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Network and Services Technologies Fuel Personalization Push for Sports Venues
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- Published on 22 November 2022
(Source: Pixabay)
Data-driven decisions help operators optimize current and new processes to profile and monetize the fan.
At no other point in history have sports venues embraced advanced infrastructure to feed data on access, transactions, and social media use to analytics engines to help owners personalize the monetization of fans.
In the NFL, for example, the league provides venue owners tools for use with ticketing data, an important step in learning about fan trends. Combine this valuable information with data from transactions at the venues, and owners can build a detailed profile of fans.
Activities and interests that can be tracked on a per-fan basis are far more valuable than those that can only be measured as a large group. The former allows venue owners to pitch individual fans personalized offers – before, during, and after the game - for the life of the fan.
More technology in less time than B2B
Keeping pace with emerging and new technologies in this B2C vertical is arguably much tougher than in the B2B world. That is because sports venues such as those in the NFL have gone from no-frills oblongs to tech-infused mega-complexes in less than a decade. Implementing and upgrading to more advanced technologies, product iterations are often an annual event.
How did we get here?
IT and business leaders in the NFL began with team websites, followed starting a decade ago with first-generation, stadium-wide free Wi-Fi for fans seeking access to the Internet for scores, highlights, and to social media to share their experiences. Many NFL stadiums use Extreme Networks for the Wi-Fi and its analytics offering.
Expanding the stadium infrastructure
With the democratization of smartphones, cellular services from carriers could not keep up, initially, nor could early stadium Wi-Fi networks. Both have since advanced and have been deployed in several NFL stadiums now equipped with Wi-Fi version 6 (which helps with mobile ticketing). Add Distributed Antenna Systems (DAS), which are networks of antennas used to extend public cellular wireless network (such as Verizon 5G) coverage.
It is little surprise that backbone networks and the number of devices and apps they support are growing. For example, the Atlanta Falcons’ Mercedes Benz Stadium, completed in 2017, featured a Passive Optical Network (PON) made up of over 4,000 miles of fiber. It supports data transport to and from wireless access points, over 2,500 large IPTVs, security cameras, PoS systems, digital signage, and back-office systems.
Backbone networks and data centers in NFL stadiums are expanding to enable a fast-growing list of applications, including mobile ticketing, facial recognition, contact-less and cashier-less purchasing of concessions, and crowd management/control. Greater computing power is essential to draw crucial analytics from lakes of data.
Streamlining core processes: Concessions
Once an onerous and strictly manual process at NFL venues, a few venues added concession ordering to their smartphone stadium apps to address long lines during events.
Contactless payments
Today, many NFL teams have opted for an app-based, cloud-enabled system from SpotOn that allows attendees to order from anywhere in the stadium without leaving their seats. The POS system offers analytics to customers, which include pro and college sports venue operators, to help vendors with food and beverage planning and management.
The vendor counts the New York Giants, the Denver Broncos, and Philadelphia Eagles among its thirty-seven sports clients. Fans can get the food and drinks they want faster and easier, elevating their satisfaction and increasing the total amount spent per game, according to the vendor.
A checkout-free NFL first: Amazon’s Just Walk Out
When a fan visits District Market at the Seattle Seahawks Lumen Field this season, they can opt to insert their credit card at the entry gates or hover their palm over an Amazon One device to enter.
Amazon One is the vendor’s palm recognition technology and payment service that consumers can sign up for at kiosks outside the stadium stores or at the company’s owned businesses such as Whole Foods supermarkets.
Users visit a kiosk or a point-of-sale station at participating locations to link their palm and payment card to the service. Then, all they must do during the checkout process is hover their hand over a scanner to complete the transaction.
Facial recogniition use expanding
And while facial recognition is widely used in law enforcement, sports venues are deploying the systems for access control first and for concession sales, crowd control, and analytics later this season.
The Cleveland Browns operator chose Wicket Software to provide its facial recognition ticketing system, which the team installed in 2020. It is an opt-in offering whereby fans upload a selfie, and their ticket info to an app before Wicket's computer vision sensors verify their identity as they enter designated gates.
The team plans to expand its use of the Wicket system to handle payments for concessions and age verification for alcohol purchases. What aids the system use is the fact that 90% of fans coming to Browns games come to every game, according to the team. The Atlanta Falcons also use wicket software.
Verizon hopes to sell venues a solution that combines Wicket software with its 5G service to accelerate processes in venues deploying facial recognition for use in core operations such as concession sales.
The bottom line
Technology pioneers take their share of arrows. Those that follow later, however, can often learn from the challenges and victories of early adopters.
Related articles:
What to Expect When You’re Expecting Rural Broadband
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- Published on 07 November 2022
(Source: Panther Media GmbH / Alamy Stock Photo)
Opt-outs by Starry and others, questions of speed, and making business cases have created uncertainty for enterprise network planners looking to reach offices and homes by operators fueled by the Rural Digital Opportunity Fund.
The Rural Digital Opportunity Fund (RDOF), an FCC plan to spend over $20 billion to close the digital divide, drew interest from startups and household-name carriers alike.
The goal, to connect five million unserved homes and businesses with broadband service at a minimum of 25Mbps downstream, remains. But several upstart winners have dropped off the winner's list because of financial problems or the inability to supply high-speed Internet access.
Starry, others withdraw from the RDOF funding program
Top 10 bidder Starry announced on October 20 that it is withdrawing from the RDOF program, under which it had been awarded nearly $270 million in funds to cover 108,506 locations in nine states. Facing financial challenges, the startup fixed wireless access provider also announced a 50% workforce reduction and a hiring freeze.
"At present, we don't have the capital to fund our rapid growth," stated Starry CEO Chet Kanojia, in prepared comments.
Starry is but the latest winner to withdraw. GeoLinks and Cal.net also defaulted on winning RDOF bids. And SpaceX’s Starlink funding was withdrawn due to concerns over the ability of Elon Musk’s startup satellite operator to supply fast enough services.
Starry was one of the top ten bidders in the RDOF auction. GeoLinks wasn’t far behind, winning $234.9 million to cover 128,297 locations across three states, including $149 million for 92,678 locations in California. Cal.net received $29.2 million to cover 44,153 locations in California.
Enterprise IT impact
What do these developments mean for those in underserved and unserved rural areas – and network planners hoping to connect them to corporate networks?
“I’m not certain there’s too much IT managers can do when this happens, and it’s going to happen more often as longer applications for funding are reviewed,” cautioned Jeff Heynen, Vice President of Broadband Access and Home Networking for Dell’Oro Group, a global consulting and market analysis firm.
Operators continue to face challenges in making a business case for delivering broadband service to a limited addressable rural subscriber base. Keeping tabs on their efforts and learning about other broadband programs can help IT managers.
Been there, seen that
Telecom history is full of examples where operators struggled or did not make a solid business case for the deployment of infrastructure services. Among those on the list were early wireless data offerings and telco TV. And fearing stranded investment, operators in the U.S. long limited the deployment of fiber-to-the-home until it became more cost-effective than copper-based technologies.
In rural areas, nearly one-fourth of the population (14.5 million people) lack access to this service. In tribal areas, nearly one-third of the population lacks access, according to the FCC. “Even in areas where broadband is available, approximately 100 million Americans still do not subscribe,” which shows broadband is a business case for consumers as well.
Keys to understanding the rural broadband opportunity.
Understanding the RDOF process, akin to spectrum auctions, is incredibly involved and takes an extended period to complete. No program created to award $60 billion in funding to interested carrier applicants can be set up and provide funding quickly.
The same holds true for aspects of the Biden Administration's multi-tiered $1.2 trillion Infrastructure Investment and Jobs Act, which created, among other things, to provide states with hundreds of millions to deliver broadband to their masses.
What happens to the rural areas that RDOF dropouts had planned to serve? When asked this, the FCC said that these areas could be covered by other state and local funding programs. Heynen agreed, noting that funding and subsidies for those in rural areas began with the COVID-19-focused CARES Act in 2020. It was followed by the infrastructure and jobs bill, whose Broadband Equity, Access, and Deployment (BEAD) Program, provides $42.45 billion to expand high-speed internet access by funding planning, infrastructure deployment, and adoption programs in all 50 states and territories.
Residences can also receive help from the Affordable Connectivity Program (ACP), which is a long-term, $14 billion program to help ensure people can afford the internet connections they need for work, school, and more. The ACP program provides wireless internet for low-income households. Participants include Verizon, Frontier Communications, Spectrum, AT&T, and Comcast.
Is timing everything? Given recent developments with the RDOF program, network planners would be well advised to get up to speed on these programs.
“IT managers in rural areas are likely going to have to keep an eye on what type of funding their local operators are waiting on—whether RDOF or BEAD,” advised Heynen. “In many cases, it is quite possible these operators have already gotten some funding through the CARES Act to expand fiber availability. But in the end, the money is going to be given out carefully, which means it’s going to be a long time before these network expansions are completed.”
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Why Connectivity Makes Work From Home a Work in Progress
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- Published on 12 October 2022
(Source: Panther Media GmbH / Alamy Stock Photo)
Residences can require business-class access services to support greater productivity, broadband bandwidth for collaboration, and robust security to better protect the expanded enterprise network.
Last year, enterprises used a variety of solutions to provide secure remote connectivity to what became a work-from-home (WFH) mode of operation for the entire organization. Today, the WFH mode of work has taken root though workplaces have reopened. Hybrid office/home arrangements are gaining momentum and increasing the workload for IT managers.
Increased bandwidth use, security challenges, and emerging connectivity options have IT managers working to ensure those at home can be more productive, and the enterprise network better defended.
Business or residence?
Many of the problems in this undertaking result from the differences between residential connections and those typically used for business locations. “Residential broadband connections and services are still best-effort with limited SLAs that are nowhere near as airtight as business-class SLAs,” according to Jeff Heynen, VP of Broadband Access and Home Networking for Dell’Oro Group, a global research and advisory services firm. “This is a big reason for the price delta between residential and business-class broadband services. IT managers have little control and even less recourse for solving connectivity issues, so that, in and of itself, is a headache.”
What’s enterprise IT to do about ISPs? IT managers should press each remote worker’s ISP to check to see whether the provider offers what Heynen calls a “business-lite” service tier that supplies added security features and increased SLAs. “We have heard of more ISPs offering these types of services and connections as a response to the growth of remote workers.”
Knowledge is power: Engage ISPs for security specifics and Internet access options. IT managers should press each remote worker’s ISP to supply details about the security of their Internet connection. On the management front, it is essential for IT managers to enforce a common security framework across all employees and their devices, regardless of location or access point. This helps make sure VPN and antivirus software remain current across all devices. Do not forget to implement parameters for gaining access to network resources, such as continually polling devices and requesting identity verification.
Define and protect the perimeter. A bigger concern, though, is security - both device security and data security. When workers were all in an office, the perimeter of security mechanisms and enforcement was within the enterprise. But now the perimeter must be extended to workers’ homes, as well as to public Wi-Fi locations. However, the latter should be avoided as they are notoriously insecure, according to Heynen who strongly recommends remote workers steer clear of using VPNs on unsecured public Wi-Fi networks.
VPN Pros and Cons
VPNs do a good job of providing extra levels of security. But in the remote work world, those VPNs can often get overloaded, which affects performance. Further, because of the extra levels of security, VPNs often throttle upstream traffic. “Residential networks—particularly cable—are upstream-constrained by design, so performance can often reach frustrating levels for remote workers,” warned Heynen. IT managers also need to ensure VPN and antivirus software remain up to date across all devices.
Planning for Internet access upgrades
The success of an accelerated shift to hybrid working model hinges on the quality of underlying reliable and secure connectivity, according to Cisco’s Broadband Index 2022. The vendor surveyed 60,000 workers across 30 markets globally to learn about their home broadband access, quality and usage, economic and societal growth.
The findings: Cisco reported “75% of the people polled believe broadband services must dramatically improve to fully support hybrid work. This is further reflected in 43% of respondents who are planning to upgrade their Internet in the next 12 months.”
Access and performance concerns
After many months of working from home, it became clear that Internet connections to residences needed higher than available upload channels as users moved from content consumption to video conferencing and collaborative tools such as Microsoft Teams to accomplish tasks. Long used to connect remote workers to corporate networks and resources, VPNs were not designed with heavy collaboration between distributed locations in mind. As a result, VPNs can stifle collaboration among remote workers.
Enter: Symmetrical Internet Access
The need for symmetrical Internet access – where download and upload links support the same speed - has become an increasingly prominent issue. Fiber-based Internet access providers are quickly rolling out these offerings but cablecos are lagging, which puts timing in question as they try to catch up with DOCSIS 4.0.
Including un- and underserved locations
Further, work from home programs and approaches can be when employees are in un-served and underserved parts of the country, such as rural areas, where broadband may be on the way but is still essentially a pipe dream. The lack of broadband access in these instances limits the level of participation of remote workers in many work efforts.
The broadband breakout powered by the Biden administration’s Infrastructure Investment and Jobs Act is supplying billions in funds nationwide for states to build far-reaching high-speed networks. This massive initiative aims to close the Digital Divide and reach areas lacking broadband access, but it is a process that will take time.
The satellite opportunity
For those that cannot wait on the broadband breakout to reach remote WFH locations, Low Earth Orbit (LEO) satellite fleet operators such as SpaceX, ViaSat, and OneWeb supply an Internet access choice. IT managers must first check service availability as many providers’ rollouts are still a work in progress.
Related content:
What’s Driving Symmetrical Internet Access?
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- Published on 27 September 2022
(Source: Pixabay)
COVID-19 and broadband funding legislation together supercharged interest in equal speed download and upload connections as carriers lead the way.
Over two years of COVID-19 lockdowns and restrictions forced a prolonged switch to virtual versions of work, education, and healthcare, with far greater use of online gaming and streaming OTT video services.
These services have increased traffic on residential broadband networks. “ISPs have responded by further improving their networks, intensifying their fiber deployments, and upgrading their existing infrastructure,” explained Elizabeth Parks, President and CMO for Parks Associates, a research and consulting firm focused on the use of carrier services and the home. “Consumer intention to upgrade their home internet service remains at an all-time high.”
Add infrastructure funding
Now add the Infrastructure Investment and Jobs Act’s tens of billions of dollars in funding to close the digital divide over five years, and you have a broadband breakout featuring the deployment of optical networking technologies to deliver -in part-the equal speed download and upload access links.
Symmetrical Internet is a connection that gives you equally fast download and upload speeds. Most Internet connections have much faster download speeds than upload speeds. But that’s changing with the wider deployment of fiber.
Carriers continue symmetrical Internet
Customers have been moving in volume, to higher-speed Internet access tiers, according to research released this year by OpenVault, which supplies broadband industry analytics. As subscribers migrate to higher speed tiers, the number of subscribers with speeds of 200 Mbps or slower has declined almost 90% during the past year.
AT&T, Google, Verizon, and CenturyLink are among the growing list of carriers offering symmetrical Internet access, with speeds ranging from 940 Mbps to 5 Gbps, and prices from $65 to $180 a month. The market for faster and symmetrical Internet is expanding as more applications – such as Microsoft Teams – and services are used from increasingly smart homes as companies transition from full work from home to increasingly more appealing hybrid scenarios.
The smart home drives symmetrical Internet access
Demand for more bandwidth in smart homes is real, according to ongoing user-driven research from Parks Associates. As of Q2 2022, the typical US home Internet household owns a mean average of 16 Internet-connected products: 11 consumer electronics products, three smart home products, and two connected health products. This average rises to over 25 devices for smart home households and almost 24 for households above 3,500 square feet in size.
Symmetrical Internet – want vs. need?
To recap, some service providers have slammed symmetrical Internet access with Charter CEO calling it a marketing ploy and the Wireless Internet Service Provider (WISP) association claiming their members’ offerings provide the bandwidth customers need today and will tomorrow.
So, who's driving growth in the use of upstream usage? Just gamers? The top 1% of subscribers account for approximately 30% of upstream usage, and the top 5% of subscribers account for more than 50% of upstream consumption, according to research from OpenVault in April 2021.
Despite those who claim symmetrical Internet access is not necessary and is a marketing ploy, carriers continue to spend on delivering the coveted services.
Symmetrical Internet rollouts continue
In August, Lumen announced it had launched gigabit Quantum Fiber service in 20 new communities, including parts of Denver, Minneapolis, Phoenix, Salt Lake City, and Seattle. Quantum offers symmetrical speeds of up to 8 Gbps.
In July, Consolidated Communications sold its wireless holdings to a Verizon entity for $490 million to fund its fiber expansion and delivery of symmetrical Internet in its footprint. Consolidated claimed it’s already delivering symmetrical 2 Gbps service across its entire territory, which extends over parts of California, Illinois, Maine, Minnesota, New Hampshire, Pennsylvania, Texas, and Vermont.
Dubbed Fidium, its service offers 1 Gbps service priced at $70 per month or 2 Gbps at $165 per month. In May, Consolidated teamed with a Southern Vermont communications entity to supply symmetrical gigabit broadband to almost 12,000 homes in Bennington County.
Industry insights
For enterprises – and carriers – justifying symmetrical Internet access appears to be easier, as market research and analysis delivers data points showing a continued increase in upload speeds and popularity from those unhappy with the longstanding disparity in the speed of the two channels.
In July, Recon Analytics founder Roger Entner claimed a survey the firm conducted revealed that more than a third of likely Internet switchers consider symmetrical speed important when they plan their decision - and that they're willing to pay more for equal speed links.
Rising cableco prices for asymmetrical Internet connections is driving interest in symmetrical options.
For Q2 2022, cable giant Comcast registered zero growth in Internet subscribers for the first quarter ever. Other cable companies reported unimpressive Internet subscriber figures.
The Bottom Line
It looks as if the pandemic has changed the nature of upstream usage for the long run, even as full-time work from home evolves toward a hybrid approach. That, combined with a newfound appreciation of videoconferencing, will drive the use of what has been a limited upstream capacity of carriers’ broadband infrastructures.
OpenVault went further in April 2021, declaring that "the unique role of the upstream channel as an enabler of two-way communication makes unfettered performance essential.”
Why Middle Mile Networks Matter to Enterprise IT
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- Published on 15 September 2022
(Source: Pixabay)
In the wake of the broadband access-focused Biden spending bill, the NTIA has earmarked $1 billion for carriers to enhance and upgrade the crucial infrastructure that connects the last mile to long-haul networks.
In its rush to roll out high-speed services to un and underserved areas, the Biden administration's infrastructure investment and jobs act has focused on the broadband access segment of carrier networks.
But now help is on the way for the middle mile, which connects access networks to high-capacity national and regional backbone networks. The NTIA has launched a $1 billion fund for carriers fortifying this segment for enterprises of all sizes.
The National Telecommunications Information Administration (NTIA) is within the Department of Commerce and is the Executive Branch agency responsible for advising the President on telecommunications and information policy issues. The NTIA’s programs and policymaking focus on expanding broadband Internet access and adoption.
Big bucks for middle-mile broadband
In May, the NTIA ‘s Enabling Middle Mile Broadband Infrastructure Program released a Notice of Funding Opportunity (NOFO) along with key dates for carriers interested in landing a piece of the $1 billion for the middle mile of their networks. All applications for funding must be received by September 30.
Funds will be disbursed on March 1, 2023. Complete buildout of middle-mile infrastructure must be completed no later than five years after the receipt of the NTIA funds.
Who is eligible?
Any state, political subdivision of a state, tribal government, technology company, electric utility, utility cooperative, or public utility district is eligible for middle mile funding, according to the NTIA. The list also includes any telecommunications company, telecommunications cooperative, most any type of nonprofit, economic development authority, or any partnership of two or more of these entities.
Enterprise IT impact
“Subsidization of middle mile networks is intended to expand their reach into more communities so that they can deliver premium broadband services to both residential and business customers,” explained Jeff Heynen, VP of Broadband Access and Home Networking with Dell’Oro Group, a global market research and analysis firm. “Without those networks, communities are on an island. So, they are critical infrastructure that deserves as much attention as the last mile networks themselves.”
Given the historic spending on network upgrades and expansion funded by the infrastructure and jobs act, Heynen believes that the NTIA will need to distribute more than $1 billion to cover the essential costs.
Middle mile challenges for IT leaders
Know your provider. IT managers should always be aware of who is supplying middle mile access to their retail service provider. Most are not household names, and many are not known for spending big on their networks, as serving rural areas is expensive.
Aging infrastructure. Have middle milers underinvested in their infrastructure? Fair, poor, or worse performance can be indicators of this. “Critical edge POPs and data centers might not have the best connections and could result in poor network performance, especially for cloud-based services,” cautioned Heynen.
Spending challenges. Expense can limit some middle-mile networks. Middle-mile providers avoid remote communities with low residential and business density for the same reason last-mile providers have stayed away until the infrastructure investment plan. Compared with building in densely populated urban areas, expanding into rural communities is expensive for many.
Performance issues. Problems meeting or exceeding service level agreements (SLA) covering performance can mean middle mile networks are due for upgrades or replacement. SLAs need detailed descriptions of every service offered. Service definitions should include how the services are delivered, whether maintenance service is offered, and where dependencies exist.
Investment targets. With the NTIA funding program, the hope is that middle milers will spend on optical transport, switches, and carrier routers—generally all aggregation equipment. But do not forget about the fiber and conduit itself. They will need a lot more of that to get to new POPs, data centers, and small cell locations.
Follow the money. IT managers may need to track the NTIA funding program process and plan accordingly as carriers often must wait a long time between bidding and release of funds, as was the case with the Rural Development Opportunity Fund (RDOF).
Learn the program. “Understand the federal broadband funding and state grant programs, their timelines, and process. Manage the timeline between winning the bid and getting the funding,” advised Cisco’s Robin Olds in a recent blog on the vendor’s website. “For example, the Rural Development Opportunity Fund (RDOF) grant process in some cases took more than a year between when a bid was submitted to when money was appropriated.” The middle mile carriers must understand these factors before they can produce a timeline for enterprises.
Check on possible delays. IT managers should check with these service segment providers to see if and how supply chain issues, chip shortages, and inflation may affect the enhancement, expansion, and upgrades of middle-mile networks.
The Bottom Line
Large federal infrastructure plans: the FCC’s RDOF, the Biden administration's infrastructure and jobs act, and now the NTIA’s $1 billion middle mile program, collectively portend to change the way business does business moving forward.
Understanding how these funding efforts work, what they include, and their likely timelines should give IT leaders valuable insight and perspective that can be used to enhance enterprise network planning in turbulent times.
Related articles:
Retailers Explore Drone Delivery Options as Market for Faster Fulfillment Emerges
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- Published on 02 September 2022
(Source: Pixabay)
Early implementers favor partnerships over Amazon’s expansive, do-it-yourself model. What are the top considerations for IT leaders?
Retailers Walmart and Walgreens continue to move forward with drone delivery services, even as innovator Amazon has yet to launch its decade-in-the-making offering.
That is because enterprises are evaluating drone delivery alternatives to time and resource-intensive DIY internal efforts that allow IT managers in retail to get running and valuable experience faster.
Drone delivery progress report
Amazon rival Walmart has been delivering items from select stores in its home state of Arkansas via drone for a year through a partnership with innovator DroneUp, a drone delivery flight services provider. Another competitor, Alphabet’s Wing, launched commercial drone deliveries in Texas in April with customer Walgreens pharmacies.
In late May, David Guggina, Senior Vice President of Innovation and Automation, Walmart U.S., announced in a blog that Walmart-DroneUp would be expanding its delivery network partner to 34 sites by yearend. This provides "the potential to reach 4 million U.S. households across six states – Arizona, Arkansas, Florida, Texas, Utah, and Virginia. This provides us the ability to deliver over one million packages by drone in a year."
The drone opportunity
Drone package delivery is alive and well, according to a team of experts at McKinsey’s Aerospace & Defense Practice, who has been tracking its emergence on a global level and have identified three keys to those looking to launch.
“The industry is real and booming,” according to the McKinsey team. “Over the past three years, there have been over 660,000 commercial drone deliveries to customers, not including the countless test flights to develop and prove the technology.”
In fact, the team wrote, drone deliveries had become a daily occurrence. “As of early 2022, we estimate that more than 2,000 drone deliveries are occurring each day worldwide. The growth rate is accelerating every week, and we project that there will be close to 1.5 million deliveries in 2022, up from just under half a million in 2021.”
Critical juncture
While drone package deliveries are growing, and important indicators are positive, the management consulting firm sounded words of caution about the road ahead.
“We are at a critical time in the drone delivery industry. Volume has grown dramatically in recent years, but the path ahead is not yet clear,” according to McKinsey. “Regulations, customer acceptance, and cost will all determine whether the industry reaches its potential to disrupt global logistics or remains limited to isolated applications.”
Key factors for enterprise IT leaders:
1) Regulatory landscape
The regulatory landscape can make or break an enterprise’s drone delivery undertaking by dictating the scale and scope of the operations.
“Regulation dictates the type of operations allowed, including parameters related to geographic areas and airspace, times of day, and the conditions required for flight. All these factors can have a large impact on costs,” according to the McKinsey team.
“Regulation can determine or limit one of the key costs of launching drone delivery, the operator-to-drone ratio. There is a big cost difference if, for example, regulations require one operator for each drone or allow a single operator to control a dozen or more drones.” Regulations also determine airworthiness requirements for drones, and the guidelines could potentially increase costs and delay at-scale operations, the McKinsey team wrote.
2) Public reaction (and acceptance?)
Another gating factor in the launch of a drone delivery service is the need to gain the public's trust and acceptance of drone delivery (and maintain it). New ways of doing business in towns and cities for visible approaches like drone delivery can evoke concerns by consumers.
The firm explained that actual adoption is likely to differ across neighborhoods depending on a variety of factors, including population density, geographic location, and local weather conditions.
3) Cost(s)
Consumers will favor deliveries with the lowest cost if all other factors are equal. While drone deliveries have grown markedly worldwide in the last few years, some only extend one mile from stores, as is the case with Walmart's program with DroneUp, as per FAA regulations.
4) Technology
Drone deliveries only go as far as a blend of technologies can take them. IT managers in retail and beyond need to plan accordingly as few have the deep pockets and technical resources committed to Amazon’s undertaking.
The serial innovator has built many sophisticated delivery platforms. In a website posting dated June 13, the company claimed to have “created more than two dozen (drone) prototypes.”
Further, Amazon has gone far beyond creating delivery drones themselves by building an advanced sense-and-avoid system to make air operations safer during flight.
Drones and the 5G advantage
The emergence of 5G networks can boost the operational efficiency of drones, according to Adam Schink, Senior Manager of Innovation & Scouting at BT Global, in The Future of Innovation: How 5G Is Pushing Drone Technology Forward.
“A connection to a 5G network means a drone can send information back to base in real time. Early drone technology meant all the information from drone-mounted cameras, sensors and telemetry could only be uploaded from the drone’s hard drive once it had landed,” Schink wrote. A 5G connection changes all that and opens new possibilities.