United States Drone Industry: Pestle Analysis

The political and legal environment is one of the most important aspect in the United States drone industry, that could either ban or allow these unmanned aerial vehicles (UAVs) or drones to fly all over the US. The US drones industry is now under control of The Federal Aviation Administration (FAA), which is an agency of the United states Department of Transportation. FAA has a full authority to manage regulation and oversee all aspect of American aviation. Drones have now been opened up for a non-commercial use with a few rules. Moreover, one types of the commercial use, which is the commercial production of TV programs and movies, has already been allowed to only 6 companies, whereas the rests of commercial drones are still banned. However, the FAA has lately been discussing about the possibility of drafting regulation for commercial drone flight within 2015. The discussion will be started with the limited flight of drones weighing below 55 pounds, which cover the majority of commercial drones in the market.

Nowadays, every industry has a very tense and competitive situation, while many companies are trying to be more competitive as well. Service and quality seem to be very important aspects for the competition; hence, many firms are trying to potentially increase their competitive advantages by adopting technologies to maximize their customers’ satisfaction. Drone becomes a potential alternative for companies’ logistics activities in order to increase their competitive advantages. Moreover, according to the United State Bureau of Labor Statistics, the national minimal wages in the US has continuously increased every year. It is very reasonable for many companies to substitute labor with drone technologies. The trend of using drones seems to be gradually increased for the next 10 years. Drones are usually used in both country military sector and also civilian purpose including commercial drones. From the previous time, almost 100% of drones were only used by military sector. However, proportion between defense drones and civilian drones tend to change continuously. BI intelligence claimed that by the end of 2023, 12% of all drones in the market will be civilian drones. This would be a result of the granted law through an upper house on the use of commercial drones.

The drones industry seems to have less social forces because most of the drone adoptions are in business to business industry. Drones are mostly use for military purpose or commercial purpose. However, the safety issue of US citizens is one of the top priorities to the US society. The commercial drones will definitely be used across the public areas, which will increase the chance of accident. Therefore, there are still a lot of criticism among public and government about the issues. As a result, research and development in this area still leaves a gap for the firms to solve. On the other hand, the ethical issue has also been questioning, whether privacy of people would be interrupted or not.

The availability of technological resources and infrastructure has introduced to this radical innovation of drone, which will lead to a new way of many activities, including military and commercial purpose. Although drones are not regularly allowed to fly across the US, there are a lot of feasibilities to incrementally develop the drones for other purposes. This technology is in the beginning development stage, but it has already shown some of its potential functions in military purpose, such as spying on foreign territories. For instance, in the film making industry, the use of drone has already been adopted by 6 private companies in 2014. Furthermore, a large source of human capital concerned technological expertise still exists in a labor market, in which it increases a feasible opportunity for drone-technological advancement. There are also a lot of cooperation between universities and private companies, which conduct a research based on a development of drones. For example, “Drone pilot school” in DeVry University and ITT Technical Institute is a technical school that provides job training programs. Drone technology will not only stop at this stage. Drone, for example, has been adopted to use in museum and university for historical or campus tour at the moment.

The only force on this environmental determinant is that the US local weather and climate. The US has a wide range of climate across the different parts of the country. The climate can be constructed from shower rain to heavy snow storm, which would definitely limit the use of drones. However, drones are still a very beginning stage of development, which there are still many feasibility studies about this aspect of development.

Overall, the economic and technology environment of the US has recently been supplied the trend of drone technology. This would be an easy path for most companies to enter and seek for the benefit in this business. However, many concerned points could be encountered by many companies as well in order to initially gain a competitive advantage.