DJI tells us impending drone ban "is very worrying" for US customers in wide-ranging and open interview
Last week, the "Countering CCP Drones" Act was folded into a bill by the US House of Representatives that sets out policy directives for defence, meaning there is a very real threat of DJI products being banned in the USA.
I asked spoke to Adam Welsh, DJI's Head of Global Policy, to get a sense of how things got here, and where they go next for DJI customers.
Where things stand in congress...
I started by checking we agreed on the facts. "The Countering CCP Drones Act is a horrible name," notes Welsh. "We are not affiliated with the CCP, the Communist Party, or anything else, but that's sort of the hyperbolic name of the act was put forward by Representative Elise Stefanik"
The congresswoman is well-known to drone users for her anti-drone (or at least anti-Chinese drone) stance, and I have written about her before.
The question now is just how likely the ban on DJI drones is to pass into law.
As we know, Stafanik's banning law was attached to as Welsh puts it, "a must-pass piece of legislation" – the National Defense Authorization Act – which is an authorization for an appropriations bill."
Ultimately that means it has to pass some time before next year's appropriations round (which set the budgets for 2025), so there is a deadline, but it could still be months. Adam Welsh explains: "The way this works is the Senate Armed Services Committee is marking up its own version. And it's not a very transparent process.
"So they've done their markup, but they have not released a draft yet. So we do not know whether it's in the Senate version or not until after the Senate version is finally released as a draft."
"They'll basically go to what's called 'conference,' where the two versions of the bill are compared and they debate the differences. So, what it does is, if it has made it into the Senate version, it will make it much, much harder for that to be removed, particularly if the language is exactly the same."
In other words, DJI fans can hope that the Senate either (ideally) does not include the language at all or proposes different language to the amendment, which would lead to a debate:
"If there's a difference in language sometimes they decide this is too difficult for us to negotiate drop it and it falls out."
When will we know about the law?
Obviously all DJI users – and perhaps all drone users in America – want to know when the next development will happen. Traditionally October is about the time an appropriations bill aims for, which is still some time away.
Welsh appears to share my concern that being aggressive toward China for the voters means there is more risk of the ban being passed, and said: "The election atmospherics don't help at all – nobody's going to want to stand up and say this is just bad policy, right? When it could be used in an attack against them out in the election."
But, he did point out that appropriations don't always happen as soon as they can, and there is a less political period after the election. "It's possible it could pass before but being realistic all of those legislators are going to want to be out electioneering and so it may well not pass until that November to January lame duck period."
In other words, it could be a long wait, but perhaps people will be thinking less about voters when they're scrutinizing the legislation in the upper house.
Where things stand for DJI products
"A US ban wouldn't impact any of your European or UK readers obviously" said Welsh. Of our American readers, he told me very openly "They have every reason to be worried."
Since drones are a given, I ask if it'll impact DJI's other lines: "In terms of handheld cameras and other things, it's unclear whether it would impact those or not." It's notable that DJI genuinely don't know – the legislation is drafted so clumsily as not to make this clear, with 'drone' in the heading but not the very limited text.
Welsh continues "So it's unclear if it would be covered, but our drone products, enterprise and consumer, would be added to what's called the FCC covered list, and that would make it impossible for us to get the certifications we need to release new products into the US."
And existing DJI owners?
Clarifying DJI's current understanding of the proposed law, Welsh says, "So, say, for example, when there's a Mavic 4 or a new Matrice, you could be flying it in the UK; we just wouldn't be able to launch it in the US".
I try to stop thinking about the fact someone said 'Mavic 4' and remember we're here to talk about the prospect of no DJI in America.
It is Welsh's understanding that DJI would be able to continue to sell their existing fleet of products that have already been licensed. "Now it is possible that they could make it retroactive" he notes, but the language isn't definite on that and "The one thing we can say with certainty is that it would stop us from bringing new products to the market."
America the backwater!
When you're talking about a law which might not pass, it's a bit too easy to get drawn down the what-ifs and forget it might not happen, but Welsh did point out how silly the US could look:
"We would be in a ludicrous position if we had new advanced products that are being released across Europe, South America, Middle East, Africa, everywhere else, and you just had this sort of weird backwater in the US, which is supposedly the technological capital of the world, where you were either flying like a Mavic 3 from multiple years ago, or buying an American product that costs five times as much."
What does it mean for R&D?
It's a big market, and – were it to happen – not selling drones must have an impact on the rest of the world.
Welsh pointed out that while DJI crafts the best tech it can and puts it out there, the market has the ability to surprise, and that feeds the development cycle. He told me that the DJI Mini series drones had been picked up on by law enforcers as a way of getting into buildings.
"The police started using our Minis to go into houses and things like that, to look for shooters up on the landing and all these other things, things we would never consider doing, but we learned a lot from that. So anytime we are not able to test new products in a big market like the US, it's not great for us. Really not great for our users either."
Are DJI drones spying on Americans for China?
Since I've got DJI's Head of Global Policy, I feel it's only right to ask the crucial question. Most people who understand the tech know the answer already, I thought I'd ask!
"No, no, they're not. Honestly, our fundamental principle is that your data is just not our business. We just don't make money off data." That part of the answer is probably key. Welsh goes on to lay out in detail all the aspects that do use data, with an impressive level of detail.
"We have, you know, a geolocation piece of data that allows us to download maps to the app. But that's a straight pass through to our map provider, which is MapTiler, and we don't even save that data. It's randomized within five to 10 kilometers. We don't even know your exact location when you download the maps. It's a randomized location within that 5 to 10km area."
He also adds that "If you have opted to share data, you can delete it all."
What about the other accusations about DJI?
I also bring up the other accusations about DJI drones being used to abuse human rights within China. Welsh replies, matter-of-factly, "So there are allegations that our products were being used by the Xinjiang Public Security Bureau. We have, in all of our contracts, with all of our resellers, stipulations that they're not allowed to sell to any sanctioned entity, and that includes, like, even if there's not a U.S. nexus to the sale."
"We do look for red flags, and if we catch anybody making a sale that we don't approve of, or is out of the contractual obligations, we get rid of that reseller."
I speculate that it is difficult to control a drone once it has been sold and Welsh runs with it: "Yeah. I mean we only have control up to a point – it's very hard for us to stop our products getting places. As the Russia-Ukraine war broke out, we suspended sales to both sides, right? Frank, our founder, has always had a really strong belief a force for good, it’s definitely not for our products to be used for combat purposes. We are, and want to be seen, as a technology company that serves to build a better world by continuously promoting human advancement.”
Is lobbying a factor?
Welsh doesn't deny that DJI spend a good deal lobbying, though also notes "It's very clear that our competitors have put a lot of effort behind lobbying to remove us from the market. It's clear at the state level and it's clear at the federal level as well."
Tellingly, Welsh suggests that DJI isn't getting much back and forth when engaging with politicians – "We ask people to engage with us and say, if I really think there's a security issue. Tell us what the mitigations you want to see are, right? And nobody comes forward."
"There's no back and forth or legitimate give and take in those conversations, unfortunately... I do think that, unfortunately, our competitors have been quite successful in shaping the image that DJI has on Capitol Hill."
Should DJI have seen this coming?
I wonder if, in retrospect, DJI wished it'd done things differently in putting its case with US lawmakers.
"Yes, I do believe we should have gone in with more at an earlier stage. But DJI is a company that loves to put money into R&D. I think that nothing would make people at headquarters happier than if they could remove my job function and hire more people to do fun stuff with tech.
"That's the beauty of the company. That's why it's the company that it is."
The zero-sum game
One of the things that bothers me especially is that there are few obvious alternative drones to DJI in the market, and they definitely don't plug all the gaps DJI would leave. Talking a bit about how military and commercial-focused firms are seemingly pushing for laws to ban DJI – protectionism – leads to an interesting point about the size of the drone world.
"Unfortunately, right now it's a zero-sum game where everybody's they're trying to push us out of the market so they can have the market to themselves. They haven't been able to compete with us on quality. And they haven't been able to compete with us on price, certainly, because once you've got scale, like we have, we're able to be profitable at a much lower price point."
Still, Adam – and DJI – see the market as in growth (unlike the problem that GoPro faced when it hit the 'Total Addressable Market'). That said, it was interesting that the examples he gave were also enterprise and beyond visual line of sight control (remote, from a desk).
"All of this needs new laws, and that really is where a huge efficiency boom is waiting... DJI used to work on regulatory policy such as BLVOS, semi-autonomous, one-to-many, those sorts of things. And now, frankly, we are spending all our time fighting these bans. It's not what we want to be doing and I think it's just detrimental to the whole industry."
So another very legitimate worry for DJI is that it is being shut out of the development of the rules and regulations for this massive area of the drone market in a globally significant area (but yes, not the only country in the world!)
It's not over yet
To fight the ban a number of drone service and training companies have formed the Drone Advocacy Alliance. DJI is a partner, but the DAA is brand agnostic. It advocates for open markets and competition.
Welsh explains, “The DAA website is somewhere your readers can go to learn more about legislation that is trying to limit choice in the marketplace. US readers can contact their legislators through the website to make their feelings know – either via email or phone call. Emails are good, phone calls are better, but if you can actually meet your Senator or Representative in person – that is best. But please remember, be polite and tell them why a ban on DJI would be bad for you or your business.”
That seems a nice point to sign off. There are other worries on the legal agenda for sure, but speaking to DJI has left me feeling a little more optimistic about the situation.
It's good to know, for example, that for now the company expects to keep selling existing products (and it was very nice to hear the words Mavic and 4 spoken consecutively, even if just as an example).
Check our guide to the best DJI drones available, or our guide to the best camera drones where DJI's market dominance is telling too.
