By: Dawn Zoldi
Drone technology policy debates in the United States center around autonomy. It has reshaped long-held regulatory paradigms and spurred innovation across industry and government. From the Federal Aviation Administration’s (FAA) sweeping Part 108 Notice of Proposed Rulemaking (NPRM) to urgent calls for universal electronic conspicuity and the polarizing issue of Chinese drone bans, the latest Full Crew newscast brought together experts to dissect the policies shaping uncrewed aircraft systems (UAS).
Moderator Mike Pehel facilitated the discussion among three of the sector’s top voices: Sarah Nilsson, attorney and Associate Professor at Embry-Riddle Aeronautical University (ERAU) and leading drone law author; Jason Lorenzon, attorney and Assistant Professor of Aeronautics at Kent State University; and Kenji Sugahara, Director at the Oregon Department of Aviation and national drone policy leader (who is also an attorney!). Their insights revealed a regulatory crossroads, one where autonomy, airspace integration and geopolitical risk increasingly drive national priorities.
FAA Part 108 NPRM—A New Framework for BVLOS Autonomy
As the most significant UAS regulatory overhaul since Part 107, the FAA’s Part 108 NPRM aims to redefine how drones operate beyond visual line of sight (BVLOS) in U.S. airspace. Nilsson offered a succinct summary of its scope. (See also AG White Paper by Nilsson on Part 108 NPRM).
Instead of focusing on individual pilot certification as under Part 107, Part 108 proposes a corporate responsibility model, placing the burden of compliance on operating companies. Nilsson explained, “Organizations are going to be involved—not just remote pilots with 107s. So this is kind of an interesting twist.” There are two new avenues for corporate approvals: permits (for lower-risk, capped operations in less-dense areas) and certificates (for larger-scale and more complex flights). (See prior AG overview of NPRM). This shift signals greater FAA oversight for high-risk operations, with certificate holders facing stricter safety and reporting obligations–and, as Nilsson pointed out, possibly higher fines for violations.
Nilsson highlighted the introduction of the Automated Data Service Provider (ADSP) to enable safe, scalable BVLOS through distributed traffic management, weather updates and real-time deconfliction. Nilsson provided the FAA definition of ADSP: “They’re a person or company who provides an automated data service using a distributed computational system to support or manage aircraft operations, promoting safety and efficiency.” She further highlighted, “Third-party service providers… are going to be the first to approve services that support UTM (UAS Traffic Management)… and then eventually to approve services that support what we call XTM, extensible traffic management.”
Sugahara noted that the NPRM also mandates autonomous flight, a major evolutionary leap. “There is a prohibition on manual control of your drone,” he explained. “So if you… have a current drone that has manual control, that’s not eligible for 108. So… regular 107 pilot[s]… are going to have to buy completely new platforms to be able to comply with 108.” This autonomy-first approach forecasts a future where human intervention is minimized, with flight coordinators permitted to issue altitude or emergency commands, but not use manual piloting.
Population density categorization, shielded area operations (allowing close flights near infrastructure), enhanced cyber and physical security requirements and an embedded Safety Management System (SMS) round out some of the rule’s other key features. (See prior AG coverage of Part 108 SMS). The rule also introduces new weight categories, with UAS limits of up to 1,320 pounds to support delivery and AAM use cases.
“This is superb,” Nilsson said. “Now we’re bringing SMS into the drone world. With respect to the people working, I like that we have a 14-hour duty day, a max of a 50-hour work week.”
In closing, she emphasized the fact the industry still has the opportunity for its voice to be heard. “Part 108 awaits. This is a notice of proposed rulemaking. In other words, now is the time for everybody to give their two cents worth and post on the Federal Register their comments,” she urged.
America’s Drone Ecosystem at a Crossroads: Domestic Innovation vs. Chinese Platform Bans
The crossroads faced by the U.S. drone ecosystem reflects a strategic struggle to foster domestic innovation while grappling with security concerns surrounding Chinese platforms. Lorenzon distilled the core tension. “This is a huge deal… Is technology pushing the law or law pushing the technology?… What are the regulatory restrictions? What are the mechanisms of government coupled with market building incentives? Most of my clients in this area are… humble startups with not a lot of capital. So, we’ll have to see how this goes,” he observed.
Federal action is mounting through both “stick” (regulatory bans and security investigations) and “carrot” (funding and procurement incentives) strategies. Measures like the Commerce Department’s Section 232 investigation, Information and Communications Technology and Services (ICTS) rulemaking, and National Defense Authorization Act (NDAA) procurement reforms aim to reduce reliance on Chinese hardware and software, especially DJI, while channeling billions toward domestic manufacturing capacity.
However, the prospect of a ban brings controversy. Sugahara warned, “You do not innovate by banning. You compete on merit and technology. If there’s a compelling product out there, people will buy it…” He continued, “We do not have the manufacturing capacity in the United States as of now to fill the need of all the commercial operators out there… You’re talking about losing probably around 70% of the small businesses out there if there is a DJI ban that comes down.”
For public sector agencies and smaller firms, a ban could mean operational disruption and soaring costs, as affordable domestic alternatives lag. Lorenzon reiterated, “Some fear domestic platforms may be unable, in the near term, to match the price and functionality of Chinese counterparts… What other type of American drone can I purchase that’s $300 to $400? I don’t know if anybody on this panel can answer that right now,” he noted.
Nonetheless, security and supply chain independence remain urgent concerns for regulators. Lorenzon acknowledged, “The strategic vulnerability of relying so heavily on a single overseas supplier for both hardware and software… poses risks not only for security but also for supply chain independence.”
Nilsson added nuance, reflecting on long-term risks. “That is the argument—if you’re dependent on them and their supply chain stops because of some kind of conflict, then that is crucial. That is probably my only argument for having ‘made in the USA,’” she explained. Nilsson also highlighted the importance of “risk appropriate mitigations” rather than blanket bans–ones that align public safety needs and data sensitivity with pragmatic controls.
The Challenge of Airspace Modernization: From “See-and-Avoid” to Electronic Conspicuity
The final segment tackled America’s “elephant in the airspace”: a legacy regulatory model ill-suited for autonomous operations and high-density UAS integration. Moderator Pehel drew parallels to “automobiles yielding to horses” to emphasize the urgent need for a paradigm shift in airspace rules.
Central to this debate is the requirement for universal electronic conspicuity, where all aircraft, manned and unmanned, broadcast their position electronically to facilitate real-time traffic separation and collision avoidance.
Sugahara observed, “As we go into an environment where things are more automated, things are more electronic. There’s a big problem with the lack of being able to see these aircraft…” But the same old tech may not work. Emphasizing the importance of allowing “not just ADS-B Out, but also a lighter weight version that could be handheld and Technical Standard Order (TSO) compliant at a very low cost that could have a battery installed. That’s going to change the game especially for these folks without electrical systems.”
The current “see-and-avoid” principle, rooted in human visual detection, remains embedded across most low-altitude Class G airspace, where 96% is uncontrolled and manned aircraft are typically not outfitted with electronic tracking. This forces high-tech UAS into restrictive operational silos, despite being better equipped for safety and situational awareness.
Lorenzon summarized the risk: “The biggest proponents of opposition to drones are actually aircraft pilots… If there is a vehicle that’s autonomous and something goes wrong, where’s that vested interest because there isn’t that person who’s flying it on board. That’s still a very simplified idea, but I think that’s something that needs to be addressed as we move on, especially when we coexist.”
Nilsson stressed the need for bridging legacy systems (voice communication, manned aircraft) with advanced UTM frameworks (digital coordination for UAS): “The need to have a UTM framework that bridges between us crewed pilots who are on voicecom and a drone, let’s say, that is on LAANC where it’s all digitized. Where is that bridge and when is it going to happen?”
Mapping the Future of U.S. Drone Tech Policy
This Crew demonstrated a sector at inflection, balancing autonomy, innovation and security against deeply entrenched aviation industry and regulatory norms. From Nilsson’s call to action on the FAA’s public comment period to Sugahara’s plea for pragmatic risk mitigation and Lorenzon’s reminder of market realities, the discussion underscored how the next phase of U.S. drone policy will be shaped by voices from every sector. The challenge ahead lies in harmonizing these perspectives into a resilient, innovation-forward policy framework that ensures safety, competitiveness, and technological leadership.
Pehel aptly concluded, “It’s a shared airspace. We need to be able to coexist in it.”
Read the Articles Discussed In this Episode:
- Sarah’s Article: Matt Sloane Read the Entire FAA Part 108 NPRM So You Don’t Have To—Here’s What Actually Matters (Dronelife)
- Jason’s Article: America’s Drone Ecosystem at a Crossroads: The Dual Approach to Boosting Domestic Industry and Addressing Chinese Platforms (Dronelife)
- The Elephant in Airspace: The Elephant in the Airspace: How Outdated Approaches Ground America’s Aviation Leadership (Commercial UAV News)