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Ever since Amazon unveiled its futuristic delivery drones last year, there has been much speculation and hype about what this could mean for the future of e-commerce. Now that Amazon has finally secured FAA clearance for its drone delivery fleet, some analysts have speculated that these new delivery drones will make 30-minute delivery times for any product you could imagine a reality, even in far-flung rural areas But let’s think even bigger – there could be a whole range of unintended social and economic consequences if Amazon’s drone delivery service is as successful as many predict.
Amazon could disrupt FedEx
At the same time as the FAA was certifying Amazon Prime Air to operate as a “drone airline,” a study from DePaul university looked at the phenomenal growth of Amazon Prime Air over the past 24 months, suggesting that Amazon could soon surpass DHL in terms of the sheer size of its delivery fleet. Right now, Amazon has 50 cargo airplanes in its delivery fleet, and is growing rapidly. By contrast, DHL has 77 airplanes in its fleet, leading the DePaul researchers to conclude that Amazon could eclipse DHL as soon as 2021. Next up for Amazon would be UPS (275 airplanes) and FedEx (463 airplanes).
Presumably, one day soon, you’ll be able to look up in the sky and see an Amazon Prime Air cargo airplane dropping a fleet of autonomous drones into motion, each ready to speed to its delivery location. In a few years’ time, Amazon might become “the new FedEx.” Forget about “priority overnight” service from FedEx – with Amazon Prime Air, you might be able to get that package to its destination in less than an hour, no matter where you are in the nation, as long as it will fit on the back of a drone.
Amazon could end forever the concept of the physical retail store
Already, Amazon is upending the whole logistics game. The company is expanding wildly during the pandemic, moving fulfillment centers closer and closer to the end consumer. Your packages aren’t coming from some warehouse or delivery center in Seattle – they are coming from fulfillment centers in suburban cities all around the United States. There’s a good reason why Amazon can now offer Prime delivery service to all of its customers – it has moved closer and closer to the end consumer. And, now, with these drones, Amazon will be closer still. In the first testing phase, Amazon said it would test its drone rollout in low-population areas that are tough for delivery trucks to reach. So if you live in an isolated ski town, for example, get ready for delivery drones to drop packages on the slopes, even in the middle of a raging snowstorm.
Push on this idea a little further, and you can see how Amazon will eventually end the whole concept of the physical retail store. Order everything online and get delivery in 30 minutes or less. The whole process will be cheaper, faster and more convenient than getting in your car, driving, finding a parking spot, dealing with long checkout queues and then commuting back home. Some have even begun to discuss the concept of the “dark store” – on the outside, it might look like a retail store, but on the inside, it’s actually just a huge fulfillment center for e-commerce. Drones would leave and depart from these dark stores as needed, bringing lightweight packages right to your doorstep, based on any shopping whim you might have.
Who can stop Amazon?
By now, Amazon’s path to retail dominance seems so obvious that it’s only fair to ask: Who can possibly stop Amazon? Presumably, Walmart has something similar planned. And Google parent company Alphabet has Wing, a drone delivery fleet of its own that has partnered with Walgreen and – you guessed it – FedEx. So maybe disrupting FedEx will be harder than it sounds, if it pits tech rivals Amazon and Google in a massive winner-take-all fight for tech dominance fought by drones.
