all first-person view — I mean, just imagine putting on, like, an Oculus Rift headset, and just taking a drone up, and looking out of the drone’s camera and just being…

Sonal: And being in the sky.

Eli: So, you get to, like — it’s, like, being a warg on “Game Of Thrones,” right? It’s, like, you get to experience flight as if you were a bird or, you know, I guess as if you were a drone. I think it’ll be, like, really fun.

Sonal: I love that. It’s like, the e-sports version, and now we have, like, drone sports — kind of, like, a different version of, like, digital sports, essentially.

Samuel: Right, and I’d love to participate, and I’d love to get in on that, but I live too close to the White House.

Eli: And then I think, pushing it forward a few years, why do these all have to be unmanned systems, right? Why can’t you have an autonomously piloted aircraft that carries a human, right? Why shouldn’t we get human pilots out of the cockpits, just as we’re getting them out of, you know, away from behind the steering wheel in cars? You know, you can imagine a world where robots are us flying around, and that’s way cheaper, and you don’t have to carry a pilot. You don’t have to pay a pilot. Maybe we could have air taxi systems that are economical again. Maybe just huge safety benefits. I think in general, aviation — something like three-quarters of all accidents are pilot error. In commercial aviation, I think it’s about half. And so, you know, safer. What can we do to redesign airspace? The FAA is working on [the] NextGen airspace system, where there is more machine-to-machine communication. And so, you can have better routing. Well, what does that look like when that gets adopted? And how does that improve?

Sonal: That was actually one of the interesting quick sidebars about Jonathan’s notion of identity, to urge some kind of registration tied to, like, an entity — what was interesting to me — what I immediately thought of — just, like, IP address and the internet. Like, you essentially can have all these drone nodes communicate with each other and route information as a result of that.

Eli: Yeah, and some of the plans are actually very similar to how the internet is structured, in terms of public key infrastructure and, sort of, using…

Sonal: Right, exactly, pack it.

Eli: …like, SSL certificates.

Sonal: Right, exactly. It’s super fascinating.

Jonathan: There’s just no need to reinvent all of this technology just because it’s being used with drones.

Eli: Yeah. And I would say the last thing that I’m excited about that’s in aviation generally, but it’s perhaps somewhat unrelated, is supersonic. Because we haven’t — we’ve had a complete ban on supersonic in the United States, over land anyway, since 1973. We haven’t had a commercial supersonic jet since the Concorde.

Sonal: And what does supersonic do for us besides make a loud boom?

Eli: You could go cross-country in two hours, right? So I could come from DC, fly in, record a podcast with you, and then fly home. Like, that day.

Sonal: It’s like the hyperloop of the sky.

Eli: Yeah, hyperloop of the sky.

Sonal: I love that. I’m, kind of, excited by the art aspects. And when I think about this in the context — when people think of swarming drones — I love drone swarms. I think it’s amazing to see this orchestration of multiple drones in the air. And people view it as a very menacing thing, but I think there’s something very artistic, and elegant, and beautiful about it. But the other thing that really excites me — when I think of movies. Like, you know, when they redid the first three “Star Wars” movies — which were just awful, for the record, as everyone probably in this room agrees — I love the visual, though, of the fact that you had all these aircraft in the sky, and that people could jump from one aircraft to another. And even in this movie, “The Fifth Element,” which is this really lame, fun movie, there’s this amazing scene of people literally doing the same kind of thing. Like, they’re in the air and there’s layers — not just, like, one layer, but there’s layers of aircraft in the air. And it just gives a sense of actually living your life in the clouds, you know, where you can actually have, like, cafés in the air. You can do things in the air. I know that sounds a little crazy, but to me, when I think of airspace, I just think it’s amazing to me that we can now build upwards in ways that we couldn’t before. Well, thank you, guys, for joining the “a16z Podcast.”

Jonathan: Thank you.

Eli: Thanks to you.

Grant: Thanks for having us.

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