Brent Skorup and Eli Dourado on Airspace Auctions and Supersonic Aviation

Episode Summary

Executive Summary: Sarah Oh and Tom Leonard interview Brent Skorup and Eli Dorado on whether airspace should be allocated like spectrum, and how aviation innovation—especially eVTOLs, drones, and supersonic flight—will be governed. The discussion centers on auctions versus shared rules of the road, congestion management, FAA oversight, and the challenge of balancing safety, innovation, and property rights in low-altitude airspace.

Main Topics: Airspace as an auctionable federal asset (Priority: 5/5): Brent argues airspace should be treated like spectrum or other federal assets, with licensed exclusive aerial corridors to improve allocation and reduce congestion. Shared airspace, rules of the road, and congestion (Priority: 5/5): Eli pushes back, arguing airspace functions more like roads or commons where users follow rules and congestion is handled through tolls or demand management rather than ownership of routes. eVTOLs and urban air mobility (Priority: 4/5): The speakers discuss electric vertical takeoff and landing aircraft as the likely near-term aviation innovation, including use cases, commercialization timelines, and the role of pilots versus autonomy. Regulation, safety, and software risk (Priority: 4/5): The conversation examines how aviation differs from software: innovation is possible, but safety standards are much stricter, especially in light of the Boeing 737 Max software failures. Air traffic management and UTM governance (Priority: 4/5): They debate whether drone and air taxi traffic should rely on centralized FAA systems or federated service providers, and whether existing air traffic management can scale to new forms of aviation. Property rights, low-altitude drones, and NIMBY concerns (Priority: 3/5): They discuss who owns low-altitude airspace, how far property rights extend above land, whether local governments can regulate drones, and how to prevent NIMBY politics from blocking innovation. Supersonic aviation and the broader stagnation of flight (Priority: 3/5): Eli argues aviation has stagnated for decades and points to supersonic and hypersonic flight as major opportunities to dramatically compress travel time.

Key Arguments: Brent Skorup argues airspace can be allocated like spectrum or offshore assets through licensed corridors, especially for new aviation services such as eVTOLs. Eli Dorado argues airspace is fundamentally different from spectrum because multiple users transit overlapping segments, creating holdout and bargaining problems that make exclusive ownership impractical. Both agree that congestion and scarcity are real, but Eli favors rules of the road, tolling, and shared infrastructure over corridor ownership. eVTOLs are likely to enter first as short, high-value urban routes such as downtown-to-airport or stadium service, not immediate door-to-door flying cars. Autonomy is expected to arrive in stages: human pilots first, then remote piloting, then fully autonomous operation as regulators and customers gain confidence. Aviation has been unusually stagnant compared with software or other technologies, creating room for major gains in speed, access, and productivity. Safety must remain paramount in aviation because unlike software, failures can cost lives; the Boeing Max case illustrates how software, hardware, and oversight failures can compound. The FAA is viewed as cautious but generally open to innovation, especially when it can improve safety, mobility, and U.S. competitiveness against China. Brent warns that if airspace rights are not formalized, companies may ‘route squat’ and capture valuable corridors before the public sets fair allocation rules. Eli counters that existing aviation already uses shared corridors and separation rules, so airspace can be managed without privatizing routes. A federated UTM model could foster innovation more effectively than a single centralized system, though Brent worries it may create veto points and slow upgrades.

Data Points: Date of episode: September 18, 2019 - Opening introduction by Sarah Oh eVTOL designs worldwide: about 200 - Brent describes the number of electric vertical takeoff and landing aircraft designs under development Noise/altitude threshold discussed for drones: below 200 feet - Brent identifies this as an especially tricky zone for property rights and regulation Commercial piloted service by EHang: several months - Eli notes the Chinese drone company had been shuttling tourists in autonomous two-passenger vehicles for months Supersonic era milestone: 1969 - Eli cites the first supersonic passenger flight demonstrator flight Aviation development span from Wright brothers to supersonic: about 66 years - Eli contrasts rapid early aviation progress with later stagnation Future hypersonic threshold: Mach 5 or more - Eli uses this as the benchmark for near-global travel within four hours FAA update timeline for NextGen: since 1983 - Brent says FAA modernization has been ongoing for decades FAA workforce on NextGen: tens of thousands - Brent emphasizes the scale of personnel involved in modernizing air traffic management Urban mobility aircraft size: two to five passenger - Eli describes common eVTOL design capacity Pilotless future estimate: 15 years away - Eli suggests fully autonomous aviation is still roughly a decade-plus out Helicopter case hover altitude: 400 feet - Eli references a Supreme Court case about aerial surveillance over a backyard White House airspace restriction: 30 miles - Eli mentions a restricted zone around the White House Additional restricted zone: 15 miles - Eli mentions another airspace restriction area Airport restriction examples: 5 miles - Eli cites restrictions around Reagan National and Dulles airports

Pivotal Quotes: "I think that airspace in particular is very different from other assets we usually see auctioned off by the federal government." — Eli Dorado: Eli explains why he disagrees with Brent’s corridor-auction framing "It's a target rich environment." — Eli Dorado: Eli describes aviation regulation as a place where policy analysts can influence meaningful change "The sky is so big." — Eli Dorado: Eli argues that airspace is underutilized and can support far more drone and aviation activity

Implications: The future of aviation will hinge on how airspace is allocated and regulated. If policy favors flexible shared rules and modern traffic management, drones and air taxis may scale faster; if rights are fragmented or over-commodified, innovation could slow and incumbents may lock up valuable routes.