Tech
Keep calm and

DroneOn

US-RETAIL-TECHNOLOGY-DRONES
A drone secures an order from a Wing facility during a demo in Frisco, Texas. (Andy Jacobsohn/Getty Images)

Drone swarms are coming

Don’t panic. They’re bringing that stuff you ordered.

Jeff Wise

Do you have a sneaking suspicion that an unmanned vehicle is hovering over your house? The odds that you’re right are growing fast. And that drone might just be bringing you a hamburger.

In more than a dozen locations across the US, fleets of autonomous vehicles are zipping through the sky, summoned by customers seeking convenience and a touch of novelty. These battery-powered vessels are delivering food, medicine, and other small consumer goods, often within 30 minutes of an order being placed, and they do so almost noiselessly, without adding any traffic to roads or carbon emissions to the atmosphere.

Some of America’s biggest retailers are behind the surge, and the plan is to push toward ubiquity over the next 5 to 10 years. “Between Amazon, Walmart, DoorDash, and Uber Eats, you’re going to see 100,000 or 200,000 autonomous robots operating in the lower part of the airspace,” Andreas Raptopoulos, CEO of the drone-delivery startup Matternet, said. “It will be a profound transformation of how things work.” 

Delivery drones have been simmering on the back burner for years now. They broke into public consciousness back in 2013 when Jeff Bezos revealed on “60 Minutes” that Amazon was experimenting with bringing small packages to customers using uncrewed aircraft.

Then things went quiet. Apart from a few test projects here and there, neither Amazon nor anyone else seemed to be making much progress. The problems were many. For one thing, drones were noisy, slow, and had limited range. For another, communities balked at the prospect of being swarmed by what sounded like giant mosquitos.

Most of all, what was holding drone delivery back was regulation. The Federal Aviation Administration is responsible for every form of civilian aircraft that flies in the US airspace, and while it’s an enthusiastic supporter of using that airspace profitably, it’s also extremely serious about protecting the public from danger.

As Amazon and others developed their vehicles, the FAA maintained strict rules over their operation. In particular, it mandated that each vehicle had to be controlled by a single dedicated operator who maintained a line of sight on the craft at all times.

That made delivering things by drone both expensive and extremely limited in range. To make economic sense, drones need to deliver stuff for less than about $5 to $7 a pop. That requires a vast increase in scale — an increase that can be achieved only if drones can operate autonomously, without constant supervision by human pilots. Today, insiders say, each delivery probably costs more like $50 to $70.

Though drone delivery was still a long way from viability, Amazon and others continued to fund its development. Google created its own system, called Wing, and used it to run test programs in 10 locations around the world. Walmart partnered with independent drone developers DroneUp and Zipline, while UPS launched a test project with drone startup Matternet.

Test of a delivery drone at the DroneUp hub in the parking lot at the Walmart Supercenter
Flight engineer Brian Scoles tests a delivery drone at a DroneUp hub in Florida. (Paul Hennesy/Getty Images)

It wasn’t obvious how drone delivery could ever scale to nationwide deployment, but companies believed that there was a huge opportunity. “We know that people like on-demand. That’s why Uber Eats and DoorDash alone do 5 billion deliveries a year,” Raptopoulos said. Each of those delivery services involve dispatching human beings in cars that weigh thousands of pounds, with all the cost and carbon emissions that entails. “I look at a world where there’s going to be less waste because consumption patterns are going to change,” Raptopoulos said.

DroneUp’s chief operating officer, Anthony Vittone, agreed. “In 5 to 10 years,” he said, “it’s going to be completely ubiquitous. People are going to be, like, ‘I don’t know how I lived without it.’”

As work went on behind the scenes, drones steadily improved, particularly with regard to autonomous operation. A breakthrough came in 2023, when the FAA granted permission to Zipline and Wing to fly their delivery drones beyond the visual line of sight (BVLOS) of their operators. The decision applies only to the airspace over Dallas, which has been a hub for delivery-drone development thanks to its pro-business attitude, favorable weather, and abundance of low-density zoning. The move meant drones could now cover a lot more ground. In the months that followed, the FAA granted the same exemption to all the major players. Soon, it’s expected to allow autonomous drone flights all over the country.

These changes represent a major realignment of the regulator’s attitude. “Ten years ago, you couldn’t say autonomy to the FAA without getting a huge amount of pushback,” Charlton Evans, CEO of the drone consultancy End State Solutions, said. “Now they understand that not only are the systems reliable, but that autonomy makes them more safe, not less.”

If it seems like autonomy is coming along faster for aerial vehicles than cars, that’s because the environment is simpler in some respects. There are no pedestrians in the air, no fallen trees, no 16-year-old drivers with a learner’s permits. The operating environment is actually quite narrow. Except for takeoff and landing, drones generally operate above 250 feet in altitude, to reduce noise level on the ground, and below 400 feet, to stay out of the way of airplanes. To avoid collisions, the drones use a system called ADS-B that continuously transmits each vehicle’s location.

Because drones can now largely fly themselves, a single operator can supervise many of them at once — in some cases up to 40 at a time. “Our goal is to get to 100 to 1,” Raptopoulos said.

Today, drone deliveries aren’t just demo projects anymore but real businesses. “We have customers who have ordered over 100 times,” Vittone said. Customers often start out skeptical about the utility of the service, he says, but are won over after trying it. “All they care about is that they can get what they want in 30 minutes or less. It becomes incorporated into their normal routines.”

To be sure, not everyone is equally enthralled by drone delivery. Critics say that instant fulfillment only multiplies the excesses of the on-demand economy by encouraging laziness, impulsive purchases, and overconsumption. Others fear that the drones could engage in, or provide cover for, surveillance of private property, or that it could eliminate jobs for delivery drivers. Then there’s the issue of noise. Depending on the density of a neighborhood, drones could be showing up anywhere from infrequently to constantly. And while some models produce more noise than others, all are noticeable. 

Last July, the mayor of College Station, Texas — where Amazon had been offering a trial drone-delivery service since 2022 — wrote a letter to the FAA. “Residents in neighborhoods adjacent to Amazon Prime Air’s facility have expressed concern to the City Council regarding drone noise levels,” Mayor John Nichols wrote, adding that with Amazon asking to increase the scale of its service, “residents have continued to voice their concerns to City Council that the noise levels will only get worse and will impact the enjoyment of their property.” He didn’t ask Amazon to end its service, though — only to use quieter drones.

If drone delivery is designed to be effortless for the consumer, it’s meant to be easy for the retailer as well. Zipline’s newest generation of drones work out of towers operated by a partner company’s warehouse or kitchen. Drones perch in automated docking stations where they charge between missions. When an order comes in, workers put the requested item in a compartment that’s automatically transported to the waiting drone.

At its destination, the drone lowers a descent unit called a droid on a 300-foot tether. The droid is equipped with thrusters to keep it on target as it descends, even in high winds and turbulence. Because the mothership remains high above, its noise remains almost imperceptible to people on the ground.

“Our goal is to seamlessly integrate into the environment and magically deliver the product,” Eric Watson, head of systems engineering for Zipline, said.

Zipline takes care of installing the drone tower, maintaining it, and keeping it stocked with supplies. In normal operation the tower’s functioning is entirely automated, so all the retail partner has to do is give it the item to be delivered.

“Many are already doing DoorDash-type deliveries, where their employees are picking products and then going out and handing a bag to someone that takes it to the customer,” Watson said. “What we’re doing is basically augmenting that.”

Each manufacturer’s drone model is slightly different, but the essence of the service is the same: to serve as miniature flying UPS trucks that can take anything the last mile to the customer’s door (so long as it weighs less than a few pounds).

“What we’re developing is an ecosystem where multiple different retailers, restaurants, pharmacies can get their product delivered to customers,” Vittone said.

A Zipline drone delivering supplies in 2022
A Zipline drone delivering supplies (Zipline)

DroneUp, for instance, has been working with Chick-fil-A as well as multiple healthcare providers. In December 2024, Walmart ended its contract with DroneUp, but it still works with Zipline, which has also partnered with GNC, the Cleveland Clinic, Pagliacci Pizza, and Mendocino Farms. The scale is expected to be immense. Amazon has said that by the end of the decade, it plans to make 500 million deliveries a year.

A fundamental constraint on drone delivery is that battery power limits the vehicles’ range to about 5 to 10 miles per trip. That means to service the entire country, companies need to have roughly as many drone hubs as cell towers or post offices in the US. And each operator will require its own infrastructure, as cellphone service providers do.

That kind of build-out will require a massive investment. But then so did cell towers and high-speed cable back in the day. The investment will be worth it if it solves the problem of how to feed the relentlessly growing appetite for home delivery. Zipline says that thanks to the ease and efficiency of autonomous drones, the home-delivery business will undergo 100-fold growth.

“As you fundamentally change and improve the product offering, there’s latent demand that’s unlocked,” Watson said.

What’s more, they’ll be able to feed that demand in a way that provides a net benefit for the environment. “The second-order effect of removing these cars from the road will be massive,” Matternet’s Raptopoulos said.

Of course the mark of a truly transformative technology isn’t just the space it carves out for itself, but the follow-on technologies that it enables in turn. Smartphones became indispensable because of their own innovative features, but also made apps like TikTok and Uber possible.

Likewise, drone-delivery networks will allow all sorts of future breakthroughs. By demonstrating the reliability and robustness of unmanned flight, for instance, it could well speed the arrival of pilotless, electric air taxis, which so far have struggled to demonstrate that they’re safe enough to carry humans.

As for drone service itself, many in the industry believe that it will become so ubiquitous, so deeply interwoven into the weft of everyday life, that people won’t even think about it any more than they wonder where their tap water or electricity comes from.

“The drone is going to be removed from the selling factor,” Vittone said. “It will just be an option that the retailer uses. It’s not going to be a special choice.”

Update (January 14): Added that DroneUp’s contract with Walmart ended in December 2024 and amended details around Zipline’s docking stations and tether length.


Jeff Wise is a journalist in New York specializing in aviation, technology, and psychology.

More Tech

See all Tech
tech

Tesla sales continued to fall in Europe last month — but there were a few bright spots

Tesla’s self-proclaimed “weakest market” continued to look weak in November, as sales mostly kept dropping year-over-year across European countries, including Sweden, France and Spain, Reuters reports.

However, there were a couple of notable bright spots for Tesla, which has suffered due to strong competition and an aging lineup. In Norway, as consumers face the end of certain EV subsidies, Tesla sales jumped 175% in November and about 35% for the first 11 months of 2025. Meanwhile, in Italy, sales increased 58% year-on-year after declining for six months. From January to November, Tesla sales fell 28% there.

tech

More AI startups are reportedly turning to free Chinese AI models

The biggest tech companies in the world, like OpenAI, Google, and Meta, are racing to build dozens of gigawatts of AI computing infrastructure to meet what they say is incredibly high demand.

But free, open-weight Chinese AI models like DeepSeek and Qwen have been rapidly catching up to the leading frontier models.

According to a report from NBC News, more AI startups are deciding that these Chinese models might be cheap enough and good enough to pass on the state-of-the-art offerings from OpenAI, Meta, and Google. This, of course, would be very bad news for the AI capex orgy that is currently consuming the tech sector.

As the huge, all-purpose models try to do it all, startups are taking advantage of these open-weight models, which can be distilled and customized for specific applications, and usually for a much lower cost.

According to a report from NBC News, more AI startups are deciding that these Chinese models might be cheap enough and good enough to pass on the state-of-the-art offerings from OpenAI, Meta, and Google. This, of course, would be very bad news for the AI capex orgy that is currently consuming the tech sector.

As the huge, all-purpose models try to do it all, startups are taking advantage of these open-weight models, which can be distilled and customized for specific applications, and usually for a much lower cost.

tech

“The Big Short” investor calls Tesla “ridiculously overvalued”

“The Big Short” investor Michael Burry says Tesla’s market cap has been “ridiculously overvalued” for “a good long time.” In his latest Substack post, he criticized what he calls the “tragic algebra” of stock-based compensation, arguing that companies like Tesla understate their true economic cost because, though stock-based comp is a noncash expense under GAAP, it still dilutes shareholders.

Burry wrote that CEO Elon Musk’s compensation package — which could reach $1 trillion — ensures that “dilution is certain to continue.” He estimated Tesla’s share count will expand by roughly 3.6% per year without buybacks — far higher than Amazon’s 1.3% and more comparable to Palantir’s 4.6%. In his view, failing to account for this compounding leaves investors with an overly generous picture of long-term profitability.

Tesla didn’t immediately respond to a request for comment.

Burry wrote that CEO Elon Musk’s compensation package — which could reach $1 trillion — ensures that “dilution is certain to continue.” He estimated Tesla’s share count will expand by roughly 3.6% per year without buybacks — far higher than Amazon’s 1.3% and more comparable to Palantir’s 4.6%. In his view, failing to account for this compounding leaves investors with an overly generous picture of long-term profitability.

Tesla didn’t immediately respond to a request for comment.

tech

Amazon AWS due to roll out its own updated AI models this week

This week in Las Vegas, Amazon AWS is sure to make some news at its re:Invent developer conference.

AWS is the current undisputed cloud computing leader, serving up AI computing services for many of the top players, but most importantly enterprise darling Anthropic.

Last quarter, Amazon reported that AWS revenue grew 20% year on year and it had a $200 billion backlog of contracted business it was racing to fulfill.

But AWS has greater ambitions than being just a cloud provider. Looking toward efficiency and lower costs, AWS has been developing its own AI models, named Nova. The Information reports that this week will see a significant update to Nova, which was described in the report as the company’s first real “all-in-one” multimodal model.

Last quarter, Amazon reported that AWS revenue grew 20% year on year and it had a $200 billion backlog of contracted business it was racing to fulfill.

But AWS has greater ambitions than being just a cloud provider. Looking toward efficiency and lower costs, AWS has been developing its own AI models, named Nova. The Information reports that this week will see a significant update to Nova, which was described in the report as the company’s first real “all-in-one” multimodal model.

tech

Tesla sold more cars in Norway this year than any automaker ever as buyers get ahead of tax hike


Norway is proving to be a rare bright spot in Europe, Tesla’sweakest market,” with the EV company setting an annual car sales record in the country, Reuters reports. Tesla sales jumped 175% in Norway in November compared to the same month a year earlier, selling more than 6,000 new cars there as customers race to get ahead of what’s effectively a tax hike on EVs when the country rolls back subsidies.

That brings its year-to-date total sales to a record of 28,606 cars — higher than the previous record set by Volkswagen in 2016 — with a month to spare. Last month, fully electric vehicles made up 97.6% of all new cars sold in Norway.

Meanwhile, Tesla sales continue to languish across much of the rest of Europe. Early figures show double-digit declines in France, Sweden, and Denmark in November. Sales in Spain fell nearly 9% last month. Data from October saw sales halve in both the UK and Germany. Europe is Tesla’s third-biggest market after the US and China.

Latest Stories

Sherwood Media, LLC produces fresh and unique perspectives on topical financial news and is a fully owned subsidiary of Robinhood Markets, Inc., and any views expressed here do not necessarily reflect the views of any other Robinhood affiliate, including Robinhood Markets, Inc., Robinhood Financial LLC, Robinhood Securities, LLC, Robinhood Crypto, LLC, or Robinhood Money, LLC.