Tyler Suiters  0:11 

Hey everybody, I'm Tyler Suiters with the Consumer Technology Association. We own and we produce CES, the largest, the most influential tech event on the planet. We are here today to help you get CES ready. The big show is coming up January 8-11, 2019, in Las Vegas. And today we are addressing drones.

Tyler Suiters  0:36 

This is an emerging technology that is already changing our lives for the better. It can be the quick delivery of supplies and medicine in the wake of disaster or to remote areas. They can help with better crop production and more efficient food production as well. And of course, the benefits of safer infrastructure, inspection and maintenance, keeping human workers safe on the ground while drones do the tough work way, way above the ground floor. A little perspective on how popular drones are here in the U.S. CTA research forecasts drone sales of roughly 3.4 million units in 2018. That's almost 10% growth since just a year ago, and more than $1 billion in revenue just here in the U.S. So today, two perspectives on the drone sector: one from the public sector, one from the private sector. We are talking to the Federal Aviation Administration about the government's approach to realizing and, of course, bringing to life the benefits of drones within a government structure, and then a market leader on drones about the potential they hold, the challenges to getting the most out of drones, and how we can reach the full potential the drones offer to improve our lives. That's coming up on this edition of CES Tech Talk.

 

Tyler Suiters  2:02

It is an honor to have with us today the Acting Administrator of the Federal Aviation Administration Dan Elwell. Thank you for coming across the river to CTA headquarters and joining us today.

 

Dan Elwell  2:13 

Thanks for having me. It's a pleasure.

 

Tyler Suiters  2:14 

It's wonderful to have someone who is not only so proficient in policy, but also a pilot yourself, which is a unique perspective. With that in mind, let's start with something of a wide view here. And how the FAA’s policies shaped drone technology moving forward. I think for those who are uninitiated, they may not know exactly how much influence this policy body has.

 

Dan Elwell  2:39 

Well, the drone community is credibly fast growing and it involves a lot, as you know, technical innovation. Innovation is one of Secretary Chao’s top priorities. As it is mine, of course. And our policy philosophy is bent toward allowing innovation to thrive, and allowing innovation to compliment safety. Sometimes you hear the two compared as almost mutually exclusive. You can't bring in new technology initially without compromising safety. And I don't think that's the case.

 

Dan Elwell  3:21 

So what we're trying to create is an environment where we lay out the performance we want, and we let industry innovate to get to that place. And so what I've said many times to many of your members, and particular to the drone community is, you know, we want your innovation, we want your partnership in making the drone space as safe as possible. Bring us your safety solutions, you know how safely we are, so bring us your safety solutions. Bring us your technological advancements so that we can incorporate them in future policy decisions and our regulatory framework.

 

Tyler Suiters    4:05

Interesting. So building on that, that that bedrock of a balance of innovation and safety. What is your vision for the widest use of drones? The possibilities, I say, seem limitless. I don't mean that literally. But we're discovering new uses and new ways that the drones can change our lives for the better, seemingly by the month.

 

Dan Elwell  4:26 

Well, it does seem by the month that they're coming up with new applications. I would -- I don't have a problem saying that the possibilities are endless. Because every time I think I've seen the full scope of what drones can do, I'm surprised by some new application. So I don't have a vision of the widest use of drones, because I really do think that as soon as you try to pin in or define what drones can do something, new going is going to hit the market. My vision is to create, again back to the policy back to the regulatory framework, to have in place and create a regulatory framework that allows for the widest use, whatever that may be.

 

Tyler Suiters    5:21 

So let's drill down into that a little bit. Because whatever those future uses our drones, an acronym that we know very well in this policy community, BLOS -- and we love our acronyms in Washington, D.C. -- but beyond line of sight is integral to so many of these applications. Could you delve in a bit, Mr. Administrator, into what that means for drones? Why BLOS is so critical?

 

Dan Elwell  5:45 

So you said your audience knows what it is. I won’t define what BLOS means. But it is so important, because until we have the ability to approve wide scale, beyond visual line of sight operations, the industry is by definition limited to as far as the pilot of the drone can see, which obviously is incredibly self-limiting there. So the unique and interesting thing about beyond visual line of sight, dilemma or conundrum, is all of the things you have to solve -- all of these problems you have to solve to get there. You have to solve loss of signal.

 

Dan Elwell  6:35 

What does the vehicle do? If the operator can't see it visually? What does the vehicle do when it loses signal with its operator? How does the operator know that the vehicle is no longer responding to its commands? How does the aircraft or the vehicle separate itself from collision with other stakeholders or fixed objects? You know, all of these things, traffic confliction, following the right protocols when emergencies or contingencies happen. These are all issues that have to be solved. And of course, much of that is solved with a UAS Traffic Management Protocol, or some form of remote identification.

 

Tyler Suiters    7:27 

So when do you envision something like that coming into reality traffic management system for these unmanned flights?

 

Dan Elwell  7:35 

So it's hard to nail down when we'll have a system in place, because the system that we're working toward is an integrated system, not a separate system. I think, if it were its own, you know, we were going we're going to have a separate traffic management system for us and a separate distinct traffic management system for manned flight -- but we're not working toward that, and the industry doesn't want us to. And I think for the purposes of the growth of this industry, and ultimately, for the safety of the National Airspace System as a whole, they need to be integrated. That's why we, and the president has initiated the UAS integration pilot program that we're about a year into. And the IPP, as we call it, is designed specifically to flesh out what we need to do and how close we are to affecting some of these important infrastructure entities like UAS traffic management, or UAS integration. Small UAS, of course at first, which is what we're working on.

 

Tyler Suiters  8:42 

If we could dive into the IPP, just for a moment, Mr. Administrator. That echoes earlier federal drone programs, in that using locations across the country, this isn't just a D.C.-based system. This is integrating in different capacities with the private sector in different conditions under different opportunities, correct?

 

Dan Elwell  9:01 

Yeah, the presidential directive for the IPP was to have at least five applicants approved that represented diversity and geography and climate and operations. The only thing that had to be run throughout all the applications and all of the eventual location awardees is that the primary applicant had to be either a state locality or tribal government, and a partnership with the drone community. There were also a number of other criteria: there had to be collaboration with the local community and buy-in by the local community, including law enforcement. We gave preferential consideration to applications that dealt with law enforcement and counter UAS or applications that sought to experiment with traffic management ideas.

 

Dan Elwell  9:56 

So we had such an enthusiastic response to the program, that instead of granting five, we granted 10 applications. And they do, in my opinion, fully represent the gamut of operations. And some of them are quite interesting. And again, things you never would have thought a drone would have been would have been a part of, like Zika virus mosquito control or controlling feral hog population. Things like that, you know.

 

Dan Elwell  10:41

We've said for decades, you know, it's the dull, dangerous and dirty jobs that drones will do. And that's certainly been something. But there's also the sexy jobs. Like there's package delivery and human relief jobs that only drones can do, or could do better than putting manned aviation in harm's way. We saw that one application I hope will be able to mature faster than others is fire spotting, firefighting, those kinds of applications. But the IPP has been a tremendous success, and we're looking forward to the next two years of the program together, even more data to answer some of these questions. But sort of, in parallel with the IPP, we have the UPP, which is the UAS traffic management pilot program, which we did in partnership with NASA. And we will very shortly name the recipients of the initial pilot program for those applicants for UTM, or UAS traffic management.

 

Tyler Suiters  11:47 

So when we're talking about the national applications, that also brings to mind economic impact, which is a remarkably dry phrase, I know. However, a very rich report came out within the last several years about potential for job creation, economic impact on a state-by-state basis as well as nationally. How important are drones to the U.S. economy, maybe not today but in the next decade or two decades or moving forward? I'm asking you to pull out the crystal ball once again, I know Mr. Administrator, but I'm curious where you see that end up.

 

Dan Elwell  12:21 

Well, the next decade of the drone market and what it means to the economy to the nation depends, kind of that question depends on who you ask. You know, folks who are excited and want to see this industry grow and succeed, like myself, see that it's possible that this industry could have an economic impact of upward of 82 billion annually in the U.S., 127 billion globally. We're talking about the possibility of 70,000 new jobs once integration starts. And this is through 2025 are the projections right now.

 

Tyler Suiters  13:05 

That's just U.S.

 

Dan Elwell  13:06 

And it's just U.S. That's just U.S. Now, to get there though, we have to answer a number of issues and concerns that folks maybe who aren't as excited about this new technology. Folks worried about noise. Folks worried about privacy. And of course, our number one priority is safety. Those are the things we have to address at the early stages to make sure that, as we allow this nascent industry to grow and come into the system, that we do so respectful of everybody's concerns, and primarily that we do it safe.

 

Tyler Suiters  13:50 

So you mentioned a few times the importance of public-private engagements, the government working with the tech industry itself. CES 2019 will be a great touch point, obviously, for you to get face to face and work closely and talk to industry. What does the FAA have planned for Las Vegas in another month or so?

 

Dan Elwell  14:11 

Well, the worst part is I can’t go this year. And I had such a good time last year.
 

Tyler Suiters    14:19

It’s love in January compared to D.C., I promise.
 

Dan Elwell  14:21

Yeah, and it's a tremendous show. And my congratulations to you and Gary Shapiro and the entire CES family, because it is it is a phenomenal show. Our team will be on site this year, or I guess next year, working to answer your questions in person and online. And we will have two booths at CES, one for drones and one for PackSafe. And we had that at the last CES. It's about lithium battery storage and the proper way of carrying them. And you can follow us live throughout CES on Twitter @FAA news and Instagram @FAA. And, as always, on the FAA’s Facebook account. We’ll answer your questions 24 hours a day, seven days a week online.

New this year is, if you're a pilot and you're at CES, stop by the drone booth if you have any questions, and we'll talk to you about how to apply for your remote pilot certificate. And of course the highlight for us, and I hope for you, is that DOT Secretary Elaine Chao will be there. And she'll have, as always, some really important things to convey to the group.

 

Tyler Suiters  15:35 

Yes, second straight year we get to host Secretary Chao. We are very much looking forward to that. You mentioned pilot registration, Mr. Administrator. I don't think we can say it enough, that whether you're a commercial or just a casual pilot, there's some very simple rules you must follow the fly safely.

 

Dan Elwell  15:53 

Absolutely. And that's one of the reasons we've pushed so hard that if you're going to be a drone pilot, be a drone pilot and emphasis on the word “pilot,” because it is an aerospace vehicle. And we want to make sure that everybody who is putting a vehicle in the National Airspace System knows the rules of the road. And they're not that difficult. And when you go online and you register your drone and then you subsequently get your drone pilot certificate, the things you learn, quite literally, could save lives. So why wouldn't you do it? You wouldn't get on the road in a car without some sort of training. Why would you put a drone in the air without knowing exactly what you're doing.

 

Tyler Suiters  16:38 

Dan Elwell is Acting Administrator of the FAA, and Mr. Administrator, thank you for your time. And again, your enthusiasm as a former pilot certainly shows through. We appreciate it.

 

Dan Elwell  16:47 

My pleasure. Thanks for having me.

 

Tyler Suiters  16:52 

Brendan Schulman is with DJI, a globally known innovator in the drone sector. He is vice president of policy and legal affairs there. Brandon, good to talk to you again.

 

Brandon Schulman  17:03 

Great to be here.

 

Tyler Suiters  17:04 

Very exciting time for the drone sector. I think I would have said the same thing at any point in time over the last four to five years, right? The innovation keeps coming. The sector keeps growing at such a rapid pace. Let's just dive in. What has your attention right now? What has you especially excited?

 

Brandon Schulman  17:21 

Well, I'm really excited about the ways that we're seeing drones being used, not just in commercial and consumer applications, but in public safety. So for the past couple years, we've been tracking news reports of people who've been rescued or the live saves using drones, like the ones that we make. And we're now nearing 200 people who've been saved from peril in situations like flooding, missing persons who were found using the drone, and even some cases being delivered life preservers while in distress in the ocean. So we're amazing to see the public safety benefits coming through now that we're at this stage in the industry.

 

Tyler Suiters  18:05 

You know, that brings up a great point, Brenda, because drones are one of these innovative technologies, this disruptive technology, that can be applied to real-life situations and provide solutions so quickly and immediately. And I think, you know, you share the numbers of live saved, I think it's probably impossible to talk about the number of lives affected for the better after disaster, whether that's hurricane or earthquake or avalanche, what have you, when traditional means of getting supplies or medical needs or even food to these isolated areas is impossible because roads are impassable. Yet drones are doing that job already.

 

Brandon Schulman  18:46 

Yes, and we have a really recent example of that. Although it's not delivery, it's in the world of information. So immediately after the Camp Fire in the Paradise, California, area, we had a group of people go out and use drones to very quickly map a huge portion of the impacted properties there to determine where to look for people who might still be there.

 

Brandon Schulman   19:15 

What the extent of the damages, support on filing insurance claims. They're able to turn around a huge volume of data, put it up under the Sheriff's Department website as an interactive resource, including a map, panorama 360-degree imagery and videos so that people who were not permitted to go back yet and check on their homes could actually see within a matter of days the state of their property. So we're seeing drones being used in emergency response and disaster recovery.

 

Tyler Suiters  19:47 

Yeah, remarkable that you could do something that logistically challenging so quickly and deliver those results. You know, a less publicly-facing series of benefits I think comes in the industrial and commercial sectors, right, across energy, across transportation, agriculture as well. Would you dive a little bit into those, Brendan, in terms of the benefits that that you're seeing that this technology is able to engender across so many different sectors that maybe aren't traditional technology sectors.

 

Brandon Schulman   20:22 

Yeah, there is. And I think there are two benefits to that. And they're really significant, both safety and efficiency. So any way in which you can position a sensor, usually a camera, in three dimensions is a useful tool. And that, for example, in the roofing industry, if you can get up there and do an inspection of a roof, whether it's storm damage, or just general maintenance, and do it in minutes without even climbing on the roof. Because you're able to position a drone camera and three dimensions, take high-resolution imagery, or in some cases do a thermal scan to see whether there is a heat loss coming out of the roof. You're then able to better assess the condition of the roof, the volume of materials you might need to repair or replace it by taking measurements, and do much more in that period of time. And you haven't gone on the roof to do it. So whether it's a roof structure or power lines. We had a story come to us recently of a power company that was using a drone to restring power lines across a valley after one of the hurricanes last year. So a really powerful and efficient way of doing something that would have taken a lot more time and would have put those workers at greater peril.

Brandon Schulman   21:46

So you really can't count those benefits, but just the way in which drones are being used. And just to give another really unusual example, really one of my favorites, is a research institution that's using drones to collect whale snot. Literally fly a drone right behind and above a whale to collect the spray that emerges when the whale blows its spout. And that allows the researchers to understand the gender of the whale, whether it's pregnant, whether it's healthy, migratory patterns, and really, you know, save the whales in a way that could never be done before because you never collect that kind of sample with a boat. And you certainly wouldn't want to fly a full-scale helicopter that close to an endangered animal. So really innovative applications are just starting to emerge.

 

Tyler Suiters  22:37 

Yeah, in unrelated news, #whalesnot is now trending, we're getting word.

 

Brandan Schulman 22:43 

I love it.

 

Tyler Suiters  22:44 

As far as the technology, Brendan, let's talk about those innovations, specifically how drones themselves are becoming -- well, what comes to mind most quickly, is becoming more capable of doing more things. What's at the forefront there for you and for DJI?

 

Brandon Schulman   23:02 

So one of the latest innovations we've done is released the Mavic 2 Enterprise drone. That's where we took our Mavic platform, which has been out for a couple years now, and upgraded it in a way to add capabilities that we did not have before. So you can attach a loudspeaker to the Mavic 2 Enterprise. And what that allows people to do, particularly public safety officials, is to communicate at a long distance verbally. So in the case of a rescue situation, you can provide instructions to somebody that you otherwise would have no ability to communicate with.

Brandon Schulman   23:40

We also have an attachment for that drone that's a spotlight for operations at night to illuminate a dark area. And that can help with everything from emergency response to facility inspection to nighttime photography and cinematography. So that particular off-the-shelf drone is a good example of how additional features are being added to enable complex operations.

Brandon Schulman   24:06

We also in the past year have added a payload SDK, so a software development kit that allows other companies to integrate their sensors, whether it's LIDAR or photography. Or, in one example of someone who had an air-monitoring device, able to send a sensor up into the atmosphere and sample the air for air quality, which is extremely important particularly, you know, in a wildfire situation. To do that on a drone and to integrate that sensor input into the drone system and provide live information to the ground is really powerful. So we're seeing the integration of more sensors and tools to enable those applications.

 

Tyler Suiters  24:45 

So there's a flip side to this, right, in terms of getting innovation into the public sector so quickly. And that is the need to balance innovation with safety. You are in the public policy and regulatory sector 24-seven, I know, Brendan. What are you seeing globally, in terms of the evolution of how, let's start at the grand scale: countries are balancing that, the needs for safety and the needs to innovate. And each country is in a race to some degree.

 

Brandon Schulman   25:14 

Safety is absolutely essential. And we've made it a company priority, stretching back years with all kinds of safety features in the drones, everything from geo fencing, to automatic return to home in the event of a radio signal loss or a battery condition, obstacle avoidance and the list goes on. We work hand in hand with government regulators around the world to try to figure out the policy solutions to safety and security and privacy concerns. These are all top of mind for me and the others that I work with in the industry. And we see good solutions coming out.

 

Brandon Schulman   25:52 

So one of the key ones, both in the United States and around the world is a call for a remote identification capability, namely the ability for people to know who's flying the drone and whether they're authorized to be where they're flying. And that's something that we support. We've actually kind of lead the way in terms of policy and technology development. And it makes a lot of sense. Just like a license plate on your car helps the authorities identify who you are in the event of an issue. Similarly, drones, to the extent they raise concerns, should also have an identification mechanism that is implemented in a way that is low cost and fair and makes sense for the technology. So we're glad to see efforts around the world to address those, and we think they're really a combination of smart public policy and technology solutions that work hand in hand.

 

Brandon Schulman  26:45 

So our internal research here at CTA tracks the U.S. tech sector sales and forecasts twice a year. And with each sector, the expected growth for the drones sector and in terms of purchasing here in the U.S. for consumer buys is escalating, right, higher and higher on an annual basis. Is there a particular area of that where you're seeing growth? Is it consumers as enthusiasts? Is it consumers as commercial operators? Do you break that down at all? Do you have a feel even for where that growth is coming primarily, or sector that surprises you, perhaps?

 

Brandon Schulman   27:26 

I'm not surprised to see the growth. This is something I've long anticipated, that once the capabilities were better known, everyone would figure out a way to put a drone to good use, whether it's for fun, or public safety or commercial or even the whale research that we talked about. So I think we're, you know, in the past two years, we've seen a ramp up in the commercial and enterprise applications. And that's really thanks to the FAA’s implementation of a regulatory framework that supports it, you know.

A couple years ago, you weren't supposed to fly commercially. Now you can, and the barrier to entry is really low. You just take a multiple-choice test, that like 91% of people pass on the first time. And then you can go and turn your drone enthusiasm into a business. So I think we see that crossover taking place of people getting into the technology as consumers, for fun or to do artistic endeavors, and then realizing, “hey, this is a really useful tool in a more commercial setting, in my business.” Maybe I'm a real estate agent. Maybe I'm a person who does facility inspection. And that's where I think a lot of the future growth is going to be.

 

Tyler Suiters  28:42 

So one proof point that I've seen, Brandon, regarding consumer and professional enthusiasm for the drone sector is how we see just the foot traffic at CES. In the drone section, right? More and more people making a point of going there during the show to see the latest innovations. DJI is veteran of CES, what are your strategies and your game plan going into 2019?

 

Brandon Schulman   29:07 

We really love being there. It's so exciting. And to see the drone space grow each year has been tremendous on a on a personal level as someone who's been a drone enthusiast for many, many years. I think we want to make sure people have a chance to see and experience the technology. That's why we have a flying cage there. Over the years we've had an actual hands-on flight experience. So there actually are two booths, one of which is a hands-on booth. So really want to try to bring that technology to all the attendees, who are always very enthusiastic. The crowd around our booth every year is always very thick and active. And we're also happy to have the FAA there, usually right across the aisle from us, so people can have their regulatory questions answered as well and make sure everyone is operating safely and enjoying the technology.

 

Tyler Suiters  30:02 

All right. Brandon Schulman is vice president of policy and legal affairs at DJI. An exciting time to be in the drone sector, no question about it. Brendan, great to talk to you again, my friend.

 

Brandon Schulman  30:13 

Thank you.

 

Tyler Suiters  30:15 

All right, coming up next time on CES Tech Talk virtual reality, VR. The killer app may still be to be determined. But there are some pretty amazing benefits that are on the way, including not just courtside seats to your favorite teams, but courtside seats, perhaps, for everyone who wants to attend even a single game.

 

Yoon Lee, SVP, Content & Services, Product Innovation, Samsung  30:39 

All those problems will go away if you have a virtual seat on the stage, using a VR where thousands of people could double-, quadruple-book and have a vantage point where not even the best seat at that concert could give you.

 

Tyler Suiters  30:57 

All right, that's coming up next time on CES Tech Talk. We are here to get you CES ready. And now a major step to prepping yourself for the show: download the CES App. You can build your personal agenda; you can sketch out your favorite exhibitors and speakers, and sync in real time across your devices. And new this year, you can connect your LinkedIn account, and that way you can see who among your other LinkedIn connections is also at CES. A great way to harness and leverage all that synergy that's created around the show. All right, CES 2019, January 8-11, in Las Vegas. More info, of course, is at CES.tech

 

Tyler Suiters  31:40 

A reminder, none of this is possible without the true stars of this podcast series. Our engineer John Lindsey, and our producer Tina Anthony, you all are the best in the business. I'm Tyler Suiters. We're glad you're with us. Let's talk tech again soon.

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