The Most Useful Machine in the Sky Is Worthless
The value in the sky was never the thing that flies.
Flying machines have been one of the great destroyers of investor capital in the history of technology. The drone economy and the flying-car boom are repeating the mistake from opposite ends, both of them chasing the one thing in the sky that was never worth owning.
The conventional view of the sky is that it is a vehicle problem. Whoever builds the best flying thing wins. Build a better drone, a better air taxi, a better electric aircraft, and the market is yours. That belief is where the capital has gone, where the splashy cover pictures have gone, and where the public companies have raised and burned their billions. It is the premise of nearly every pitch made about the future of the air.
It is also a mistake, and a very old one. The mistake is to confuse a technological triumph with an economic one. You can win completely on the technology and capture almost none of the value you create. Flying machines are the purest case of that gap in the history of capitalism, and the people now rushing into the sky are repeating it twice over: once at the cheap end, where the margin is going to zero, and once at the expensive end, where the business model is bankruptcy.
Warren Buffett said the cleanest version of this years ago. Looking at a century of aviation, he observed that a farsighted capitalist at Kitty Hawk “would have done his successors a huge favor by shooting Orville down.” He was not making a joke about the Wright brothers. He was making a point about money. Flight is one of the few technologies humanity has mastered and still failed to profit from, decade after decade.
At the cheap end, the technology wins, and the margin dies
Start with drones, because the engineering is essentially solved and the economics are already visible. A capable drone is now a commodity. DJI alone holds north of 90% of
