Competition in drone market threatens innovators, as DJI releases sensor-laden product
Avoiding collisions one new feature of top-selling quadcopter, but who’s nipping at DJI’s heels?
The global market for commercial unmanned aerial vehicles, more widely known as drones, may be going the way of the smartphone industry as competition between Chinese suppliers intensifies.
Shenzhen-based DJI, the world’s largest supplier of civilian drones, is looking to keep a step ahead of its Chinese rivals with the release of more advanced and consumer-friendly products.
“We are entering an era where beginners can fly with confidence,” DJI chief executive Frank Wang Tao said on Tuesday in the United States at the launch of the company’s latest drone.
Designed for hobbyists, DJI’s new Phantom 4 quadcopter features highly advanced software and sensors that enable users to scan for obstacles and automatically direct the drone around the impediment when possible, while ensuring flight direction remains constant.
The Phantom 4 also breaks new ground with its ActiveTrack function that allows users to run the DJI Go app on their Apple iOS and Android devices to follow and keep the drone’s camera centred on the subject as it moves simply by tapping the subject on their smartphone or tablet.
China Merchants Securities analyst Alex Ng described the Phantom 4 as the most advanced drone in its category in the market.
“The competition is heating up, but most drone companies are doing well because of the rapidly expanding market,” Ng said.
It is a development that follows the introduction of many new Chinese commercial drone suppliers at the latest edition of the international Consumer Electronics Show (CES) in Las Vegas in January. These included companies such as 9 Eagles AEE, Autel Robotics, Ehang, Hexo and ProDrone.
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“Chinese companies both large and small will be dumping consumer drones on the market either to establish market share or increase it,” said Colin Snow, the chief executive at drone research firm Skylogic Advisors, in a recent blog post. “A lot of these are, or will be DJI clones.”
The aggressive foray of Chinese suppliers in the drone market appears to be following the trend in the smartphone market, where the likes of Apple and Samsung Electronics compete against Chinese brands offering low-priced products.
Strategy Analytics said last year’s top mobile phone brands on the mainland, the world’s biggest smartphone market, were domestic brands Xiaomi, Huawei Technologies, Vivo and Oppo. Apple ranked third.
Research firm IDC said the world’s top-five smartphone players last year were Samsung, Apple and Chinese brands Huawei, Lenovo and Xiaomi.
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According to Skylogic’s Snow, DJI already accounts for more than 45 per cent of the registered commercial drones in the US.
DJI had a 68.5 per cent share of the global civilian camera-drone market as of the third quarter last year, according to data from IDC.
“The only other vendor capable of competing with them based on feature and price is Yuneec,” Snow said.
Backed by semiconductor giant Intel, Shanghai-based drone maker Yuneec International presented last January at CES its Typhoon H drone that can also automatically avoid collisions. That product, however, is not yet commercially available.
DJI’s Phantom 4, which is priced at US$1,399, is now available for pre-order on DJI and Apple’s online stores. Deliveries will be made from March 15.
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Some analysts remain doubtful of the long-term growth prospects for these camera-equipped civilian drones.
“The consumer drone market can never become as big as the personal computer or smartphone markets,” said Lin Renxiang, an analyst at Chinese research firm iResearch.
“In the future, this market may face the same problems that GoPro is facing right now,” Lin said. He referred to US-based GoPro, the top maker of wearable cameras for sports, which is now struggling to find new source of income as its specialist camera market has become saturated with low-cost suppliers.