Strange that an article with this title that talks so much about Amazon&#x27;s drone efforts doesn&#x27;t examine Amazon&#x27;s relationship with the delivery industry. Amazon desperately wants to economically remove the time lag between buying something from Amazon and buying from the nearest Wal-Mart. Drones have the potential of significantly improving delivery times and costs in the long run, but the delivery industry has little incentive to innovate in this area since they already command high margins on small package deliveries.<p>For Amazon, it&#x27;s not necessarily about how well they can execute on their drone delivery program. I imagine that Amazon will actually make a go of turning drone fulfillment into a business, a la AWS, though the effort is still worthwhile for them even if that never happens. With this drone program, they are able to provide a large scale proof of concept, working through legal barriers that are relatively trivial for a company with Amazon&#x27;s resources, but insurmountable for hypothetical drone logistics startups that might want to put pressure on UPS et al. But once the grunt work is done, the barriers to competing in the logistics industry through drone fleets will be substantially diminished.<p>This is the big upside for Amazon here: paving the way for increased competition in the delivery industry (whether it ends up primarily being driven by Amazon, incumbent companies, or startups) which will have the likely impact of improving it&#x27;s unit costs while having the potential of eventually bringing it into parity with regards to the largest remaining advantage that Wal-Mart retains, same-day delivery.<p>The unit costs and limitations aren&#x27;t particularly relevant to much at this point in time. Those will significantly improve as competition increases, as is typical in maturing technology industries.