business news in context, analysis with attitude

The Wall Street Journal reports that United Parcel Service (UPS) is saying that "it successfully used a drone to deliver medicine to an island near Boston, jumping into a race with competitors such as Inc. to test drone delivery inside the US ... UPS’s brown and white drone, which was emblazoned with its logo, took off from Beverly, Mass., carrying the 2-pound package. It flew 3 miles over water within line of sight to a nearby island, touching down in a patch of grass. The drone flew autonomously, without a human pilot, simulating an urgent medical delivery."

According to the story, "The delivery of an inhaler on Thursday was conducted in partnership with CyPhy Works, a drone maker in which UPS holds a stake. The delivery kicks off a wider test by UPS of using drones for commercial deliveries to remote or difficult-to-access areas."

The story goes on to say that "UPS’s delivery marks the first major commercial delivery conducted via drone in the US since the Federal Aviation Administration implemented long-awaited rules in late August authorizing businesses to start using small drones. The company previously has tested drone use for indoor warehouses and international disaster or human-aid relief, which aren’t subject to the same regulations. UPS is on the FAA’s drone advisory committee."

The Journal also notes that UPS has incentive to move to drones: "The company has higher labor costs than rival FedEx due to its unionized drivers, package sorters and other workers. Still, any wider scale use of unmanned technology to do those jobs likely would complicate the delivery giant’s relationship with the Teamsters labor union."
KC's View:
If eliminating labor costs is one of the best reasons for adopting drone delivery, then I think we can expect the US Postal Service (USPS) to start moving in this direction pretty soon. I wouldn't bet on it, though.

As for drone deliveries, I think we are getting to the point where we all have to start watching the skies. Because this is happening, and almost certainly a lot faster than most people (with the probably exception of Jeff Bezos) ever would've expected.