Regulating the rise of the drones

Regulating the rise of the drones

Prime Minister Prayut Chan-o-cha controls a drone during an 'outdoor classroom' session at Government House. (File photo by Thanarak Khunton)
Prime Minister Prayut Chan-o-cha controls a drone during an 'outdoor classroom' session at Government House. (File photo by Thanarak Khunton)

The skies above us are becoming crowded.

According to PricewaterhouseCoopers, the market for commercial drones is expected to soar by more than 6,000% by the end of the decade.

From delivering mail order parcels and producing spectacular photography to monitoring crop yields and verifying insurance claims, the business use of drones -- or more accurately unmanned aerial vehicles (UAVs) -- is booming.

There is little doubt that the rapid and disruptive development of drone technology opens the way to what promises to be an immensely lucrative new industry. The PricewaterhouseCoopers study forecasts that the value of the global UAV business will have ballooned from about US$2 billion (70 billion baht) to $127 billion by 2020.

This fast growth of a sector that simply did not exist a few years ago raises several regulatory concerns, particularly around safety and security. For example, should drone operators be obliged to have pilot training? What implications are there for privacy? What laws are needed to ensure drones are safe? And how can this be enforced?

Law lag

At the National University of Singapore (NUS) Business School, my research focuses on the relationship between law and emerging technologies. It is common for the law to lag behind technology and the case of UAVs is no exception. This is, after all, a technology that simply did not exist a few years ago.

The challenge for national regulators is to manage the integration of drones into their limited low level airspace, while also allowing innovative companies to commercialise an evolving technology into a viable business and claim a slice of the UAV pie.

When we talk of regulation many people tend to equate it with restrictions -- being told what you cannot do. Hence regulation is popularly seen as something that suppresses rather than encourages the free thinking needed for innovation. But well thought through regulation can also help guide the innovative process, providing clarity and certainty for businesses about what they can and cannot do.

'Judicious balance'

This clarity is an important risk assessment consideration for investors. After all, no one wants to put money into a venture without being at least reasonably clear it will be allowed to get off the ground -- in this case, literally.

From a legal perspective, it comes down to striking the right "judicious balance" between regulation to ensure safety and personal security on the one hand; and, on the other, avoiding steps that could stifle entrepreneurship and thwart a promising industry.

Nonetheless as drone technology changes -- and changes rapidly -- new challenges will arise that will have to be addressed. The trend for drones becoming smaller, more capable, and more affordable shows no signs of slowing and will demand a robust regulatory framework in response.

To date most UAV-specific legislation has focused on direct safety concerns -- for example banning usage near to airports, where drones pose an obvious risk to aircraft safety. Few laws anywhere to date address drone usage as it relates to issues of privacy. Yet we can see now the direction that drone technology is heading.

More affordable

Technology means drones will be able to fly higher, deliver better images and hover for longer. They will also become smaller, easier to operate and therefore harder to detect. Crucially, on top of all this, they will be more affordable, meaning they will inevitably become more widespread. Already some drones can be bought for little more than $100.

The capabilities of future UAVs and their potential intrusiveness poses obvious privacy issues. There is little doubt that this will become more pressing and regulators will need to consider detailed rules to oversee the data collection uses that future drones will be capable of.

Regulations should also address the operation of drones, including standards of airworthiness, approval of operating manuals, operator insurance as well as minimum age and training of those operating the drone.

With a growing number of drones set to crowd the skies, registration and tracking of drones may also have to be considered.

Such measures are already under consideration in some countries, and those keen to be at the forefront of drone development would do well to catch up.

Clear priorities

As with any emerging industry, uncertainty over the regulatory framework regarding drones will hamper business development because developers and operators will be uncertain about what they can and cannot do.

Therefore, as commercial UAV usage becomes increasingly widespread, operators need detailed rules and guidelines, built around clear strategic priorities, in order to grow into a viable industry.

The rapid progress we see in the growth of drone technology is not something that sits comfortably with the cumbersome bureaucracy usually found in civil aviation bodies. They are used to rules that manage the movement of relatively small numbers of large, high capacity aircraft.

Nevertheless, any country looking to reap the benefits of drone technology -- and ward off its downsides -- needs to look seriously at having clear and well thought through drone regulations in place.

Those that do not, will likely get left behind.


Ter Kah Leng is an Associate Professor in the Department of Strategy & Policy at the National University of Singapore (NUS) Business School.

Ter Kah Leng

Associate Professor in the Department of Strategy & Policy at the National University of Singapore (NUS) Business School

Ter Kah Leng is an Associate Professor in the Department of Strategy & Policy at the National University of Singapore (NUS) Business School.

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