Australia Post looks to drones as letter volumes fall

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Australia's Post Office Looks Into Drones

Melbourne - Australia Post has successfully field-trialled the use of drones to deliver small packages, clearing the way for test deliveries to customer homes later this year.

The state-owned corporation said the drones will be used for the delivery of online shopping parcels and time-sensitive items such as medication.

"We will put this innovative technology through its paces over the coming weeks and months to understand what it can deliver, how far it can travel, and ultimately, how our customers could receive a parcel," Australia Post Managing Director Ahmed Fahour said.

Postal services around the world are facing dramatic declines in their core letter-delivery business as customers turn to the internet for all forms of correspondence from billing to greeting cards.

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Australia Post looks to drones as letter volumes fall
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BUENOS AIRES, ARGENTINA - MAY 14: A drone remote-controlled carrying a cloth simulating a ghost with the letter B on it is seen during a second leg match between Boca Juniors and River Plate as part of round of sixteen of Copa Bridgestone Libertadores 2015 at Alberto J. Armando Stadium on May 14, 2015 in Buenos Aires, Argentina. (Photo by Amilcar Orfali/LatinContent/Getty Images)
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DURHAM, NC - FEBRUARY 25: A camera-equipped flying drone is seen prior to a game between the Virginia Tech Hokies and the Duke Blue Devils at Cameron Indoor Stadium on February 25, 2014 in Durham, North Carolina. Duke defeated Virginia Tech 66-48. (Photo by Lance King/Getty Images)
CHICAGO, IL - SEPTEMBER 7: A drone flies above the scoreboard at Wrigley Field during the seventh inning of the Chicago Cubs and Pittsburgh Pirates baseball game on September 7, 2014 in Chicago, Illinois. (Photo by Jeffrey Phelps/Getty Images)

While Australia Post is the first Australian company to get into the area of drone delivery, in the United States online retailer Amazon unveiled a drone delivery prototype in November, joining competitors GOOGL and Wal-Mart[WMTST.UL] who are also looking into the technology. .

Australia's vast interior is one of the most sparsely populated in the world, but drone delivery is unlikely to penetrate beyond the major cities: Amazon's prototype last year managed to fly a package only 15 miles (24 kms).

Australia Post last year posted a A$222 million ($171 million) loss, the company's first full-year loss posting in over 30 years and dramatic down-turn from a A$116.2 million ($89.72 million) profit in 2014. The company attributed some of the loss to a 10.3 per cent fall in the use of stamped letters.

Related: Swiss Post also trying out drones:
Swiss Post Tests Delivery Drones

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