Drone Services Market Size, Share, Russia-Ukraine War Impact Analysis, By Service Type (Drone Platform Services, Drone MRO Services, and Drone Training & Simulation Services), By Application (Aerial Photography, Product Delivery, Surveillance & Inspection, Data Acquisition & Analytics, and Others), By End-use Industry (Agriculture, Infrastructure, Oil & Gas, Logistics, and Others), and Regional Forecast, 2024-2032

The global drone services market size was valued at USD 17.95 billion in 2023 and is projected to grow from USD 24.12 billion in 2024 to USD 213.87 billion by 2032, with a CAGR of 36.6% during the forecast period. North America dominated the drone services market with a market share of 34.32% in 2023. Moreover, the drone services market size in the U.S. is projected to grow significantly, reaching an estimated value of USD 57,707 million by 2032, driven by increased demand for precision farming to propel market size & growth.

The U.S. drone services market is experiencing a surge in demand for various industry applications, such as agriculture, construction, e-commerce, healthcare, retail, and real estate. The rising demand for surveying and mapping applications has heightened the need for drone services in the real estate sector. In addition, the growing demand for autonomous delivery services has also propelled the need for drone services across the retail and food industries.

Drone services refer to the use of Unmanned Aerial Vehicles (UAVs) for various purposes, such as delivering packages, capturing images or video, conducting surveys, and so on. Equipped with advanced technologies such as cameras and sensors, drones have become versatile tools in various sectors, including construction, agriculture, real estate, and others. 

Moreover, they offer a wide range of services, including aerial photography and videography, drone pilot training, drone maintenance and repair, and drone-based data collection. Drones also play a vital role in urban air mobility (UAM) for transporting goods from hubs to consumers and people for leisure, logistics, medical, or emergency recovery services. Additionally, they can be used in hazardous environments, such as inspecting oil rigs or power lines, which are quite tricky and dangerous to perform by manpower. The escalating demand for high-quality data further increases the demand for drones as a service for various end-user industries, which is expected to propel the growth of the market from 2024 to 2032.

Drones services were a key enabler in the fight against COVID-19 by aiding supply chain resilience and serving as the ideal device to deliver goods from the so-called “six feet away.” The pandemic has been a catalyst for drone innovation, as communities and companies have begun to recognize that the benefits and positive effects of drones outweighs their risks.

RUSSIA-UKRAINE WAR IMPACT:

Russia-Ukraine War to Contribute to Market Growth Due to Rising Product Demand for Surveillance and Attack Operations

The conflict between Russia and Ukraine is driving the global drone services market growth. This war has resulted in increased usage of drones for military purposes, as both countries employ them to monitor each other's military activities, equipment, and personnel. This leads to a rise in demand for drones for surveillance and reconnaissance missions. For instance, in March 2023, the Ukrainian government announced the expansion of its drone services program, focusing on surveillance and attacking enemy targets from longer distances. The government also disclosed its collaboration with more than 80 Ukraine-based drone manufacturers.

Moreover, in January 2023, the Ukrainian government decided to augment the procurement of UAVs by allocating almost USD 550 million toward purchasing drones for the Armed Forces of Ukraine. AeroDrone focused on manufacturing drones for crop-dusting, has modified its capabilities to use drones for transporting supplies for Ukraine's armed forces. Both Ukrainian and Russian forces used a variety of Unmanned Aerial Vehicles (UAVs), also known as drones, for surveillance and attack operations.

In September 2022, according to the state-owned corporation Rostec, Russia's KUB and Lancet kamikaze drones have been extensively deployed during combat operations in Ukraine. The Russian military actively relies on ZALA Aero's UAVs, primarily for precision strikes on remote ground targets.

Furthermore, Russian forces have employed these drones for surveillance and reconnaissance missions in the conflict zones of Ukraine. However, there has been a significant decrease in drone service for civilian and commercial purposes due to the impact of war.

Drone Services Market Trends

Implementation and Adoption of Drone to Improve Delivery Models in Various Industry Verticals are Pivotal Market Trends

Autonomous drones are UAVs that can operate without human intervention, using advanced software, sensors, and cameras. These drones have been playing an essential role in various industries such as agriculture, construction, mining, and logistics. The introduction of artificial intelligence (AI) software improves the overall performance of unmanned aerial systems, enabling drones to recognize objects, examine information, and provide real-time analytical feedback.

The retail and logistics sectors are investing in and leveraging drone technology to introduce new and flexible delivery models. In the near future, several industries will incorporate drone technology to drive innovation in areas, such as surveillance, research, and last-mile delivery. E-commerce companies, pioneers in research and development are focused on reducing operational costs in last-mile delivery, while improving delivery times. Their focus extends to integrating drone technology into mobile applications, aiming to deliver better user experiences.

Drone delivery services will continue to expand over the next few years, requiring companies to invest in their drone delivery programs and technological improvements for operational growth and cost-effectiveness.

In January 2024, Drone Delivery Canada (DDC) entered into multiple commercial agreements to deploy its drones at Edmonton International Airport (YEG). This 12-month agreement, valued at USD 417,000, involves expanding the defined route delivery from YEG with an additional DroneSpot at a medical clinic in Leduc, Alberta. DDC will commence deploying the site infrastructure shortly and expects to begin providing drone delivery services under the commercial agreements later in 2024. The YEG drone delivery project, which began with the execution of an agreement with YEG in 2019, became commercially operational in May 2022.

Furthermore, strategic partnerships and collaborations, product innovations, and developments are also critical trends in the drone services market.

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Drone Services Market Growth Factors

Increased Demand for Precision Farming to Propel Market Growth

Drones are becoming smaller, lighter, and more reliable, which allows them to perform a broader range of tasks. Their growing popularity stems from benefits such as improved efficiency, cost-effectiveness, and safety. Due to the advancements in software and artificial intelligence, the increasing use of drones is making it easier to control and automate them. They play a crucial role in improving farming techniques. Improving productivity, and are used for environmental monitoring, disaster relief, and search & rescue operations.

The increase in precision farming needs, aiming to boost crop productivity, drives market growth. Drone OEMs are investing in R&D for thermal cameras, multispectral sensors, and LiDAR, improving drone efficacy in monitoring fields, creating vegetation maps, and detecting issues such as disease and irrigation irregularities. Thus, it drives the market growth during the forecast period.

Agricultural drones, flying at a specific altitude with sensors, provide crucial analytical data for controls crop health, treatment, exploration, field soil analysis, and yield assessments, aiding farmers in making informed decisions and reducing time and costs.

In August 2023, Dhaksha Unmanned Systems, a subsidiary of Coromandel International and a leading Indian drone manufacturer secured a contract from IFFCO to supply 200 medium-altitude logistics drones and 400 agri-spraying drones to the Indian Army with an aggregate value of USD 1650 million.

In addition, in July 2023, IoTechWorld avigation Pvt Ltd, a leading agri-drone manufacturer won a contract from IFFCO to supply 500 drones for nano liquid urea and DAP spraying.

Furthermore, in January 2022, Indian union ministry of agriculture and farmers welfare issued guidelines to make drone technology affordable to the farmers. As per the guidelines, the farmer producer organization (FPOs) will be eligible to receive grants up to 75 percent of the cost of agricultural drones for its demonstrations on the farmers’ fields.

Rising Demand for Aerial Photography and 3D Scanning in Building Information Modelling (BIM) to boost the Market Growth

In recent times, photography has gained popularity across many applications due to high availability of low-cost drones equipped with high-resolution cameras. Aerial photography provides more comprehensive approaches in large township projects, multi-story building projects, and smart city projects. Thus, rising demand from the real estate and infrastructure industry is driving the market growth.

Aerial images provide accurate and precise measurements, a feature that ground perspectives often lack. Drones use camera sensors and 3D scanning for building information modelling (BIM) applications.

The growth of drone photography aligns with the expanding 5G infrastructure, contributing to advancements in disaster risk reduction and prevention. Increased adoption of drone imaging technology in industries of various verticals such as government, military and defense, energy, civil engineering, agriculture and forestry, media and entertainment will drive growth. Moreover, key companies are focused in developing imagery libraries for applications including natural disaster response, property assessments, and urban planning.

In January 2024, IG Drones, a Noida-based unmanned aerial vehicle company, secured a contract from the Uttarakhand government to survey the Uttarakhand Metro Rail Project for personalized rapid transport (PRT) corridor. IG Drones will use high-tech drones equipped with advanced sensors for capturing high-resolution images, videos, and other data.

Additionally, in July 2023, Drone surveying company, RocketDNA Ltd entered into a five-years contract at USD 1.18 Million with South32 for surveying two mine sites in South Africa.

Increased Government Initiatives and Investments Propel Market Growth

The increasing support from government initiatives is driving the growth of the market. Governments globally are investing in drone technology for various purposes such as agriculture, construction, and environmental monitoring. For instance, in January 2022, the agricultural ministry of India announced a monetary grant program, Sub-Mission on Agricultural Mechanisation (SMAM), to facilitate the purchase of agricultural drones. Additionally, 'Drone Shakti', part of the 2022 Union Budget, aimed to encourage drone-as-a-service and support drone startups.

Additionally, governments are investing in drone technology to support their military and security operations. For instance, the U.S. Department of Defense has allocated over USD 3 billion in its budget for the development and deployment of drones in military operations. These initiatives help drone operators to grab further opportunities which, in turn, is predicted to boost the market growth.

RESTRAINING FACTORS

High Regulatory Framework and Safety Concerns are expected to Hinder the Market Growth

Regulations imposed by governments on drone services, aiming to address privacy breaches and safety concerns, pose challenges to market growth. However, these regulations can often be complex and time-consuming, making it difficult for businesses to obtain the necessary permits and approvals to operate drones. The U.S. federal government has implemented stringent regulations for operating unmanned aerial vehicles due to the safety concerns from commercial and passenger planes. Some key restrictions have been implemented to avoid severe accidents from drones or UAVs.

The government has restricted the fling or carrying operation of drones to a close perimeter of one kilometer. Furthermore, the U.S. federal government banned drones from flying at night or no light period and restricted an altitude to above meters.

Similarly, the Indian government has implemented strict rules on drone services including the requirement for drone pilots to request permission before every flight via a mobile app. Termed “No Permission, No Takeoff” (NPNT), the system automatically processes requests and either grants or rejects them. Drone pilots attempting to fly without permission from the Digital Sky Platform, are barred from takeoff. Additionally, all drone operators in India must register their drones and obtain flight permissions for each operation through India’s Digital Sky Platform, with detailed details available on the DGCA website since December 1, 2018.

For Instance, in October 2023, a shocking mid-air scare occurred at Kempegowda International Airport (KIA), when a drone operated by unidentified persons dangerously approached two IndiGo planes during takeoff. In response, the airport authorities initiated a departmental probe to track the operator who breached the no-drone zone, prompted by the pilots alert to the Air Traffic Control tower.

Additionally, on December 25, 2022, an unmanned aerial vehicle (UAV) carrying a box with blood vials fell on the Delhi Metro Magenta Line, in India, resulting in an hour-long disruption of service and causing panic. The incident raised safety concerns about the increasing frequency of drone-related incidents in the future.

Furthermore, safety concerns are a significant obstacle for the drone industry. Drones are often flown in crowded areas, and their potential to cause harm to people and property is a concern for governments and the public. This has led to a range of safety regulations, such as mandatory safety features, including geo-fencing, remote identification, and collision avoidance systems, to ensure the safe operation of drones. These factors are expected to hinder the growth of the market.

Drone Services Market Segmentation Analysis

By Service Type Analysis

Drone Platform Services Segment Led the Market Due to the Growing Use of Drones for Emergency Response and Public Safety

By service type, the market for drone services is divided into drone platform services, drone MRO services, and drone training & simulation services.

The drone platform services segment dominated the global drone services market share in 2023 and is estimated to be the fastest growing during the forecast period. This is due to the growing use of drones for emergency response and public safety. Drone platform services refer to a range of software and hardware solutions that enable the safe and efficient operation of drones

Drone MRO services comprise maintenance, repair, and overhaul services for items such as wind turbine blades, solar plates, and oil & gas pipelines, especially in hard-to-reach locations. The drone MRO services segment is expected to register significant growth during the forecast period due to increasing demand for low cost and effective inspection services across various sectors.

By Application Analysis

Surveillance & Inspection Segment Leads the Market Owing to the Increasing Demand for Surveillance and Inspection Operations from Various Sectors

By application, the market for drone services is categorized into aerial photography, product delivery, surveillance & inspection, data acquisition & analytics, and others.

The surveillance & inspection segment dominates the market. It is estimated to be the fastest growing segment during the forecast period, owing to rising demand for surveillance and inspection operations from agriculture, oil & gas, mining, and other sectors.

The product delivery segment held the second-largest share in the application segment. It refers to the use of drones to deliver goods to customers. This entails specialized drones equipped with sensors and GPS technology to navigate and deliver packages to their intended destinations. The rising demand for fast and efficient delivery services is anticipated to boost the product delivery segment.

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Infrastructure Segment to Dominate Due to Rising Product Demand for Aerial Surveying and Mapping 

By end-use industry, the market for drone services is segmented into agriculture, infrastructure, oil & gas, logistics, and others. 

The infrastructure segment dominated the market in 2023 due to the usage of drones in aerial surveying and mapping in the construction industry across the globe.

The agriculture segment is predicted to witness significant growth during the forecast period. The segment's growth is due to the increasing demand for crop monitoring and spraying in agriculture. Additionally, increasing demand for aerial photography and videography is also expected to foster the growth of the segment over the forecast period.

REGIONAL INSIGHTS

In terms of geography, the market for drone services is divided into North America, Europe, the Asia Pacific, the Middle East, and the rest of the World.

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North America dominated the market in 2023 and was valued at USD 6.16 billion. This growth is attributed to the presence of major OEMs in the region and the increasing investments in research and development of next-generation drone technologies. For instance, in March 2023, Wing, a U.S.-based subsidiary of Alphabet, launched its new delivery system. The system includes cost-effective, customizable pickup stations, and numerous charging hubs. By implementing these changes, the company aimed to shift the focus of its drones from resembling standard delivery vehicles workers to adopting characteristics akin to workers in a gig economy. 

The market in Europe held the second-largest share in the base year. This growth is due to surge in demand for inspection services. Drones are increasingly used to inspect hard-to-reach areas such as wind turbines, pipelines, and bridges. Furthermore, the European Union Aviation Safety Agency (EASA) has developed regulations that allow for the use of drones in commercial operations, which creates a favorable regulatory environment for the growth of the market in Europe.

Asia Pacific is expected to be the fastest growing region during the forecast period. This region's high market growth is attributed to the rising usage of drones in agriculture sector. Additionally, the regulatory environment for drones in agriculture is becoming increasingly favorable in this region, with several countries introducing regulations and guidelines to facilitate the use of drones in agriculture. For instance, in the year 2022, India, the government has launched a program to promote the use of drones in agriculture, while in Japan, the government has introduced regulations to allow for the use of drones in rice cultivation.

The Middle East is anticipated to witness significant growth during the forecast period due to growing product use in the oil & gas industry. For instance, in January 2023, Saudi Aramco, the world's leading oil producer, plans to invest USD 14 million in Terra Drone, a Japanese company specializing in drone and air mobility technology. Terra Drone would use the funds to establish a subsidiary, Terra Drone Arabia, which would offer oil and gas inspection services to Saudi Aramco.

The rest of the world is anticipated to witness moderate growth in the market during the forecast period. The growth is owing to increasing partnerships and collaborations of companies to enhance their services.

List of Key Companies in Drone Services Market

Expansion of Services and Technological Advancements by Leading Players to Propel Market Expansion

The global market is highly fragmented with key players, such as Aerodyne Group, Terra Drone, AgEagle Aerial Systems Inc., Cyberhawk, DroneDeploy, and others. Major players are focusing on expansion of services, product innovations, and expansions into emerging markets to increase their market share. Drone operators are expanding their services to the renewable energy industry, providing services such as solar panel inspections, wind turbine inspections, and oil and gas pipeline inspections, reducing the need for manual inspections that are costly and time-consuming.

LIST OF KEY COMPANIES PROFILED:

• Aerodyne Group (Malaysia)


• Terra Drone (Japan)


• AgEagle Aerial Systems Inc. (U.S.)


• Cyberhawk (U.K.)


• DroneDeploy (U.S.)


• Matternet (U.S.)


• PrecisionHawk (U.S.)


• Phoenix Drone Services LLC (U.S.)


• SenseFly (Switzerland)


• Sky Futures Ltd (U.K.)

KEY INDUSTRY DEVELOPMENTS:

• January 2024 - AFWERX, an innovation arm of the Air Force, chose Advanced Aircraft Co. for the advancement of its small hybrid advanced multirotor unmanned aircraft system, also known as HAMR. The contract to develop hybrid-electric drones for the Air Force bagged USD 1.25 million. The contract was signed to provide the warfighters with an efficient and rugged uncrewed aircraft capable of conducting military support operations in austere environments.


• January 2024 – DroneAcharya Aerial Innovations Limited bags a contract from Indian Army for Advanced Pilot and GIS Training in Jammu and Kashmir. The Defence Tender values is of USD 1.18 million. The training Program will be conducted on-site and will cover a diverse range of advanced modules, including Night Flying, challenging maneuvers, emergency response, data processing and image interpretation.


• January 2024 - Walmart, Zipline and Wing teamed up to provide drone delivery for up to 75% of the Dallas-Fort Worth population, establishing the most significant automated unmanned aerial vehicle delivery footprint in the U.S.


• January 2024 - Navy Chief received the first Medium Altitude Long Endurance Unmanned Aerial Vehicle (MALE UAV) Drishti 10 ‘Starliner’ from the Adani Defence and Aerospace (ADA) in Hyderabad. The Ministry of Defence (MoD) and the ADA signed a contract 10 months ago for the supply of four MALE drones for the Indian Navy and Army. Drishti is an advanced surveillance and reconnaissance platform with 36 hours of endurance and 450 kg payload capacity. It is the only all-weather military platform with NATO’s STANAG 4671 certification for the UAV system’s airworthiness.


• August 2023 – The Indian Army has signed contracts for the procurement of 130 tethered drones and 19 tank-driving simulators under Emergency Procurement (EP). These long-endurance tethered drone systems will be acquired from Bengaluru-based NewSpace Research & Technologies Pvt Ltd for an approximate value of USD 2500 million.

An Infographic Representation of Drone Services Market

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REPORT COVERAGE

The global market research report provides a detailed market analysis. It comprises all significant aspects such as R&D capabilities and optimization of the operating services. Moreover, the report offers insights into market analysis, trends, regional analysis, and primarily highlights vital industry developments. In addition to the factors mentioned above, it mainly focuses on several factors that have contributed to the global market in recent years.

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