STAMFORD, Conn. – Production of drones for personal and commercial use is growing rapidly, with global market revenue expected to increase 34% to reach more than $6 billion in 2017 and grow to more than $11.2 billion by 2020, according to a new forecast from Gartner Inc.
While the civil markets (personal and commercial) have been wading through regulations by various governments, drones' popularity in these markets has not diminished. The overall drone market will see substantial growth, but the dynamics of the personal and commercial submarkets are very different, Gartner analysts said.
Personal drones will continue to increase in popularity as an affordable extension of consumers' smartphones for taking photographs and selfies and for other entertainment options. They can fly a short distance and time, typically no more than 3 miles and for one hour, with flight height constrained to within 1,600 feet. They weigh less than 4.5 pounds and are priced less than $5,000.
The market for commercial drones is much smaller, with a significantly higher average selling price in comparison with personal drones. With more countries solidifying their drone regulations, the market is beginning to stabilize, and companies are now buying drones to test and deploy in nearly every industry, including convenience stores such as 7-Eleven. Commercial drones normally have a higher payload, longer flight times and redundant sensors and flight controllers to make them safer. They are more specialized to a function, such as mapping, delivery or industrial inspection, so prices vary per these requirements.
"The commercial and personal drone markets are increasingly overlapping, as lower-priced personal devices are being used for commercial ventures," said Gerald Van Hoy, senior research analyst at Gartner. "Personal drone vendors are now aggressively trying to position themselves in the commercial market. Recent technological advances blur the lines, allowing personal drones to be used in many special-purpose applications such as surveillance, 3D mapping and modeling."
Delivery drones continue to capture the attention of the news media but will not be a major factor for several years, Gartner noted. The return on investment has not been proven either regarding the cost of the drone, operational costs and a single customer delivery.
"Delivery drones will be mired in logistical issues like the time needed to return a drone to its origin point after delivery, and will amount to less than 1% of the commercial market by 2020," Van Hoy said. "We expect that delivery drones will begin finding a niche in business-to-business applications first, particularly for internal services within one company where logistics will not be such a big factor."