MaGIC-AirAsia partnership: How drones can impact the future of delivery services (VIDEO)

March 15, 2021

PETALING JAYA, March 15 — Urban drones are set to transform the delivery of goods by e-commerce platforms in the country.

This is following a partnership between AirAsia Digital and the Malaysian Global Innovation and Creativity Centre (MaGIC), the lead secretariat of the National Technology and Innovation Sandbox (NTIS).

The launch of the Urban Drone Delivery Sandbox that took place on March 6 in Cyberjaya marks the first steps towards developing the long-term viability of urban drone delivery service.

The pilot project has a six-month phase and will kick off in Cyberjaya at the third NTIS test site to assess the capability, experience, approval process, deployment readiness and service expansion of the drone operators.

Cyberjaya residents not only have a high internet penetration rate but they are consumers who are more likely to be first adopters of new technology.

The township’s urban setting of mixed development coupled with highways and laneways along with the area’s topology and terrain of hills and valleys, and hot and windy weather patterns make for a complex and challenging testing ground to prepare drone operators and regulators for a realistic environment.

The service is now in its testing stage with two homegrown drone operators VStream Revolution Sdn Bhd and Meraque Services Sdn Bhd.

Upon a successful trial phase, the service will be deployed and might expand beyond the sandbox environment.

MaGIC chief executive officer Dzuleira Abu Bakar said there is potential for drone delivery of goods to be expanded and scaled up beyond e-commerce.

As the technology improves, drones can even be used to deliver essential supplies to rural and remote areas affected by natural disasters such as floods, she said.

Instant gratification for e-commerce consumers

AirAsia Group Bhd group chief executive officer Tan Sri Tony Fernandes believes Malaysia could lead the way in drone delivery that will transform the country’s e-commerce landscape.

“It’s about instant gratification,” Fernandes said at the event.

“Can you imagine a scenario where you order something at your home on the AirAsia super app and 20 minutes later, it’s arriving in front of your house?”

He added that he had always wanted to champion drone delivery services and was glad MaGIC offered its support.

“Obviously, we are not flying much, and I have incredible, incredibly talented pilots who understand the air better than other guys, and so it was a perfect kind of marriage of using our skills sets, using our innovation, and partnering with MaGIC to get it.

“Sandboxes are important, but we’ve got to commercialise this as soon as possible, we’ve got to get the cost down, and so that we can really make Malaysia one of the first places to really commercialise drone services for delivery,” said Fernandes.

Science, Technology and Innovation (Mosti) Minister Khairy Jamaluddin said the collaboration moves drone usage outside of agricultural uses such as spraying pesticides and fertilisers into the e-commerce realm.

Drone deliveries, he said, are poised to open a new sector for drone companies as they become a part of last mile delivery for consumer items.

“So, you can imagine the use case for this is not just for food or your usual deliveries but also deliveries to places where it’s difficult to access, deliveries into interior areas, rural areas, deliveries of medicine in flood hit areas,” said Khairy, whose ministry is spearheading the initiative.

“And for Malaysians, this is just another way for us to get things faster, and hopefully we create a safe industry where people are not too concerned about drones flying overhead.”

Transforming Malaysia into a high-tech nation

The MaGIC-Airasia partnership aims to boost the trade and industrial sectors’ productivity through the adoption of advanced technology by bringing together private and public entities.

As NTIS Lead Secretariat, MaGIC’s role is to connect AirAsia with start-ups, entrepreneurs and ecosystem players as well as to advise them on the development of innovation and entrepreneurship programmes.

AirAsia on the other hand will assist MaGIC with problem statements, capacity building and market access whilst providing support and infrastructure required for the sandbox initiative.

The collaboration also seeks to drive the development of talent for Malaysia to become a high-tech nation.

This is done through upskilling local talents and moving them higher up the technology value chain to create greater socio-economic impacts.

In the wake of the Covid-19 pandemic that has affected the civil aviation industry, the airline workforce can be equipped with the necessary skills to become drone pilots and NTIS is looking to leverage their flight expertise to navigate densely populated urban centres.

Another objective is to accelerate the research and development process in collaboration with regulators and increase the commercialisation rate and innovation.

It wants to establish relationships with regulators and other stakeholders including insurers and financiers to tackle big regulatory issues related to the drone industry.

Acknowledging the additional risks that come with flying drones in cities and neighbourhoods compared to flying across oil palm estates or offshore sites, NTIS has partnered up with the Civil Aviation Authority Malaysia to test regulatory frameworks and technical parameters for drones to operate safely and efficiently.

NTIS was launched as a national solution co-ordination centre to allow innovators and start-ups to stress-test their products, services, business models and delivery mechanisms in a live environment.

Led by Mosti, NTIS is supported by secretariat members of various government agencies including MaGIC, Malaysia’s national applied research and development centre (Mimos), Technology Park Malaysia (TPM), Futurise and the Malaysian Technology Development Corporation (MTDC).

It was announced as part of the National Economic Recovery Plan (Penjana) to develop an innovation-driven economy and received RM100 million to fast-track the commercialisation of projects.