Ready or not ... Photographer: Martin Divisek/Bloomberg
Ready or not ... Photographer: Martin Divisek/Bloomberg

Like the owls that deliver packages and carry messages in Harry Potter's world, drones are about to become commonplace in ours: small flying objects perfectly engineered to drop off burritos, pick up prescriptions and photograph revolutions. Within the next three years, drone-driven commerce will amount to $13.6 billion and create 70,000 new jobs, an industry trade group estimates.

Domesticating Drones

There is turbulence ahead, however. The Federal Aviation Administration has been asserting for years that it has broad authority over drones but hasn't been able to come up with any rules covering their use. That didn't stop the agency from fining a 29-year-old Swiss man, Raphael "Trappy" Pinker, for flying a Styrofoam drone over the University of Virginia. The FAA said that Trappy's stunt, carried out in the course of filming an advertisement for the university's medical school, amounted to a dangerous airplane flight. Last week, however, the National Transportation Safety Board declared that the agency couldn't bar the commercial use of drones without conducting an official rule-making process.

Back in 2012, Congress told the FAA to put guidelines in place by 2013 and have a plan for detailed drone regulation by 2015. The agency will miss both of those deadlines. And its dithering has put it in an awkward legal position: The FAA may have ample potential legal authority over drones, particularly when it comes to safety, but its inability to hammer out the details is keeping it from taking a stand on their commercial use.

In the meantime, uncertainty about drones' legality has driven entrepreneurs to sell their drones outside the U.S., in places such as Brazil and Colombia. And there are still no rules on privacy invasion, even though it is very likely that drones will be filming in locations near you. Every state should establish a coordinated licensing and privacy regime for drones as quickly as possible. There's no time to wait for the feds to catch up.

Drones fire the imagination: They can be used to deliver beer to ice fishermen, take photos of spring training, and monitor the progress of construction projects. Stunning YouTube nature videos captured by drones demonstrate that wilderness areas are prime hunting grounds for drone owners. People for the Ethical Treatment of Animals, in turn, uses drones to hunt hunters, which has prompted a few states to pass laws that prohibit drones from interfering with legal hunting. (PETA insists it is interested only in illegal hunting; hunters insist they will shoot down PETA's drones.)

This week's federal court decision may temporarily hearten drone enthusiasts, but the larger story is one of uncertainty. The FAA has made a gesture towards rule making by creating sites in six states for testing drone use, but it's unclear what exactly a testing state will be allowed to do and what the process will be for test-site approval. And although the privacy implications of widespread drone use are enormous -- imagine something very small constantly filming you and yours -- the FAA is probably not the right agency to make rules in this area. Meanwhile, commercial drones in Brazil are being used by police to find drug labs and by farmers to spray pesticides on crops.

Forty-three states have proposed drone legislation, and 13 states already have laws on the books. They range from a Texas criminal statute outlawing picture-taking by drones to an Oregon law allowing property owners to sue against drone overflights.

This patchwork is simultaneously confusing for investors and underprotective of consumer privacy interests. The states should get together and hammer out a baseline licensing regime -- as soon as possible. The drones are already here.

(Susan Crawford, the John A. Reilly Visiting Professor in Intellectual Property at Harvard Law School and a fellow at the Roosevelt Institute, is the author of "Captive Audience: The Telecom Industry and Monopoly Power in the New Gilded Age." Follow her on Twitter at @scrawford.)

To contact the writer of this article:
Susan P. Crawford at scrawford@scrawford.net.

To contact the editor responsible for this article:
Mary Duenwald at 1+212-205-0366 or mduenwald@bloomberg.net.