Amazon wants to use drones by 2018. An Australian startup will do it by March

Last night, “60 Minutes” set off paroxysms of excitement, ridicule, and WTFing with the revelation, at the end of Charlie Rose’s interview with Jeff Bezos, that Amazon is planning to offer delivery-by-drone within five years. While Rose and CBS producers drooled on screen about the PR coup, which could be seen as the kick-off of Amazon’s lobbying efforts to get the Federal Aviation Authority to regulate in favor of commercial drones, no one took any time to note that an Australian startup had already announced plans to start (very limited) drone deliveries by March next year.

Back in October, PandoDaily broke the news that Zookal, a textbook rental startup based in Sydney, had helped form a joint venture called Flirtey to enable delivery by unmanned aerial vehicles. Australia was the first country in the world to allow private drone use, meaning it has a head start on the US, whose FAA won’t release rules on commercial drones until 2015. Taking advantage of that favorable regulatory environment, Zookal plans to start delivering textbooks on a “hyperlocal” basis in time for the first semester of the university year, which begins in March.

In the wake of Amazon’s announcement, I talked to Zookal founder and CEO Ahmed Haider about how plans are proceeding for his company’s drone program and the challenges that lie ahead.

PandoDaily: Can you tell me how well the drone program has been going for Zookal and how many deliveries so far?

Ahmed Haider: We’ve done numerous test deliveries with it, and they’ve been quite successful. But Flirtey’s also been approached by a number of other players. They’ll be announcing their partnerships in a little while, across different sectors, not just within textbooks – within the fast food category, within logistics, within clothing, et cetera.

So you haven’t got any regulatory troubles, no other barriers like that? As of March, you’ll have a service pretty much up and running?

Regulation is always hard. There’s strict rules you have to [work] within. Within those rules there’s areas that we can operate within, and we’re going to go do so. But building a fully commercial operation that can cover pretty much all of Australia, there’s a lot of technological challenges as well as regulatory challenges around that. Having said that we’re probably four or five years ahead of anyone in the US.

So what’s the pilot going to look like?

I suppose “hyperlocal” is probably the best terminology for it – delivering autonomous flight directly to the customer’s mobile phone using GPS, sonar, and laser rangefinder, but just within a hyperlocal region. So not necessarily being able to fly for a couple of hours at a time or go for a Sydney to Wollongong [route, a distance of 50 miles]. But anyone within a set radius of our distribution point will be getting their delivery within a two- to three-minute timeframe. But within that we won’t allow every single customer to do it. We’ll do a select number of customers that we’re going to just test the initial deployment in a commercial level and see what that looks like and how that operates and what the kinks are.

So what’s the set radius going to be?

Initially we’ll do about a 2km (1.24 miles) radius. The thing is, the concentration of the way universities work in Australia allows us to cover a strong set of customers. But within that we’ll select a number of customers to do that.

What sort of number are you thinking of?

It’s hard to say. We’ve got about six drones on order at the moment of varying sizes and shapes.

So are we talking tens, or hundreds, of deliveries within that first month?

It will be maybe in the tens, closer to the low hundreds.

What are the regulatory challenges that you’re finding?

The rules are quite varied in Australia. Australia was the first country to allow drones commercially pretty much in the world. But within that there’s certain safety regulations that they have, particularly around autonomous flight and having human capability over it, which takes out elements of the scaling that we see the benefit of. But we’re actively talking to CASA [Civil Aviation Safety Authority] around getting some of those hurdles and challenges done to get much further deployment. It’s really around building scale into the model, and we understand from their perspective that safety is the issue.

Can you tell me what you mean by scale? Do you mean the distance a drone can cover?

It’s more just having a human overseeing the process, whereas our goal is completely autonomous so that there’s no human interaction at all.

When you say human interaction, do you mean just standing there monitoring the app or making sure the package is firmly in place on the drone?

Yeah, exactly. Being able to [be] within the line of sight and making sure the delivery radius is within a certain area.

Could that mean a human staring at a monitor watching the flight path of a drone?

I’m not 100 percent sure, but it has to be within the line of eyesight. So that again restricts your radius within 1km or 2km.

How many test flights have you done?

We’ve probably done about 25 successful flights. The guys [at Flirtey] are full-time, constantly testing it, building everything from collision avoidance through to linking the app via GPS. But we’ve had a number of successful deliveries now, and we’re pretty confident with the way the technologies are at the moment.

Given your experience, how well do you think it’s going to work?

I think it’s going to be real interesting. I’m pretty confident that in the hyperlocal space it’s going to do tremendously well. The area it gets really exciting is when you start looking at long-range flights. When you can cover a whole range of different areas in a short period of time, all of a sudden you do start replacing the FedExes and the UPSes, and taking a lot of those vans right off the road. It really depends on different parcel weights and battery times et cetera.

What did you think about the Amazon news?

Amazon had to do it. They’ve spent the last 15 years building this logistical advantage over everyone else, the Walmarts and what not, and I think when they heard about the drone use they realized they could lose all that overnight.