Madam Chair and members of the committee, thank you for the opportunity to appear before you this morning.
CTA is the trade association representing the $386 billion consumer technology industry. Our members include 2,200 companies, 80% of which are start-ups and small businesses, as well as more than 160 companies in Canada.
Much like the association itself, our drone policy working group reflects a diverse group of both large and small companies, including component suppliers, drone manufacturers, retailers, and service providers.
We're active on drone-related matters in several areas, including public policy, market research, consumer education, and industry standards.
As a champion of innovation, CTA has been a long-time advocate of clear rules authorizing drone use in the national airspace. In general, we believe it is important that Canada strike the appropriate risk-based balance in developing rules that support innovation and safety, with benefits to consumers and commerce.
CTA has been working with various stakeholders, including legislators and regulators in the U.S., to advance the drone industry, address safety and privacy issues, and promote the safe and beneficial use of drones.
In the U.S., CTA has partnered with the Federal Aviation Administration, or FAA, on the Know Before You Fly campaign to educate consumers on the safe operation of drones. Last year we served on the FAA's registration task force charged with developing consensus recommendations to the FAA on the registration of drones. Earlier this year, we served on the FAA's micro-UAS aviation rule-making committee, which developed consensus recommendations regarding drone flights over people.
CTA also supported the first permanent rules regarding commercial drone operations in the U.S., which took effect this past summer.
Rules regarding drone operations should embody a risk-based approach to integrating drones into the national airspace in order to maximize safety, utility, and economic benefit. Each rule, restriction, and requirement should reflect the appropriate amount of risk to that activity and then balance that risk with the associated benefits of that activity.
Rules for drones also should be flexible, for rapid technological innovation. To ensure that new drone-related technological developments are not stymied, drone rules must allow for sufficient flexibility and innovation, particularly for the small drones that constitute the vast majority of consumer and commercial operations.
At the same time, policy-makers should maintain a degree of control that is appropriate to the risk involved. When the risk is low, policy-makers should let innovation and experimentation flourish.
Already there are many hardware- and software-related examples of technological innovation supporting safety in drones and drone operations, but we must be careful to avoid mandating specific technological solutions at the expense of future safety-related developments or alternatives.
Regarding recent regulatory proposals for drones under consideration in Canada, our members have expressed concerns in a couple of areas. One concern is the proposed insurance requirement mandate for all UAVs. The other concern is the proposal to lower the regulatory category weight threshold for very small, low-risk drone operations from two kilograms down to one kilogram.
We are aware that regulatory alignment initiatives are under way between the Canadian and U.S. governments in several industrial sectors and topic areas, which are certainly important, given the significance of trade between the U.S. and Canada.
Regarding drone policy and recognizing the market response and industry support for the rules that took effect in the U.S. last summer, we would support Canada's careful consideration of regulatory alignment opportunities with what is already in place in the U.S.
As we head into 2017, one of our biggest challenges related to drone policy is with regulation at the local level.
Our industry is committed to a coordinated policy-making process between the public and private sectors. In the U.S., the FAA has reminded and educated state and local officials about the federal government's exclusive jurisdiction over drone safety, flight altitudes, flight paths, and no-fly zones.
Our members are concerned that misaligned and conflicting local rules could lead to a sloppy patchwork of mandates that restrict entrepreneurs and start-ups, stifle job creation, and confuse professional and recreational drone users.
Drones will change our lives for the better, providing quick delivery of supplies and medicine, enabling better crop production and efficiency, and allowing for safer inspection and maintenance of our infrastructure.
According to an AUVSI study, the U.S. drones market is driving the creation of more than 100,000 jobs over the next decade.
CTA forecasts U.S. drone sales will reach record heights by the end of this year, topping 2.4 million units—that's up 112% from 2015—and $1 billion in shipment revenues, which is up 80% compared with 2015.
With accompanying services, the drones market could easily exceed $1.3 billion within five years, and given the right policy environment, which includes balanced rules, stakeholder collaboration, and consumer education initiatives, we could see over a million UAV flights per day in North America by 2025.
Thank you again for the opportunity to appear here this morning. I look forward to any questions you may have.
