Drone technology stands a good chance of becoming a lucrative business in Hungary. However, for investors and industry players to move forward, legislation is badly needed.
With Christmas only a few days away, it means that, much to delight of the tech-savvy, many a drone will land under the Christmas tree, besides smart phones, consoles and other gadgets.
According to the Hungarian National Drone Association (MNDSZ), the number of drones in Hungary surpassed 100,000 in early fall and their popularity just keeps growing. That should come a little wonder: with a price of between HUF 50,000 and HUF 150,000, a decent entry-level drone is now affordable for many.
“The drone industry is on the brink of a revolution,” Kornél Szepessy, CEO of Hungarian air navigation service provider HungaroControl, said at the First Hungarian Drone Expo and Conference last month.
“Manufacturers are working hard to meet demand but the resourcefulness of people as to where to use of drones is also incredible.” The number of drones in Europe could reach ten million in the next five-or-six years, he added. In Hungary alone, experts expect to see 27,000 flights per day by 2025. By way of a comparison, today the volume of the entire civil aviation in Europe is 30,000 flights per day.
Although the majority of these flights are and will continue to be made by hobbyist – last year only 3% of the 383,000 flights in Hungary were commercial, this year it will be 8% of the estimated 811,000, HungaroControl calculates – drones are an attractive business proposition as well. Drone technology and related services will see around USD 60 billion investment in the next five years, Goldman Sachs reports. Extrapolating the drone industry’s contribution to global GDP will result in approximately HUF 72 million in revenues in Hungary in 2025, Szepessy said.
No industry will remain unaffected. At the expo, MyActionCam, a drone and camera specialist, had a recent crop-spraying drone on display from one of market-leading Chinese manufacturer, DJI. At first sight, the approximately HUF 3 mln-plus price tag in Hungary might suggest that only large farms could afford to use it but that’s not necessarily the case.
The return on investment might be longer for smaller farms, yet the efficiencies achieved by drones could still make it a worthwhile investment. They can, for example, navigate difficult terrain, like sloping ground, which ground sprayers cannot. It is little wonder that the wine industry is interested in them worldwide.
“A new tractor costs anything from HUF 8 mln onwards, the sprayer [attachment] is another HUF 1 mln-2 mln,” says Péter Bakonyi of the eponymous Bakonyi Winery. “But what’s more important is that drones don’t push down the ground while spraying, which results in less compaction and, therefore, healthier soil,” he adds.
Beyond sales and renting, MyActionCam offers a range of services including training to its clients, who range from agriculture, to energy and the media.
“Several organizations buy drones to improve their businesses but don’t know how and when to use them,” Ferenc Damak, the managing director told the Budapest Business Journal. “We help them integrate drones into their business from the selection of suitable equipment, to training of the staff, to integration into internal processes.”
Utilities and network operators are among the largest potential drone users. To better maintain its power grid network and decrease outage issues, E.On Hungary has bought a number of drones and trained staff to use them.
“This technology gives us an excellent overview of the grid from a different perspective,” Gábor Gyimesi, head of power network department at E.On Dél-dunántúli Áramhálózat Zrt. told the BBJ. Using the data gained during power line inspections, E.On teaches the drones to recognize and detect typical damage or faults and process the information, which is then forwarded to maintenance team.
E.On also uses drones to supervise the work quality of its contractors, for example pruning, Gyimesi says. The power company operates nearly 85,000 km of network, the maintenance of which requires 55 people working full time a year. At this stage, it is hard to estimate how many people the drones could replace, as they need to be operated by staff so only part of the work is taken over, the expert says. Eventually, the company plans to partner with specialized service providers and operate robotized drones remotely. This could happen in the very near future, Gyimesi says.
The major obstacle to moving forward is not technology but legislation, or rather the lack of it. Today, people are not required by law to register their drones: a permit from the authorities and insurance is basically what one needs to fly. In the case of non-private use, the activity must be reported to the aviation authority. To obtain a permit to fly, one must submit an application to the Military Aviation Authority at least 30 days prior to the planned flight.
This 30-day deadline isn’t realistic, many professionals claim. “I am now working on the set of an action movie where often it is only days before I find out if they need a drone or not,” says Attila Pethe, the owner of Skyviewair, a drone-related service provider. “All I want is that [the rules for] professional flying are made simpler.”
To make things easier, HungaroControl created Mydronespace, a website and an app that aims to cut the red tape somewhat by allowing previously registered and approved users to request a permit. Using one’s phone to obtain approval rather than sending documentation via post or email is indeed more true-to-life and means you can also see up-to-date information on the airspace, weather conditions, etc. However, until new legislation comes into effect, the app is deactivated. It also isn’t clear how long in advance users will have to apply.
Red tape also promotes illegal usage by individuals. Should someone wish to tape a wedding, for example, but forgets to submit a request within the allotted timeframe, they will either make a video from the ground or, probably more likely, will fly the drone illegally. another problem is that the current legislation does not distinguish between a drone being flown illegally but in an area of airspace over with no other traffic in it and at a height of five meters, or flying your drone illegally at Budapest Airport. HungaroControl would like the new legislation to fix that, Szepessy notes.
To coordinate issues related to Unmanned Traffic Management (UTM), HungaroControl has created a so-called UTM Innovation Hub, it was announced at the conference, which aims to overview the industry potential and give input to lawmakers. When this will be finalized remains to be seen.
“I hope that the UTM innovation hub announced today will help the players concerned understand the needs of the industry and will boost the creation of a concept,” Szepessy said at the time.
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