 Hey, it's Ben Popper with The Verge. I'm here at CES 2016. I'm about to sit down and have a chat with Brendan Schulman, who is the VP of Policy and Legal Affairs at DJI, the world's most popular drone company. So tell us just a little bit about yourself, how you got into drones, and how you got to the job you are at now. So I'm the VP of Policy and Legal Affairs. My role is to really help educate government officials, try to help advocate reasonable regulations for the technology. My background is actually as a model aircraft enthusiast. I've been into radio control planes for over 20 years. So over the last year, we've seen actually quite a lot of movement from the regulators here in the U.S. What do you make of the moves by the FAA and the DOT in terms of creating a registry and working towards sort of a broad set of rules for commercial use? I think that's a good mechanism for getting people to take responsibility and to be accountable if they get into trouble. And also it's an opportunity for education. People who register are given the FAA guidance on how to operate safely, and that's really in everyone's interest. So you come from the world of model aircraft. What do you think of the fact that some of the larger organizations from that world are protesting, telling their members not to register? And I believe there are several legal challenges being mounted to the registration. Registration in and of itself is a good policy outcome. I don't think anyone objects to the idea that there should be some level of registration for some category of drones. You could debate what weight cutoff to use. You could debate what types of drones. And I think the challenge that we've seen is that there's a community where they already have what's essentially a registration process. The AMA has a requirement to put your AMA number or your contact information on the model aircraft. And essentially the FAA is duplicating that. So from a policy point of view, their system works as well as the FAA's rule. And the real concern is that in 2012 Congress said not to introduce new rules for model aircraft that are used recreationally. And this is perhaps a non-objectionable rule, but it's a rule. And I think the concern is if you can introduce a rule that contradicts that statute from 2012, what's going to happen next? What new regulations would we see that might overreach and be unacceptable to the community? So the problem is really one of process and how the rules are made. Clearly the scale at which these craft are now being used is what's changed. And that's why fundamentally we have to come up with a new structure for policing them, right? Well, I think those numbers tell you that the technology is very safe. I mean, there really are a limited number of incidents that raise safety or security concerns. The problem is that those are the kinds of incidents that are very noteworthy that make the news and that really unfortunately also drive the policy decisions, particularly at the state and local level. The number of reports that suggest that people are using drones to invade privacy, countless reports about that in theory, and I have yet to hear of one actual instance of somebody using a drone to spy on a neighbor. We did have a prosecution in New York State. There was a gentleman who was flying around a medical facility and was alleged to have been spying on people who were being examined in the medical offices. He was prosecuted all the way through jury verdict and acquitted under the existing New York State unlawful surveillance law. So we didn't need a drone-specific law to prosecute him in New York State. He was acquitted because he wasn't actually spying on anyone. The building was actually had mirrored finish on the window, so he couldn't have been spying, and yet if he had been, he would have been prosecuted and convicted of that crime. So I think the issue is to come to reasonable outcomes, both in terms of safety and responsibility, and a lot of the answer there is education, providing information to the user about how to operate in a safe manner. Now, I know DGI doesn't work on this, but if we were to think about a world in which Amazon and Google achieve their mission and there's thousands or tens of thousands of drones flying over a major city like Las Vegas or New York, would that require new regulations or would that require only technology and structure in order to make sure that they stay in their lane, they get where they're going with minimal accidents? I think very much that technology is going to solve the kinds of issues like that. What do we do when we have more traffic than now? I don't think the skies are going to be blanketed in drones. If you think about the size of a drone relative to airspace, drones are quite small. They're not going to collide with each other just because they're near each other. They would have to change the FAA rules around line of sight, around having a pilot at all times, and they would have to change the designations in the airspace to carve out space for low speed, high speed, packaged, manned. There would be things that need to be done on the regulatory side, right? That's true. If you consider drones to be aircraft and to already be fully regulated, you run into a lot of contradictions or complications and that's actually one of them. Delivering packages is considered an air carrier operation. It doesn't make sense that the drone that's delivering a package versus taking a photograph is basically doing the same thing. It's just leaving something behind. In the manned traditional aviation world, that's an air carrier operation and therefore outside of the rules that are currently being made and will be released this year by the FAA. You've got the beyond visual line of sight issue of how do you fly far enough away to actually make that delivery worth doing while also ensuring that you aren't posing a threat to other air traffic. I think that's a technology solution but also a regulatory one, you're correct, because the proposal that the FAA has now for commercial operation is within line of sight. So basically as far as you can see it or the surrounding airspace. So I know you're not going to like this question but yesterday when I was on the panel right before you, there was a former member of the FAA who I believe now is a drone lawyer or lobbyist who was leading the panel. Do you remember his name? Jim Owens? Yeah. Okay. And he said, I think we understand when we look back at the history of manned aviation that in order to make progress, some people have to die. By that he only meant that the industry is going to grow to a robust size. We're going to be doing lots of things in an environment which to some degree will always be dangerous, flying in the air. And as we make progress and build new things and grow in scale, somebody, there will be an accident, somebody will die. Do you think that that's a reasonable way to think about what's going on in the drone industry? I think if you look back at the history of manned aviation, the early pioneers, there were weekly deaths. So you go back to those old newspapers where they talked about the pioneers flying around. We tolerated a much higher level of risk back then than we do today, particularly in the aviation world. So people are extremely sensitive to safety for any kind of aviation. And I think even disproportionately so. So you have, you know, yes, there are safety risks and they will lead to incidents that might raise concerns. Thankfully we've had, if you think back to the history of DJI, we've been around for 10 years. We're celebrating our 10th year anniversary now. And I have yet to hear of any fatality anywhere in the world attributable to the kind of multi-rotor drones that we or other companies like us sell. And we've tried to estimate the number of operational hours that we have. It's tough to do because we don't really track all that information, but a rough estimate is probably like 3 million operational hours per month. If you consider, for example, general aviation, which is currently highly regulated, and you look at statistics there, for every 100,000 hours of a private airplane like a Cessna, you've got 1.5 fatal accidents. So we already tolerate a level of risk. And the question is, are we going to tolerate any level of risk for drones? I think the fact that there's no one on board is great because you're already dealing with a safe technology. What I would be concerned about is that, you know, in the course of doing anything, there are going to be risks. And if there's an overreaction to an air safety incident, that could hamper the growth of the industry. Right. Yeah, I mean, again, DJI is primarily focused on selling drones to consumers and cinematographers, people in Hollywood, but now you're expanding out drones that are optimized for spraying crops. Recently, one with a thermal camera that would be used by fire departments or search and rescue. And so I'm sure that your drones will play a large role in the industrial applications. Actually, I think like two-thirds of the commercial exemptions in the US are for DJI products. So when you think about it like that, are you comfortable with the idea that these drones could be used for, you know, something that begins to bleed back towards, you know, law enforcement or military use? I mean, I know that there are already police departments that are thinking about how to use them, you know, just for the kind of things that they would have normally used a helicopter for. Well, so we don't market to government, to military government or law enforcement. Obviously, everyone who's interested in the beneficial uses of the technology is going to find the platforms that work the best, the most reliable, the most easy to use. So we have users across the spectrum, everyone from the backyard flyer to the top of the line Hollywood cinematography. And I think, for me, that the government agency applications are by far the beneficial ones, the search and rescue opportunities, whether it's using the new thermal camera or even just photography. But to me, you know, you get if you put a drone on the back of a fire truck, you were going to help save lives. And you know, the risks that we just talked about, the risk of a fatality or a collision is already outweighed by the number of people whose lives have been saved. So you got to get out there and have us journalists write more of these positive stories, right? Every time you get a cat out of a tree, there needs to be a story. Look, news is news. And I think if it bleeds, it leads. I don't know what to tell you. That's how that's how the business works. You know, that's that's for you to decide. But there are great stories out there to be found and told if you want to find them. So I'll ask you one more question and then we'll wrap things up. Do you think we'll get to a point where drones are as ubiquitous as smartphones, maybe, or personal computers, cars, something that every family has one of because there's a lot of utility that you can get out of it and it's not so difficult or dangerous that people are worried about having one? It's hard to make that prediction at this point. If you think about the history of the computer and how you needed like the basement size mainframe to do anything, and now we've got something that's like a million times more powerful in our pocket, it's hard to see the application. So we just released version three of our SDK. So I think in the future, we're going to see like smartphones, apps written for drones to do all sorts of beneficial things. So will the drone be used to go fetch the newspaper in the morning or walk your dog, that sort of household uses that might lead to everyone owning one? It's hard to say, but I think it's very exciting to imagine where we are now compared to where the PC industry was or even the mobile telephone industry was. This is like the age of those giant clunky car phones and we've got years and years ahead of us. So from like a legal perspective, if the drone walks your dog, does it have to scoop the poop or is that? Yes. Okay, got it. Great. Well, we'll end on that note. Be sure to check out the verge for lots of great drone stories from CS 2016. Go to DJI and see what they're up to with drones and subscribe to the YouTube channel above. Thanks. Thank you. Okay.