Question

Watch the attached video and read the paragraphs that follow. Once completed, describe in 300 words how this new technology can impact Amazon.

In 2013 Amazon announced a bold new venture: a drone delivery service that could bring products to customers within 30 minutes. Three years later, the e-commerce giant completed its first Amazon Prime Air delivery during a trial run in Great Britain. Of course, the company still has a long way to go before its drones are ready to take flight in great numbers. Along with figuring out many technical details, Amazon must also deal with regulations that limit where drones can and cannot fly. In the U.S., for instance, drones are not allowed to soar above densely populated areas.

As a result, Amazon has established research facilities in Great Britain, Austria and France in order to test its drones in less regulated skies. At its British outpost, the company currently has two customers enrolled in a pilot program for Prime Air. While this lucky pair have made headlines for receiving Amazon’s first drone-delivered packages, perhaps the company‘s most important work is being done at its R&D center in France. In this facility located near Paris, about a dozen software engineers and aviation experts are building an air-traffic control system for the company’s growing drone fleet.

Amazon researchers first tried to adapt air-traffic methods used by airlines only to discover that these techniques didn’t work with low-flying drones. Instead, they began to develop a system that focuses on guiding drones past obstacles like power lines, buildings, and birds. This approach relies on creating detailed maps that include temporary objects like construction cranes as well as up-to-the-second weather conditions. What’s more, the autonomous drones will also be able to warn each other in real-time if they encounter any risks on a flight. Despite these latest advancements, though, there’s still no telling when Amazon Prime Air will be ready to go live. “This is highly regulated,” said Amazon’s VP for global innovation policy Paul Misener. “We’re not going to launch this until we can demonstrate its safety.”

Answer 1

Since the inception of e-commerce, led by Amazon, ebay etc the USP of this segment has been the ease with which consumers could buy products,ordering and getting it delivered it to their door through the click of their mouse.

But one major advantage that traditional brick and mortar stores had was that consumers could have their products instantly. To negate this disadvantage, e-commerce companies have been constantly trying to reduce delivery times and optimise delivery costs. This led to a reduction in delivery time from weeks to days to a couple of hours. But this lightning fast delivery was rise in costs.

So then, in this evolution the next step is delivery within minutes and within manageable costs. This is where Prime Air comes in.

To make customers opt for slower delivery compared to local shops, ecomme-com companies have to offer substantial discounts. If the delivery window can be shortened, then these discounts can be reduced, thus raising profits. Further, this can help in reducing the reliance on manpower for delivery, replacing them with machines, further reducing costs.  

Though it seems very profitable, the technology involves significant challenges, both technical and regulatory. But overcoming these challenges is key to driving growth in a tough market.