Another Japanese drone maker seeks to disrupt U.S. market — and it’s not Sony

Another Japanese drone maker is seeking to disrupt U.S. market — and this time around, it’s not Sony. Japanese drone maker ACSL announced today that it’s officially entering the U.S. commercial drone market, in the sense that today it’s officially opened a subsidiary in Santa Clara, California.

But even if Americans have never heard of ACSL, the drone company is hardly new, and it’s hardly small. ACSL was founded in 2013 and is today considered the largest Japanese drone maker in the country.

So what does it mean to officially be a part of the U.S. commercial drone market? In short — ability to sell NDAA-compliant drones. In Japan, ACSL is officially known as ACSL Ltd. And as of now, ACSL Ltd. has a subsidiary based in California called ACSL Inc. And ACSL Inc. has its sights set on selling “a competitively priced NDAA compliant small drone to the US market later this year,” according to a news release from the company.

What’s the big deal about the U.S. drone market?

The U.S. drone market is huge on its own. In fact, the US drone industry is estimated to be the largest in the world, already surpassing $11 billion in valuation. Roughly half of that figure is dominated by military drone applications, which demand NDAA-compliant drones.

And while the consumer side of camera drones (mostly dominated by DJI camera drones) is certainly another big swath of what’s left, an estimated 30% of the overall U.S. drone market is focused on commercial drone applications. And as of late, an overwhelming portion of those commercial drone service providers have been desperate for more choices of American made drone companies, or at least NDAA-compliant companies as well.

NDAA-compliant drones don’t necessarily mean they were made in the U.S., but it does mean that the drones don’t contain parts that were produced by certain companies that the U.S. government deems unfit to produce products for use by federal agencies. Many of the companies on the U.S. government’s NDAA-prohibited list are made in China — and yes, drone giant DJI is on the list. It all stems from fears that drones made from certain companies based in China and Russia are dangerous, particularly when it comes to how they handle customer data.

Because government contracts will only allow pilots using NDAA-compliant drones, the demand for them is unsurprisingly high. Even non-government drone jobs often simply follow the federal government’s precedent and require their contracted pilots to fly NDAA-compliant drones only.

That’s opened up a huge opportunity for companies like ACSL as well as others like Sony to make a name for themselves in the U.S. Although major Chinese manufacturers have held majority market share in the past, the National Defense Authorization Act (NDAA) ban on procurement of Chinese drones for national defense purposes in 2020 has attracted the attention of Western manufacturers in the civilian market.

In fact, just last month, Sony announced a huge leap into the enterprise drone market. In April 2023, Sony announced new updates for its Airpeak drone that transform what was initially marketed as a darling for Hollywood’s cinematographers to a key tool for enterprise applications like mapping and inspections. The Airpeak is made in Japan (it is made by Japanese camera maker Sony), and all its critical components are NDAA compliant.

Meanwhile, DJI’s enterprise drones like the Matrice line may be falling out of favor, as evidenced by the fact that DJI is focusing now more on high-quality cinema drones (most notably, the Inspire 3 drone launch in April 2023), as Hollywood filmmakers tend to not care so much about NDAA-compliance.

What to expect when ACSL lands in the U.S.

The ACSL’s entrance into the U.S. market likely isn’t too surprising — at least for folks who have been following the company closely. ACSL hinted that it was preparing to enter the U.S. market when it conducted demonstrations of its domestically produced drone “SOTEN” for several customers, including U.S. utility company General Pacific, Inc. in late 2022.

But now it’s officially here. So what will the U.S. subsidiary of ACSL be like? The company’s flagship drone will be mostly the same, but expect refinements made based on feedback from key U.S. customers.

The ACSL product lineup, including the SOTEN drone

Upon its arrival in the U.S., ACSL says it’ll primarily focus on its flagship fleet called SOTEN. The small, high-performance foldable aircraft is set to ship as an NDAA-compliant drone sometime in late 2023, and is largely known for its performance reliability and security protocols. Among the key features of the Japanese-made SOTEN drone:

• Hot-swappable camera system: ACSL claims to be the first to offer such a system in a drone, which could lend itself especially-well to critical infrastructure inspections and disaster relief efforts.
  • The primary camera captures 20-megapixel photographs and 4K video using a 1-inch sensor and a mechanical shutter.
  • The standard camera system can be hot-swapped with an EO/IR camera, multispectral camera, or an optical zoom camera.
• Strict security protocols: Collected photo and video data can be optionally encrypted before being recorded to the on-board memory card. Communication between the drone and the controller is always encrypted.
• Proprietary controller: The controller has a rich, robust autopilot.
• Solid flight times: With an estimated 25-29 minute flight time, that’s longer than the Sony Airpeak’s promised 20 minutes assuming a standard payload.
• Weather resistance: The drone has a dustproof and waterproof ability equivalent to class IP43 (though ACSL advises against flying in rain or fog, nonetheless).
• Compact size: With the standard camera and battery, the SOTEN weighs 3.8lbs.

Check out the full SOTEN drone specs sheet here.

The Japanese version of the SOTEN drone launched in late 2021 and has already seen thousands of deployments across Japanese government and enterprise customers.

That said, ACSL has a larger lineup of product offerings, which could eventually be offered in the U.S. market soon. Among the other products ACSL is working on includes a delivery drone that can transport and deliver packages of up to 2 kg.

ACSL’s U.S. leadership

With the arrival of ACSL Inc. in the U.S., the company has appointed Cynthia Huang to serve as CEO. Huang has an impressive history within the drone industry. Most recently, she served as Vice President of Enterprise Business Development at Auterion, which is the largest open-source drone software platform in the world. Prior to that, she spent nearly three years at DJI, where she last left as Director of Buiness Development, leading DJI’s North American Enterprise segment. Huang also holds an MBA from Duke University and is a member of the Commercial UAV Advisory Board.

R&D process will be led by Global CTO Chris Raabe, who previously worked at Boeing and holds a PhD in Aeronautics and Astronautics from the University of Tokyo.

“ACSL has been working hard to establish itself in its home market with a lineup that has consistently proven itself as a reliable tool that delivers results,” Raabe said in a prepared statement. “We began arranging product demos for potential US clients late last year. With the opening of our subsidiary here in California, I am making the US my base, to be personally involved in our activity in the field, meeting these clients, demonstrating our capabilities, and learning about their needs.”

The impact of ACSL in Japan

ACSL has a number of firsts to its name, including that it is the first drone-related company in the world to join the Universal Postal Union. It’s also the first company in Japan to receive Class 1 UAS Type Certificate from the Ministry of Land, Infrastructure, Transport and Tourism (MLIT). While UAS Certification is not mandatory for all flights in Japan, it is mandatory for drones flying in specific conditions, more specifically what are considered “Category III Flights.” In Japan, Category III flights include those flights beyond visual line of sight without assistance in manned areas that are flown by first-class UAV pilots

ACSL has major clients, which include the Fire and Disaster Management Agency of Japan, where ACSL’s drones provide disaster support.

Oh, and ACSL has a financial impact on Japan’s stock market, too. That’s because ACSL in 2018 became publicly listed on the Tokyo Stock Exchange (though its stock is down more than 40% year-over-year as of May 2023).

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