The UAS Fund, a $2.2 billion private-sector investment pool incorporated last year by NEXA Capital Partners in Washington D.C., has filed a formal rule-making proposal with the FAA supplying a proposed regulation governing the use of extremely small drones weighing less than three pounds. The idea? While the FAA remains bogged down in the complexities inherent in making America's airspace safe for drones of all sizes, allow so-called "micro unmanned aircraft"--mUA for short--to begin flying in a commercial capacity in the near term. Doing so is relatively risk-free, UAS Fund representatives say, and would allow the unmanned systems industry to unleash the myriad benefits of drones on U.S. business. It would also set in motion the billions of dollars in economic impact that drones are expected to deliver when they are finally cleared for commercial use.

"Our view is that our micro unmanned aircraft rule is a no-brainer from an economic development perspective because it can be immediately implemented and start unlocking economic benefits today," says UAS Fund president Matthew Bieschke. "Moving away from the burdensome process that's in place right now will allow some of the economic benefits to be realized today, long before the small UAS rule gets worked out."

The "small UAS rule" currently under development by the FAA would apply to all drones weighing 55 pounds or less, regardless of size, application, or type of aircraft. A draft version of these regulations was supposed to be handed down by the end of 2014 and a final set of rules put in place by the end of 2015. But by their own admission, regulators have had a hard time developing a set of regulations that reasonably apply across all sizes and classes of unmanned aircraft.

As a result, the FAA's blanket ban on commercial drone use remains in effect, the only exceptions being a few companies that have managed to secure exemptions from the FAA through a lengthy application process. Last week the FAA granted two more exemptions, one to a precision agriculture company and the other to a real estate firm, bringing the total number of companies allowed to use drones for commercial purposes to 13. (More than 200 applications are pending.) The proposed mUA rule would create a general regulation that would allow anyone to commercially operate drones weighing less than three pounds without securing an application-specific exemption from the FAA.

The proposed rule also reflects the a growing sentiment among drone advocates in and outside the industry that regulating a two-pound, battery-powered quadrotor and a 50-pound, gas-powered behemoth in the same way is not only nonsensical, but quite difficult for the FAA to do in a manner that's not burdensome for both businesses and authorities.

"We don't think starting with a 55-pound rule is the way to go," Bieschke says. "We think the best way to do this is to start with this category first and then build on that. We need to start somewhere. We need to crawl before we walk, and walk before we run."

The mUA rule proposal argues that allowing drones three-pounds and lighter into the airspace first makes sense because according to the FAA's own data, objects of that size pose no threat to manned aviation. The mUA proposal comes complete with a safety study compiled by a third-party engineering firm based largely upon FAA on bird strikes within the general aviation industry. While data concerning actual collisions between manned aircraft and drones is virtually nonexistent, the study concludes that in the last 25 years there have been no injuries or deaths resulting from manned aircraft colliding with small- or medium-sized birds (those weighing less than 3.8 pounds) despite the presence of 10 billion birds in U.S. skies.

Therefore, the study concludes, mUA operated by experienced pilots in accordance with existing drone regulations--which dictate that unmanned aircraft operate below a ceiling of 400 feet and at least five miles away from airports--pose no threat to manned aviation. Nor should they pose an unreasonable threat to persons on the ground. And with safety concerns put to rest, there's no reason to prohibit companies from taking advantage of the valuable data and imagery that even this smallest class of drones can provide.

For the drone industry and companies anxious to integrate drones into their operations, the proposed mUA rule provides something else that could be far more important in the long term: a foot in the door. The proposed mUA rule isn't designed to be a "one-and-done" solution, Bieschke says, but the first step toward creating smart and safe regulations around larger classes of unmanned aircraft. "We personally--the UAS Fund--don't really have a lot to gain from a three-pound rule," he says. "We just want to promote commercialization here, to jump-start the industry and get us moving in the right direction here in the United States rather than sit here and watch all these companies go overseas or to Canada."

Trimble Navigation Ltd, VDOS Global LLC, Clayco Inc and Woolpert Inc said in their petitions to the FAA that they would operate drones weighing less than 55 pounds (25 kg) and keep them within view at all times.

The approvals broaden the uses of commercial drones to include aerial surveying, construction site monitoring and oil rig flare stack inspections. Previous FAA exemptions were for aerial photography by seven television and film companies.

The FAA is expected to release a draft rule on drones by the end of December. The latest approvals came as the FAA and other industry officials were questioned by Congress on Wednesday about the safety and benefits of drone use.

The FAA has been under mounting pressure from companies seeking to employ drones to survey crops, inspect remote power lines and pipelines or deliver packages, or other uses.

The U.S. drone industry is expected to generate $13.6 billion in economic activity and create 70,000 jobs in the three years after commercial use restrictions are lifted, according to the Association for Unmanned Vehicle Systems International.

The FAA bans most commercial drone flights, but is required by Congress to integrate drones into the U.S. airspace by September 2015.

Capt. Lee Moak, president of the Air Line Pilots Association, brought a small quad-copter to a House aviation subcommittee hearing on Wednesday that he noted was capable of flying at 6,600 feet for 15 minutes.

“That means it could easily end up in the same airspace I occupy when I am on approach to land at Newark,Seattle, or any other airport,” he said, noting increased reports of drone sightings by pilots.

He urged the FAA not to allow pressure to rapidly integrate drones into the national airspace and compromise safety.

But others pressed for much more rapid FAA action. Rep. Roger Williams, a Texas Republican, said Amazon.com has had difficulty getting FAA permission for outdoor tests of package delivery in Washington state. Amazon told the FAA this week it has begun testing outside the United States because of the restrictions.

The FAA’s associate safety administrator, Peggy Gilligan, said the agency knows Amazon is unsatisfied and expects to “reach some conclusions shortly” on its application for an exemption.

By Kate Taylor, Entrepreneur.com

We should have known that the mixture of mistletoe, drones and $10 endless appetizers would only lead to bloodshed.

A TGI Friday’s mistletoe drone wreaked havoc at a Brooklyn, N.Y., restaurant last Thursday when the drone accidently slammed into a photographer’s face.

The incident began when a drone operator attempted to land the drone on a reporter’s hand, according to the Brooklyn Daily. The reporter flinched, sending the drone careening into the face of Georgine Benvenuto, a photographer who was there to take photos for the Brooklyn Daily. The mistletoe then apparently became caught in Benvenuto’s hair, causing further damage to her nose and chin as the drone’s blades continued to spin.

“I have covered active crime scenes, terrorist strikes, etc. and survived them all, unscathed,” Benvenuto, who walked away with a bloodied nose and chin, wrote on her Facebook page. “The most dangerous assignment to date was covering this drone story.”

“This was an isolated event during a demonstration for the reporter and photographer only, given by the licensed operator of the drone during the last day of this particular promotion,” TGI Friday’s said in a statement to Entrepreneur. “Of course, safety is our first priority and we are sorry that this isolated incident occurred.”

The restaurant industry’s drone drama is likely only beginning. Companies from grilled cheese maker Jafflechutes to Lakemaid brewery have experimented with drones, primarily for deliveries. Now that mistletoe drones have revealed a new festive and destructive way for restaurants to use the flying contraptions, who knows what else foodie drones are capable of?

Related from Entrepreneur:

TGI Fridays Is Putting ‘Mistletoe Drones’ in Restaurants

Inside the Semi-Secret Meeting That’s Reshaping America’s Drone Industry

Smart Retailers Know There Is Plenty of Action After the Holidays

The U.S. online retailer has already started conducting outdoor tests “in other countries with regulatory environments more supportive of small (unmanned aircraft systems) innovation,” according to the letter written by Amazon vice president of global public policy Paul Misener.

Amazon says outdoor testing is crucial to developing its “Prime Air” program, which aims to use drones – small unmanned aircraft – to deliver packages in 30 minutes or less. It said it preferred to keep that testing within theUnited States.

In July, Amazon sought permission from the FAA to test drones in outdoor areas near Seattle, where one of its research and development labs is working on the technology, but the FAA has been slow to give its approval.

“Without approval of our testing in the United States, we will be forced to continue expanding our Prime Air R&D footprint abroad,” Misener wrote in the letter, first reported by The Wall Street Journal.

Drones are among several initiatives underway at Amazon to help control rising shipping costs and compete with brick-and-mortar stores by delivering items quickly. Amazon said there were dozens of U.S. job openings for its Prime Air division for hardware engineers and research scientists.

Last year, the U.S. government created six sites for companies, universities and others to test drones for broader commercial use. The area near Seattle where Amazon wants to conduct its tests is not among those sites, and Amazon said it would be impractical for “it to pursue the test sites as our sole method of testing at this time.”

Jenkins is a well-known personality in the aerospace and aviation realms. He's been in the room for more or less every major airline merger and bankruptcy restructuring over the past few decades. He's spent his career lecturing to and on the aerospace industry, having taught for several semesters at George Washington University while publishing countless papers and research reports as well as one book on the industry. He's the guy that goes on Bloomberg TV and CNBC to explain these things to the world. Jenkins knows a whole lot of influential people in the aviation and aerospace worlds. A lot of those people are here at Robofest today. They, like Jenkins, share a keen interest in the next generation of aerospace technology--the various unmanned aerial systems commonly and collectively known as drones.

It’s a pitch-perfect afternoon in late October when Robofest takes place. The setting is Jenkins’ secluded home in the Shenandoah foothills. This year’s event is the second in two years, already known as an off-the-record social date that is evolving into an industry movement that Jenkins hopes will pave the way forward for the burgeoning commercial drone industry. (Fortune obtained special permission to write about the event.) On the agenda: An open discussion on how to best move the industry forward, and--of course--a bit of drone flying. But first, there's wine and then lunch. No one wants to reshape an entire industry on an empty stomach.

Last year's Robofest was mostly a recreational and social affair, Jenkins says. This year--with some of the more influential minds within the industry, state and federal government, and academia all gathered on his back patio--Jenkins wants to do more than just talk about what can be done. The drone industry largely sees itself as hamstrung by an overreaching and underfunded Federal Aviation Administration. The industry believes it is increasingly outgunned by foreign competitors operating in more permissive regulatory environments. Jenkins and his assembled cast of industry veterans, lawyers, entrepreneurs, lobbyists, and government insiders want to change that.

"When I think about all the airline mergers and bankruptcies I've been through with this industry, I feel like an old man," Jenkins says, calling his 80 or so guests to order. "When I think about UAS technology, I'm 16 again." As his guests finish tucking into plates of fried chicken and pasta salad, Jenkins reminds his guests that the point of this gathering is not to sit around throwing rocks at the FAA, an activity that has become an organized sport for advocates of a commercialized drone industry. Today is about hammering out some concrete steps that the industry can take in the near term. It’s about keeping the industry marching forward despite bureaucratic inertia.

Jenkins turns the floor over to his keynote speaker, the former CEO of a major Fortune 500 aerospace and defense company and vocal supporter of the drone industry. His comments set off a spirited discussion about what the industry needs, how it can nudge the FAA in the right direction, and--most importantly--what the industry can do on its own without help from the FAA. (The theme of this year's Robofest: "Doing it Ourselves.")

No single voice or interest dominates the discussion. Among those that speak up are academics, former FAA officials, aerospace industry executives, drone entrepreneurs looking to build new companies around UAS technologies and services, local law enforcement, and U.S. intelligence employees. One is a lawyer who specializes in the nascent new practice of drone law. Another represents the newly formed D.C. drone lobby backed by Google GOOG and Amazon AMZN . There are even realtors interested in using drones for aerial photography, which is currently prohibited by the FAA, and a sailing coach interested in applying drones to maritime sport.

Above all, there is money present. Representatives of a $2.2 billion investment fund aimed specifically at drone infrastructure--such as air traffic control technologies to allow drones to safely operate alongside conventional aircraft in U.S. airspace--weigh in during the discussion. For more than an hour the discussion ping-pongs around Jenkins' crowded, sun-dappled patio.

There is disagreement but also plenty of consensus. The large drone industry is well represented on Capitol Hill through the defense and aerospace industries, but the small UAS industry--representing aircraft that weigh less than 55 lbs.--needs to better organize and represent itself, the group agrees. Small UAS need size-specific regulations so that a five-pound drone flying at 300 feet is treated differently than a large drone. And most of all, the industry needs to work with the FAA, rather than rail against it--otherwise, little progress will occur.

Jenkins closes the discussion by informing his guests that this will be the last Robofest held at his home. Though it’s only the second such event, it's already straining the capacity of his generous patio space. Jenkins says he’s working with universities in the D.C. area to formalize and host the next event sometime in early 2016. The plan: bring today’s agenda to a much larger audience. It would be a mistake to wait any longer, he says.

"We're at an inflection point," says one self-described serial entrepreneur who launched and sold four technology companies. He's traveled to Robofest from Michigan to hear what others in the industry have to say and for the chance to swap business cards and make a few new contacts in the industry. Naturally, his latest startup is a drone company, one that would provide drone products and services as well as training and certification for pilots--as soon as standards for such certification are codified by the FAA, that is. "There's still a lot of uncertainty," he says. "But the time for this industry is now."

The sun is getting low now and the breeze has died down--it’s finally time to fly. From car trunks and duffel bags and hard plastic carrying cases, out come the drones--from small quad-rotors to massive eight-armed octo-copters in varying shapes and sizes. The entire gathering looks on as one machine after another rises into the sky. In minutes, everyone is 16 again.

The multi-rotor helicopters, priced between $500 and $1,000, will go on sale late next year, the Journal said.

GoPro was not immediately available for comment.

The company already provides the cameras used in many drones.

Such limiting regulations would preclude drone use for highly-touted applications like pipeline inspection and large-scale crop monitoring. Beyond that, last week's ruling in favor of the FAA means that drones of all sizes will be covered under the regulations. Photography drones weighing less than five pounds, such as the now ubiquitous DJI Phantom series quadrotor, will likely be regulated the same way as much larger, gas-powered drones like Boeing's 40-pound ScanEagle, which is used by militaries and private industry for sophisticated missions.

The news is a setback for those hoping that, based on a prior NTSB ruling finding against the FAA, small drones weighing less than 10 lbs. (including DJI's Phantom and 3D Robotics IRIS) would not be held to the same standards as other aircraft the FAA regulates.

The idea that small drones might not be regulated as "aircraft" by FAA definition stems from a case in which a drone operator named Raphael Pirker was fined $10,000 by the FAA for using a small, styrofoam drone to gather footage for a University of Virginia Medical School advertisement, a service for which he charged a fee. While the transaction ran afoul of the FAA's near-universal ban on using drones for commercial gain in the U.S., the FAA chose to cite Pirker for flying recklessly. An NTSB judge threw out the case in March on grounds that the FAA had not previously regulated model RC aircraft like the one flown by Pirker and had no grounds to do so now. Pirker's flight also took place before the passing of the 2012 FAA reauthorization bill by Congress, which mandated the FAA to safely integrate unmanned aircraft into the national airspace. (A draft rule on more sweeping drone regulations is expected before the end of the year.)

The Pirker ruling led many to believe that small drones wouldn't be regulated the same way as larger small drones--unmanned aerial systems typically defined as those weighing less than 55 pounds. But the FAA has since taken action to clarify its own rules toward small drones, and last week's overturning of the Pirker decision further solidifies is position as the authority that will regulate all unmanned aerial systems as the commercial drone industry attempts to take off. It's also another shot across the bow to those attempting to fly under the FAA's radar as they use drones to commercial ends.

"A lot of people like to insinuate that there's a grey area with the law: 'What I'm doing doesn't break any FAA rules because I'm not charging for my flight,'" says Patrick Egan, an editor at sUAS News and drone industry advocate. "These are the shadows that people like to hide in. With the NTSB ruling, the gray areas had some light thrown on them."

Coupled with the rumors trickling out of the government concerning the proposed regulations, the ruling has proven troubling for many in the industry. Those who thought that small UAS might not be regulated by the FAA, or that they would be regulated different from larger, more complicated, and potentially more dangerous drones are facing a regulatory future in which very small drones and larger drones are treated alike.

"Where do you draw the line in terms of which UAS are regulated and which are not?" says John McGraw, an aerospace industry consultant and former FAA flight standards official. "The NTSB hasn't said, but it has affirmed that the FAA has pretty broad authority to draw that line."

But such rules would also likely require a change in FAA structure and mission, which could be difficult given the agency's current funding and manpower.

"After rules are issued, people are going to gravitate toward compliance with the law," Egan says. "They'll want to build businesses. But the FAA has a problem right now. It's a double-edged sword with the NTSB ruling. You want to regulate toys? Well, now you're regulating toys. If that's going to be your deal, you're going to have to evolve into being some kind of consumer safety organization and get down to the Toys ‘R’ Us level. I don't know how they're going to do that."

Of course, the NTSB ruling doesn't require the FAA to regulate every single aircraft, large or small, that takes to the airspace. However, it does give the agency the leeway to do so. If the proposed rules that leaked to the Journal this weekend are in fact a real barometer of the agency's thinking, it suggests that the FAA will indeed have the power to regulate small drones the same as large ones and may do so. But how that will carry through to the practice of enforcement is yet another matter for the FAA to determine, and in that light the NTSB decision could have more symbolic than practical impact.

"[The ruling] just reaffirms what the FAA thinks was its authority all along," McGraw says. "It's not a shift in position for them. And it's not their intent to regulate paper airplanes."

Happy Monday. It’s a holiday-shortened Thanksgiving week, but there’s still plenty of news happening. Today, markets are up in Europe and Asia, and U.S. stocks look set to move higher as they come off five straight weeks of gains. We’ve also got news of a possible collaboration between upstart Tesla and one of the automotive old guard. Here’s what else you need to know about.

1. Time is running out for an Iran deal

With a deadline set to expire today, it looks unlikely that negotiators will reach an accord on Iran’s nuclear ambitions, the BBC reports. This would mean that talks would break off until December. In recent days, there has been some skepticism that a deal could be approved by legislators in Tehran and Washington, even if negotiators reach some accord.

2. Watch out, amateur drone operators

New federal rules on commercial drones are expected to require operators to hold a license, limit flights to daylight hours, fly below 400 feet and within sight of the person at the controls, according to The Wall Street Journal.

3. Tesla cozies up to BMW

Elon Musk told a German auto magazine that his electric car manufacturer Tesla TSLA is talking to BMW about collaborating on batteries and parts. Though the talks are said to be informal, its always interesting to see famed “disrupter” Musk working with part of the auto industry elite.

4. Samsung shakeup

According to The Wall Street Journal, beleaguered tech company Samsung is considering making some changes to leadership. This could mean shifting current co-CEO and mobile division leaders J.K. Shin out of both roles. The Korean company’s smartphone business has been badly hurt in recent years.

5. May the box office be ever in your favor

“Mockingjay -- Part 1,” the latest installment of the Hunger Games movie series, was released this weekend and brought in $124 million, this biggest opening weekend of the year. This hasn’t been a great year for the film industry, with the Jennifer Lawrence-led dystopia being one of the few bright spots.

By Dan Kedmey, TIME

The Federal Aviation Administration is set to restrict use of drones to within 400 feet of the ground and forbid flights beyond the eyesight of the operator, according to a new report, rules far less permissive than what companies like Amazon had hoped for.

The Wall Street Journal, citing unnamed sources familiar with the highly anticipated ruling, reports that drone operators will be expected to obtain a pilot license, which traditionally require hours of flight training.

Read more at the Wall Street Journal

By Victor Luckerson, TIME

It seems Amazon is getting serious about delivering packages to its customers via drone.

The e-tailer has posted a job listing for a flight operations engineer on its Amazon Prime Air drone delivery team. The new job, based at Amazon's Seattle headquarters, will involve working with regulatory authorities, planning out test flights and executing the flights themselves. Several years of flight test experience are required for the job.

The company is also seeking a flight safety manager to work on the same program.

“I want to get a company from ‘crazy’ to ‘viable,'” Johnson told Fortune. “With today’s technology, we can now create in days, weeks or months what previous generations couldn’t do in a lifetime. Where DaVinci could sketch, we can build. Yet, we don’t have sufficient resources and people pursuing these goals.”

On Monday, Johnson, who is best known as a founder of online payment processing company Braintree, announced that he has created a $100 million fund to invest in start-ups working on outlandish projects.

He has already invested $15 million in seven startups. Planetary Resources, one of those companies, wants to spark an interstellar gold rush by mining asteroids for precious metals. Another called Vicarious wants to build a computer system that learns like the human brain. Human Longevity aims to lengthen the human life span to 120 years. Meanwhile, Matternet is fine-tuning a new kind of $3,000 drone for emerging markets and third-world countries.

For every startup Johnson funds, he turns away many more -- at least 95% of the ones he sees.

“I invest in entrepreneurs who understand generally where the world is going, the enormous power of their tools and the enormous stakes that we have,” he says.

In Matternet’s case, the Palo Alto startup certainly didn’t invent drones, but the company may be the first targeting the developing world. “You can’t get critical supplies to parts of Africa and Asia today -- the roads are just too bad,” explains Johnson.

Matternet CEO Andreas Raptopoulous contends people who will benefit most from drones won’t be Amazon customers (sorry, Jeff Bezos), but those who need food, medicine and other basic necessities in hard-to-reach places like Bhutan, where Matternet has already experimented with a prototype capable of traveling 15 miles carrying 4.4 lbs. of cargo. A 7.5 mile drive from Bhutan’s capital of Thimpu to a remote spot takes a car between 1 and 4 hours depending on weather and road conditions, but a Matternet drone accomplished the same trip in 14 minutes.

Promising as ventures like Matternet are, Johnson recognizes he’s taking a serious risk as an investor. There’s little-to-no guarantee any of the startups he invests in will make it big. “It’s much harder to vet the likelihood of these companies than it is a web startup,” he admits. “You may have a 1 in 10 hit rate for someone building software for something. Here, you have a hit rate of 1 in 100 or 1 in 1,000.”

That Johnson is plowing ahead anyway isn’t surprising to those who know him well. By the time he was nine, Johnson showed a penchant for exploration, traipsing the woods in and around Springville, Utah, where he grew up.

“I think it's the culmination of what he's been working for his whole life,” says Candace Mouritsen, Johnson’s sister and an early employee at several of her brother’s startups.

Rather than chase after his own interstellar dreams, Johnson became an entrepreneur. Two startups, including an Internet voice business, went bust by 2003. Two or three years later, Johnson drummed up the idea for a credit card processing system aimed at high-tech merchants. The smartphone market was in its infancy, and the credit industry then was plagued with what Johnson calls “unscrupulous” competitors.

So he left his job working in a strategy group at Sears SHLD and started Braintree. Six years later, Braintree was processing $12 billion a year in payments from clients including Uber, Airbnb and OpenTable. The business was doing well enough such that suitors came knocking, and in the fall of 2013, PayPal acquired Braintree for $800 million.

Now Johnson plans to use $100 million of his own cash for OS Fund, a name he coined that refers to the technical term “operating system.” Kitschy as it may sound to some, he wants to invest in startups developing products and services that radically improve quality of life. So when Johnson refers to the OS Fund, he’s not talking about some computer operating system, but what he dubs the “operating system of life.”

If his investments seem unusual and far-flung, it’s with reason: Johnson avoids startups that are more bent on commercial success than addressing deeper societal challenges. And if Johnson comes across as downright eccentric because of his fund, so be it. He’ll also be in good company for now, joining a group of forward-thinkers behind Tesla TSLA , the high-performance electric carmaker, and Google’s GOOG research lab Google X, known for working on sci-fi projects like self-driving cars and glucose-tracking contact lenses.

"I think the winds will shift,” Johnson says. “There will be a shift in the kinds of things people aspire to do. Funding and supporting hard problems will become cool in a company in a couple of years.”

Spoken like a true futurist.

By Catherine Clifford, Entrepreneur.com

If "a rose by any other name would smell as sweet," then a drone by any other name would still be a remote-controlled flying vehicle. And yet there is quite the kerfuffle over how to refer to these aerial devices.

One thing is clear: Many in the industry prefer to stay away from "drone." The trade group representing drone technology — which is been used in everything from military combat to Amazon special delivery beta-testing to photography — is called The Association for Unmanned Vehicle Systems International. The Federal Aviation Administration, the government body tasked with regulating U.S. airspace, calls drones unmanned aircraft systems, or UAS for short. As does the army. The navy has used the term unmanned aerial vehicle, or UAV for short.

The debate over what to call these flying vehicles was brought to light in a Wall Street Journal article published today. The main argument against "drone" is that it makes people think only of the technology's militaristic uses, despite it having other applications.

Alternatives for the word drone mentioned by the Journal include "crone," "remotely piloted aircraft," and "unmanned aircraft." Some aerospaces companies name their drones based on however many propellers they have, so they'll name a "quadcopter" for a drone with four propellers and an "octocopter" for one with eight.

What do you think? Leave a comment below and tell us how you feel about the word "drone." If you are not a fan, what's the best alternative and why?

But I’d like to think it’s about drones. And, if so, it picked a historically wonderful spot.

I admittedly have no idea if Amazon has roof access as part of this lease, but let’s imagine that it does. And let’s also imagine that all of the regulatory and technological logistics are somehow overcome. If so, Amazon would have a drone hub right across the street from a building that originally was designed to serve as a docking station for dirigibles and related airships. You know, the Empire State Building.

When the Empire State Building was constructed, it included a mooring mast that was designed to let light airships dock. It also was supposed to include a small bridge that would allow people to board and disembark from the 102nd floor. Why fly into an outer borough when you can land directly in Midtown Manhattan?

Unfortunately, the docking station never really worked. The main problem seemed to be updraft around the building combined with the fact that the only mooring was too the building itself (i.e., no additional ties to the ground). One airship did manage to connect for a few minutes while several others came close, and then came the Hindenburg disaster. So the plan eventually was scrapped — and the mooring tower was used as a base for radio and television antennas.

Amazon obviously isn’t looking to ferry around people, but perhaps today’s news means that the company may help Manhattan realize its nearly century-old dream of putting an aerospace hub at 34th and 5th.

Sure, it’s more likely that Jeff Bezos simply wants more people to see his smartphones. But I’ll root for practical ambition over staid marketing.

Sign up for Dan’s free newsletter on deals and dealmakers: Get Term Sheet

The Pocket Drone--a collapsible, three-rotor aerial vehicle--folds up small enough to fit in a backpack easily, but its three independent propeller motors are powerful enough to carry a GoPro camera. Johnson and his partners think it could be the first in a huge, new category of personal electronics--the small, easily portable flying robot that goes everywhere with you to capture overhead imagery on demand.

In a few swift motions, Johnson snaps the rotors into place and connects the battery. Stepping back a few paces to give the machine clear passage to the airspace above, he taps in some guidance "waypoints" onto the satellite image of the park displayed on his Android tablet. Then he gives the command to fly. The propellers whir to life, and the drone zips into the air with startling speed, hovering for just a moment directly overhead before streaking off to autonomously execute its flight plan. As we watch it soar, we're updated on the drone's progress via a female robotic voice emanating from Johnson's tablet: "Waypoint one ... waypoint two ..."

Johnson's company has achieved liftoff almost as quickly as his invention. Along with co-founders Timothy Reuter, 37, and Chance Roth, 40, Johnson developed a rough prototype of the Pocket Drone and put it on Kickstarter in January. The partners were hoping to raise $35,000. But they ended up getting $929,212 in just 60 days to produce roughly 1,800 drones. Pre-orders on the AirDroids site have pushed sales still higher, to some $1.2 million. "To do a million? We felt like we really had something here, but we were definitely surprised," says Johnson, an engineering major in college who has a day job as an intellectual-property attorney. "None of us were expecting that kind of demand."

AirDroids co-founder T.J. Johnson flying the company's Pocket Drone. The Indianapolis startup has already received $1.2 million in orders for its compact UAVPhotograph by A.J. Mast for Fortune

AirDroids is just the tip of the propeller. Think of this as a Model T moment--when a new industry finds its commercial footing, and thereafter the world is never the same. The idea of unmanned aircraft as consumer devices or commercial tools is a relatively new one in the U.S. Drones, as they are more commonly known, own a place in the American public consciousness right next to the war on terrorism and America's shadow conflicts in places like Pakistan and Yemen. Predator and Reaper drones--the hulking, matte-gray unmanned aircraft now synonymous with "drone strikes"--have loitered in foreign skies for decades. But five years ago consumer drones didn't exist. Even two years ago, low-cost and easy-to-use commercial drones were largely the subject of futurism. Today the business world is on the verge of being swarmed by unmanned aircraft.

The global market for nonmilitary drones has already ballooned into a $2.5 billion industry, one that's growing 15% to 20% annually. And that's under the current law. One of the biggest potential markets for commercial drones--the U.S.--isn't even open for business yet. At least not officially. While the use of unmanned aerial vehicles (UAVs) for commercial purposes is soaring in countries like Japan, Australia, France, and the U.K., the U.S. Federal Aviation Administration has yet to institute regulations governing the operation of commercial drones, and in the meantime it has issued a blanket ban prohibiting their use in nearly all endeavors. Further complicating things is the gray area in defining the difference between "recreational" drones (which aren't restricted by the FAA) and commercial drones (which are). In September the FAA issued exceptions to six film companies to use drones, and it has approved their use to monitor oil operations in Alaska. Regulators aren't expected to issue a full set of guidelines for at least another year.

Chart Source: Frost & Sullivan

But the buildout of the drone industry is racing along even as Washington dithers. Everyone from Fortune 500 companies to venture capitalists to startups is pouring vast amounts of money into the technology. Amazon, Google, and German shipping giant DHL have made headlines by experimenting with drones for deliveries. Facebook says it is developing a drone the size of a 747 that could fly for months at a time, beaming down wireless signals. Meanwhile, unmanned aircraft have already begun to gain traction in big businesses, ranging from agriculture to mining (see box below on "Five Industries Where Drones Are Taking Off"). The industry has even recently retained a Washington, D.C., lobbyist--funded in part by Google and Amazon--to make the case for drones on Capitol Hill. So, strictly legal or not, America's drone revolution is already well underway. The question is not whether drones will have a real impact someday. Rather it's, Which businesses will be the most disrupted? And which entrepreneurs and investors will make the biggest windfalls in the process?

Mark Heynen wants to make one thing perfectly clear: "We're a data company, not a drone company," he declares moments after we meet.

Heynen is the senior vice president of client operations for San Francisco commercial-drone startup Skycatch, a company whose business model is based on the manufacture and sale of drone hardware and software to commercial customers. So in that sense, his comment may seem counterintuitive. But it's a refrain I heard repeatedly over several days while exploring the Bay Area's burgeoning drone corridor.

Over the past 18 months, a host of drone startups have sprung up amid the region's more traditional software companies. Many, like Skycatch, have recently closed major funding rounds and are starting to take on the sheen of proper Silicon Valley tech startups, moving into modern, open workspaces accented with reclaimed wood and high, exposed ceilings beneath which platoons of twenty-something coders perched at adjustable sitting/standing desks hammer away at their keyboards.

This UAV boom in the heart of techland makes a lot of sense once you realize that America's drone industry is tied up inextricably with the ongoing explosions in data analytics and the so-called Internet of things--areas that Silicon Valley and the larger technology sector have a vested interest in developing. "For us, this is just another increase in step function in the sources of information we can work with," says Aaron Levie, co-founder and CEO of enterprise cloud company Box, of the proliferation of commercial drones. "Where will the next trillion files be created? Broadly: the Internet of things. But UAVs in particular are going to be a massive source of that information."

The rotors of a Pocket Drone prototype by AirDroids fold up for easy storage.Photograph by Stephen Lewis for Fortune

Drones have the unique ability to fly lower than manned aircraft and higher than cranes and other ground-based vehicles can reach. They offer everyone from film producers to civil engineers to open-air mining operations to individual photographers a wholly new perspective on the world below. Using multispectral sensors, they can capture data impossible for the human eye to see--like gas leaking from a pipeline and food crops suffering from lack of nitrogen--faster and at greater volume than has ever been possible in the past. Tapping into the ever-increasing power of the cloud, they can quickly produce high-resolution 3-D maps of vast geographic areas. It's the data that many companies are after. Drones are just the means of getting it. "If we could get this data some other way, we would," says Curt Smith, technology director for the information technology and systems office at BP, one of the only companies currently cleared by the FAA to use drones for commercial purposes in the U.S. "We do this because it allows us to do things that we couldn't do before."

Skycatch founder and CEO Christian Sanz launched his company last year after he spent two weeks using a drone he had built himself to shoot aerial photographs of a construction site. Sanz had approached the builders hoping to make a business case for drone photography, and it turned out they had a voracious appetite for images to track the project's progress. Sanz walked away overwhelmed by the demand for affordable, high-quality aerial images. "Two weeks into it I couldn't keep up," says Sanz, chuckling at the memory. "I was disappointing people, and I was doing it for free."

He decided to build a company around the idea of automating the process. So Sanz developed an industrial system that includes GPS-guided drones to capture imagery and automated ground stations that can charge and swap the drones' batteries between flights. By the end of 2013, Skycatch had 10 clients buying the units at $100,000 apiece. The company closed a $13 million funding round in May--investors include Google -Ventures--and Sanz says he is already working on a far more substantial Series B round.

Skycatch's customers include construction industry giants like Clayco, DPR, Bechtel, and France's Bouygues. But it also quickly found data-hungry customers in other industries such as mining (Rio Tinto) and energy (Chevron, First Solar) who are eager to exploit efficiencies made possible by regular and accessible overhead imagery and 3-D mapping. Skycatch says that it's doubling the number of systems it sells each month. Drones are no longer just an experimental extravagance to many enterprises; increasingly they're viewed as an operational necessity.

"There's an ongoing shift from a focus on cost to a focus on the value of data," says Jonathan Downey, founder and CEO of Airware, another San Francisco-based drone technology startup. Downey started Airware in 2011 to develop what amounts to a common operating system for drones--a set of software tools interfacing with an ecosystem of sensors that can be installed to make any unmanned aircraft interface-friendly with other drones within a company's fleet.

“There’s this gray area with the rules,” says one entrepreneur. “But people are going ahead and using these things.”

Like Skycatch, Airware has gained a lot of momentum over the past year, raising $11.7 million in Series A funding in 2013 from backers including Andreessen Horowitz and Google Ventures and an additional $25 million in July. Also like Skycatch, Airware just moved into nice new digs in San Francisco's SoMA neighborhood. And Airware also works with customers to apply drone technology to commercial ends. Which means, like Skycatch and almost every other company trying to develop the commercial-drone industry, Airware has a problem. As Downey says: "A [U.S.] customer can't buy our product today and be legally compliant."

In the 2012 FAA Reauthorization and Reform Act, Congress gave the FAA a mandate: Develop a process for integrating small unmanned aircraft systems (UAS) into the national airspace as well as a set of regulations to govern their use. The FAA plans to release a proposed set of rules by the end of this year, and after a period of review by industry and lawmakers the agency will issue finalized regulations sometime in the second half of next year. Drone makers are obviously eager for a resolution. Meanwhile, because the FAA lacks the manpower to police the entire national airspace at all times, many companies get away with flying their commercial drones until someone brings it to the agency's attention, at which point a cease-and-desist letter goes out.

Over the past year the status quo has changed somewhat as money and commercial interests have aligned themselves behind the commercial-drone business. In August consumer-drone makers DJI, 3D Robotics, and Parrot teamed up with Amazon to form the Small UAV Coalition, hiring D.C. lobbying group Akin Gump to represent the industry on Capitol Hill (Airware, GoPro, and GoogleX have since joined the group). Elsewhere in Washington, D.C., a consortium of institutional investors and aerospace companies has assembled a $2.2 billion fund to invest in infrastructure critical to the safe integration of commercial drones into the national airspace and to advocate for commercial drones. The UAS America Fund, as the group is known, has already filed a lawsuit challenging the FAA's blanket ban on small commercial drones with the hopes of creating some legal headroom for companies that simply want to conduct small-drone R&D flights while the FAA works on its broader regulations.

Looking down on the IRIS+ dronePhotograph by Stephen Lewis for Fortune

"The big paradox is that this is all about safety, but in order to make this safe, companies have to test," says Michael Drobac, executive director of the Small UAV Coalition and senior policy adviser at Akin Gump in Washington, D.C. "We don't want to cede the opportunities to other nations when we have such a base of companies and innovators that are already at the cutting edge in this space. Let's move forward responsibly, but let's move forward."

We can solve most of these problems with technology," Jono Millin says of the FAA's safety concerns. "We personally have the capability to solve so many of their problems."

From a hill overlooking an expanse of salt flats in Menlo Park, Calif., Millin can see the future of commercial drones. Drones of all stripes will be extremely easy to use, he believes. They'll be accessible from anywhere, no matter where they are flying. They'll be extremely safe; both the authorities and the companies that specialize in helping their customers deploy their drones will be able to monitor what drones are doing in real time. And absolutely everyone will use them. No one will be able to afford not to.

Millin is the 28-year-old co-founder and chief of product at -DroneDeploy, and along with co-founder Nick Pilkington he's brought me to the very heart of Silicon Valley--Facebook's sprawling headquarters are visible on the far side of the cracked, chalk-white flats--to see this future in action. The company flies almost weekly, Millin says, typically to give the team back in the office the chance to debug software and address issues brought up by the company's two-dozen beta customers scattered across 10 U.S. states.

Those customers are mostly companies trying to figure out how best to integrate drone technology into their operations, Millin says. Nobody wants to be left behind. "People are going ahead and doing this," he says. "There's this gray area with the rules--and it is a messy gray area--but people are going ahead and using these things."

With just nine full-time employees, DroneDeploy is still in its lean-and-scrappy phase. Its three founders launched the company out of a shared one-bedroom apartment in San Francisco. Its current office more closely resembles a loft in Bushwick, Brooklyn, than the flashy, polished workspaces that dot the surrounding area. There's no reclaimed wood to be seen, no brightly painted conference rooms full of beanbag chairs, nothing in the way of Silicon Valley swagger--just a group of twenty-somethings intensely focused on their computer screens.

FIVE INDUSTRIES WHERE DRONES ARE TAKING OFF
--Data provided by drones is transforming industries across the spectrum, often in surprising ways.

A worker for BP using a drone to image and map oilfields near Prudhoe Bay, AlaskaPhoto courtesy of AeroVironment

Unmanned aircraft have long promised to provide critical information and unlock efficiencies across industries, but we're only beginning to see just how large an impact that data can have as companies find new and often unexpected applications for drone technology. "This usually starts when people perceive the benefit of not hiring an aircraft for something," says Mark Heynen, senior vice president of client operations at commercial-drone maker Skycatch. "But it quickly trickles into other places." --C.D

Agriculture: / New sensors and data analytics are taking precision agriculture beyond simply monitoring crops for stress. Imagine farmers boosting crop yields by optimizing the fertilizer mix for different parts of a field, or wine-makers precisely controlling drip irrigation down to the individual vine.

Construction: / On large-scale construction sites it can be extremely difficult for contractors to get the big picture. Drones make it simple for construction giants like Bechtel and DPR to monitor progress and supply stockpiles on a day-to-day basis.

Energy: / The energy industry uses drones for applications far beyond pipeline and flare stack inspection. In Alaska, BP uses drones to monitor its gravel-extraction activities to stay within environmental guidelines. ConocoPhillips has used unmanned aircraft in the Arctic, and Chevron has experimented with them as well. First Solar employs drones regularly to inspect for faulty solar panels.

Mining: / Mining giants like Rio Tinto are reducing risk to their human workforce by using drone technology to detect potential landslides and inspect safety infrastructure, as well as to keep a more accurate eye on how much mineral it extracts.

Film and Television: / Several American TV and film production companies recently received FAA clearance to fly -camera-equipped drones in U.S. airspace, offering major Hollywood studios such as 20th Century Fox and Warner Bros. the opportunity to leverage this technology on home soil--something they've done for years in other countries. Drone technology will bring much of that overseas shooting back to the U.S.

Millin, Pilkington, and CEO and co-founder Mike Winn attended high school together in their native South Africa and were scattered around various cities in the U.K. in mid-2012 when they decided that a long-simmering idea they'd shared had finally come into its time. "If we tried to build DroneDeploy five years ago, it wouldn't have been possible," Winn says. Now it appears that the timing couldn't be better.

Winn left a job building sales tools at Google while Millin and Pilkington--pursuing doctorates at the University of Edinburgh and Cambridge, respectively--abandoned their studies to develop a piece of hardware roughly the size of a deck of cards. Called a CoPilot, it's essentially a 4G/LTE wireless modem that interfaces with a drone's onboard systems, feeding data to the autopilot and offloading images and other data from the drone's sensors via existing wireless networks.

The big idea can be summed up in three words: drones as phones. By routing the control system for drones over the existing wireless communications infrastructure, DroneDeploy's technology eliminates the need for unwieldy ground stations for downloading data, say the founders. Data go directly to the cloud for processing, users can access drones from anywhere, and companies can scale their drone operations using Verizon or AT&T's infrastructure instead of buying or building their own.

Integrating drones into existing communications infrastructure is what allows Millin, Pilkington, and me to stand around eating salted almonds while a white, Styrofoam-body airframe loops back and forth across the sky overhead. Before sending the aircraft skyward, Millin dialed in the flight path from his smartphone. But twice during the half-hour flight one of the company's programmers back in the office sends us a text to let us know he's making small adjustments via DroneDeploy's dashboard software. The whole office is watching this flight and the data streaming directly from aircraft to cloud, Millin says; technically we're there only to launch and recover the drone itself.

This kind of simplicity is what will make commercial drones safe, Millin says. It would be simple enough to beam our flight plan to the FAA for approval and check it against a database of other flight plans or restricted airspace in the area. This type of automation is also what should pave the way for drones to penetrate all kinds of enterprises. While we're having a snack, the robot is compiling 10 acres' worth of high-resolution mapping data, and depending on what's being mapped, that data can be extremely valuable.

The high value of data continues to drive companies toward drone technologies, but the FAA's ban on commercial-drone use means that much of the rush toward drone adoption is happening in the shadows. Airware's Downey has plenty to say about his company's customers in Australia, France, and elsewhere in Europe, but on the subject of potential U.S. clientele he simply notes that the company is focused internationally. DroneDeploy's founders openly admit that they have users across the U.S.--companies that are experimenting with commercial-use cases for UAS technologies if not using them for direct commercial gain--but the company is not saying who those customers are. Skycatch provides technology to some of the most recognizable global brands in open-air mining, construction, and energy, and Sanz is candid about the fact that his company's technology is deployed regularly by companies right in the Bay Area, but he won't go into specifics.

“Where will the next trillion files be created?” says Box CEO Aaron Levie. “[Drones] are going to be a massive source of that information.”

Many of those companies won't have to fly under the radar much longer. As the FAA has scrambled to deal with both the proliferation of small-drone technology and pressure from various industries and interest groups to relax its commercial-drone ban, the agency has devised a mechanism that allows it to exempt specific companies and aircraft from its own rules. The first so-called Section 333 exemption was granted earlier this year when BP was given permission to fly one single kind of drone aircraft system for commer-cial purposes in the airspace over Prudhoe Bay, on Alaska's northern, Arctic shore--an exemption far too narrow in scope to really move the needle for the larger drone industry.

But in late September the FAA gave out a second exemption under Section 333, this time granting a consortium of film and television production companies permission to use a number of different drone platforms across the TV and film industries. Aside from being the first move by the FAA to open up commercial-drone use across an entire industry, it established a process within the FAA for evaluating and implementing exemptions for companies that can prove that their drone operations are safe and reliable. That bodes well for drone entrepreneurs. More than a dozen industries--ranging from construction to agriculture to energy to electric utilities--have Section 333 requests waiting in the FAA's pipeline, many of which are due for review before the end of the year.

Some drone makers are simply avoiding legal issues by exploiting demand for recreational drones, which remain largely unregulated by the FAA. Hong Kong-based DJI claims to own a full 50% of the recreational market, selling 30,000 or more of its now ubiquitous Phantom quadrotor drones every month. If DJI's claims are true, that values the consumer drone market at roughly $800 million, though some in the industry value it as high as $1 billion (the disparity arises from what one considers a "consumer drone" product).

Chris Anderson, the former editor-in-chief of Wired magazine and co-founder and CEO of Berkeley-based 3D Robotics, which last September closed on $30 million in Series B funding, is one of those who see a much larger consumer market. 3DR makes off-the-shelf drones that are designed to be customized by the user--unmanned aircraft that sit somewhere between the consumer and hobbyist spaces. The underpinning technology could be--and will be--leveraged into commercial-drone tools in the future, Anderson says. "We're seeing the convergence of the consumer and commercial markets," he says. "And consumers are leading this market in terms of technology and in terms of adoption."

Back in Indianapolis, the AirDroids drone returns from its programmed circuit and sails in for a smooth landing a few feet away. Johnson turns and shrugs, squinting into the drooping sun, almost bored. "So that's it," he says.

This story is from the October 27, 2014 issue of Fortune.

On Thursday, the Federal Aviation Administration grant a handful of television and film productions an exemption to its outright ban on the use of drones for commercial purposes. The exemption, only the second of its kind and the first of any meaningful scope, will allow those companies to employ unmanned aerial technology in their business operations even though the FAA hasn't yet settled on a larger set of rules to govern drone use in the commercial sphere. (More on that later.)

The FAA's decision is more than just a boon for Hollywood. It's a signal the commercial drone industry's long-simmering frustration with the FAA over its blanket prohibition on commercial drones could soon see some relief. Hollywood's milestone exemption could be the foot in the door that countless companies and industries have sought in their efforts to incorporate drone technologies into their day-to-day operations. And it almost certainly will serve as the model other industries use to get their own drones in the sky sooner rather than later.

How Hollywood got there first

Where commercial drone applications are concerned, one often hears of use cases in agriculture, construction, oil and gas, mining, or logging. Surprise: Hollywood, with its need to capture overhead imagery often from perspectives too low for a helicopter and too high for a crane, has been quietly pushing for legalized drone use for years. Some of the companies involved in the exemption have long been using drones for videography purposes, both overseas and in the U.S., before the murky legal framework surrounding drones forced them from the sky. The demand, however, remained.

"The studios, the production companies, they've all wanted this," says Tony Carmean, a producer and partner in production company Aerial MOB, one of the companies seeking exemption in the filing. "They claim they have more work than these seven companies can handle."

Shepherded by the Motion Picture Association of America, seven television and film production companies filed for an exemption from the FAA's general ban on commercial drones in late May under Section 333 of the FAA Modernization and Reform Act of 2012, the bill mandating the FAA to allow small drones, including commercial drones, in the nation's airspace. Section 333 exists to grant the FAA some flexibility in how it enforces its rules and allows it to grant exemptions to companies that can show very specific use cases, operations guidelines, and vehicle airworthiness to FAA officials. Until now, the FAA had granted only one exemption allowing oil giant BP BP to fly a drone in a small sliver of airspace in Prudhoe Bay, Alaska.

Hollywood's exemption is the first granted to multiple companies and the first to throw an entire industry wide open for commercial drone use. (This being Hollywood, it promises to do so quite visibly.) For companies like Carmean's Aerial MOB, the exemption is a huge relief. With the exception of some production work in Mexico City (where regulations are more lax) Aerial MOB hasn't flown its equipment in months, during which time it has turned away commercial client after commercial client.

It's a familiar story for the larger commercial drone industry: better-defined and less onerous regulations in other countries draw innovation and investment overseas, forcing U.S.-based drone manufacturers and operators to either do business elsewhere or wait out the FAA. "Unfortunately a lot of production companies are filming overseas where they can take advantage of this technology," says a film industry source familiar with the pending exemption request. "Our hope is that that this exemption will bring that production back home."

It's no accident the film and TV production industry got here first, Carmean says. By their nature, TV and film sets are closed, tightly-controlled spaces where using drones is inherently less risky. All individuals present know that cameras are rolling, rendering privacy a non-issue. And the companies that work in the space already have years of experience flying their aerial hardware. One member of the consortium seeking the exemption, Flying-Cam Inc., even won an Oscar for its technical achievements in shooting scenes for the James Bond film "Skyfall" (shot overseas, of course; remember that prolonged rooftop chase in Istanbul?).

As such, the FAA feels relatively comfortable allowing the TV and film production industry to employ drones largely because it already has been doing so for years in other countries. But however big the boon for Hollywood production companies (the six companies covered under the exemptionare Aerial MOB LLC, Snaproll Media LLC, HeliVideo Productions, RC Pro Productions Consulting LLC, Astraeus Aerial, and Pictorvision Inc.; Flying-Cam's request is still under review), the exemption should have significant implications for the drone industry at large as well as the myriad industries that will benefit from UAS technology.

Drones for everybody

News of Hollywood's exemption is heartening for the dozens of other companies from a range of industries that have also filed for Section 333 exemptions with the FAA. The agency has imposed a 120-day review period for such filings on itself, and over the next few months several exemption filings from companies across a range of industries will come to term. The fact that Hollywood got its green light bodes well.

"It's a good thing," says Tomislav Zigo, director of virtual design and construction at engineering and construction firm Clayco, which has an exemption pending that would allow engineers to survey the company's sprawling construction sites with drones. "That means we're somewhere down there in the pipeline."

Roughly 40 other companies have filed Section 333 requests–companies ranging from Amazon to BNSF Railroad to San Diego Gas and Electric–for applications that span sectors and industries. Those companies now hope that Hollywood's successful exemption will help facilitate their own requests for Section 333 requests now that the FAA has a model for evaluating the filings and regulating the exemptions it grants. The way these exemptions are regulated by the FAA also offers clues on what broader commercial drone regulations might look like once they are issued sometime later this year. "I think they're putting their toe in the water with these low-hanging fruits, and I think they're going to learn a lot and implement that into the rule-making process," Carmean says.

The FAA is expected to release proposed regulations to the industry by the end of this year and, after a period of comment, will likely implement binding regulations sometime late next year or early 2016.

According to reports, today the Federal Aviation Administration is planning on announcing approval for film production companies to use drones on closed sets, in response to seven recent requests for such permission. The Washington Post notes that these drones could replace helicopters and planes -- which are much more expensive than drones -- on film sets.

Both newsmedia groups and the Motion Picture Association of America have submitted letters in support of allowing filmmakers to use drones.

The drones would not be flown over populated areas, only on closed sets. The Post notes that the applications specify that the drones would weigh less than 55 pounds, fly no faster than 57 mph and go no higher than 400 feet.

German logistics company DHL said Wednesday it is testing drones to deliver goods -- the first time a drone has been authorized to transport goods in Europe.

L’shana tovah if you’re off work celebrating today. For those of you in the office, we’ve got a pretty newsy day. Google responded to Rupert Murdoch’s allegations, Facebook wants to fly drones and stocks are set to open mixed after the biggest one-day gain in five weeks. Here’s what else you need to know about today.

1. Will Nike's earnings be a slam-dunk?

The Oregon athletic wear company will report its quarterly earnings this afternoon, and generally analysts are expecting a good report. The problems in Russia may have taken a toll on the Nike’s NKE business overseas, but positive growth is still expected.

2. Apple will give you a new phone

If you’re one of the unlucky folks with a bent iPhone 6 Plus, Apple AAPL will replace your phone -- as long as a Genius approves it. Is this the end of Bendgate? Click here for our list of Apple’s greatest gaffes through the ages.

3. Google strikes back at Murdoch

News Corp. FOXA sent a letter critical of Google GOOG to the European Commission, so Google struck right back, posting an open letter to News Corp. Chairman Rupert Murdoch addressing the points he raised. The letter contends that “Google has done more than almost any other company to help tackle online piracy.”

4. Facebook FB drones on

The social media company is planning on using drones to bring Internet access to parts of the world where it doesn’t exist. Now, your mom can like your pictures from anywhere.

5. NutraSweet is getting out of aspartame

The sweetener used in Equal will no longer be made by NutraSweet, the AP reports. The company says foreign competition has made it impossible to compete in the aspartame market.

By Jack Linshi, TIME

German logistics company DHL said Wednesday it's testing drones to deliver supplies to the German island of Juist, in what it says is the first time a drone has been authorized to transport goods in Europe.

The drone, nicknamed the "parcelcopter," can fly up to 40mph and will deliver medication and other emergency items to the island when ferries or air travel are not operating, Reuters reports. The flights will take between 15 and 30 minutes.

The delivery system may be implemented elsewhere to deliver equipment during emergencies if the trial is successful.

DHL's drone trial follows in the footsteps of U.S. firms who are looking to test unmanned aircraft for logistics purposes. Amazon AMZN asked regulators for permission to test its "Prime Air" drone delivery system in June, while Google GOOG revealed that it was testing its own similar system two months later.

(click graphic to enlarge)

This story is from the October 6, 2014 issue of Fortune.