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UPS wants to bring drone deliveries to hospitals across the US

The shipper's new drone subsidiary, Flight Forward, will focus on urgent-need deliveries, starting with hospital lab tests.

UPS delivery drone

A UPS drone delivering lab tests at a hospital.

UPS

UPS is getting much more serious about drone deliveries -- though not quite yet to your home.

The shipping company on Tuesday said it created a new subsidiary called UPS Flight Forward to build up its young drones operations. The subsidiary is the culmination of four years of drones testing at the company, which included the development of a UPS truck outfitted with a drone launchpad and the funding of a blood-delivery service via drones in remote parts of Rwanda.

"We've done the testing, we've done the prototyping and now it's time to make it operational," Bala Ganesh, vice president of the UPS advanced technology group, said in an interview.

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Setting up a UPS hospital delivery.

UPS

Ganesh said UPS Flight Forward will start its work within sprawling hospital campuses, focusing on delivering lab samples from neighboring buildings to a central lab center. Currently, those samples can take three to four hours to arrive by ground couriers, but the drones cut that time down to minutes, UPS said.

The company said hospitals will pay it for this service, which it expects will be much faster and eventually cheaper than current couriers. In some emergency situations, UPS says, drone deliveries could even help save lives by quickly getting lab results back to doctors.

This work started in March at WakeMed's flagship hospital campus in Raleigh, North Carolina, and UPS plans to expand the service across the US to other major hospitals. At WakeMed, about 10 drone flights take place every day, with drone maker Matternet providing the drones and UPS providing logistics and health care delivery knowhow.

From there, Ganesh said the new subsidiary plans expand to other urgent-need deliveries that UPS sees as new potential profit centers. He mentioned the possibility of offering drone deliveries to factories in need of replacement parts to fix critical machinery.

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UPS' new efforts are part of a crowded field of competitors trying to develop the drone delivery market. Amazon is the best-known name in the industry, having worked for years to create home-delivery drones. It's already started piloting drone home deliveries in the UK. Google, DHL and others are also working on shipping drones.

But with the US Federal Aviation Administration still tightly restricting drone usage to only operators' line of sight, long-distance drone deliveries aren't yet available in the country. Drones are used instead for shooting on Hollywood sets and for inspections on construction sites, where drone operators can closely monitor the vehicles.

UPS' strategy appears to be notably different and more industry-focused than that of other drone developers. Ganesh emphasized the importance of focusing first on profitable and urgent-need deliveries, while the cost of drone deliveries is still high. That strategy contrasts with Amazon's work delivering books or Google delivering burritos, which are cheap products and not must-have shipments.

Ganesh said UPS is still evaluating the potential for home-delivery drones, along with other ideas, but didn't offer a timeline on when such a service may come around.

"That's going to be our first priority," he said about hospital lab deliveries. "Our goal is to take that and expand it throughout the United States."