Size Matters (Post-Part 108 NPRM Edition)-The Group 1–3 UAS Business Case Differentiators
- nernst03
- Aug 29
- 5 min read
Updated: Sep 7
With the FAA’s long-anticipated Part 108 NPRM upon us, the conversation around unmanned aircraft systems (UAS) has fundamentally changed. For the first time, the regulatory door is opening to routine operations with Group 2 and Group 3 aircraft (outside of Part 91, 44807, or Special Airworthiness). For operators who have long been constrained to small UAS under Part 107, this is a seismic policy shift.
However, it’s critical to recognize the fine print: regardless of Group, Part 108 proposes to cap operations at below 400 feet AGL. This ceiling creates both opportunity and limitation—allowing larger, more capable platforms into lower commercial airspace, but not allowing such aircraft above 400 feet.
With this evolution, the demand for heavier, more advanced UAS platforms will naturally increase. However, these systems come with greater complexity and higher costs. One of the most important, yet often misunderstood, considerations is how to strategically select the best system—Group 1, 2, or 3 UAS—for particular operations. While technical specs and mission capability may be the more obvious differentiators, the most important one comes down to the actual business case—the costs and operational constraints—for selecting one group of drone type over another.
Now more than ever, understanding the practical, business-driven implications of UAS group selection can make—or break—your UAS program.
Understanding the Groups: A Quick Primer
While the commercial UAS space does not have a formal classification system beyond basic weight limits, the U.S. Department of Defense (DoD) has long relied on a well-defined structure: the UAS Group category chart.
Though designed for military use, the DoD UAS Group classification has become a de facto reference point across both government and industry sectors, helping to communicate the relative size, capabilities, and applications of different UAS (groups). The DoD UAS Group chart categorizes unmanned aerial systems into five distinct groups, primarily based on three technical factors:
Maximum Gross Takeoff Weight (MGTOW)
Operating Altitude
Airspeed
Group 1 includes small UAS (sUAS) typically used for short-range reconnaissance, surveillance, and commercial uses. These drones are often battery-powered, hand-launched, and do not require runways. Commercial sUAS operated under FAA Part 107 fall within Group 1.
Group 2 drones offer more endurance and payload capacity. These are typically used by longer missions than what Group 1 UAS are capable of or heavier payload requirements. They often require some form of launch/recovery system.
Group 3 UAS bridges the gap between tactical UAS and larger strategic systems. They are capable of long-endurance missions and may require more complex launch and control infrastructure.
Group 4 UAS represent a major jump in strategic capability, supporting long-endurance surveillance. These UAS are highly integrated into airspace management systems and can fly for 24 hours or more.
Group 5 drones are considered the most advanced and complex UAS platforms in existence, capable of sustained, high-altitude operations across continents. These systems are often equipped with multi-sensor payloads and sophisticated avionics.
“Is the juice (business case) worth the squeeze?”
Business Model Implication: Group 1 vs. 2 & 3
Group 1 platforms work best for high-volume, localized operations. If you're scaling an inspection business that relies on deploying multiple teams across sites—like utilities or telecom—you’ll benefit from the low cost, easy licensing, and minimal regulatory burden. However, there is an economy of scale at which point Group 1 (sUAS) loses relevance.
Group 2 platforms are typically much more complex than Group 1 aircraft. Operators must be able to justify a business case for the expense of capital, training, competency, and regulatory compliance, versus operational benefits. For example, enterprise customers with large geographic footprints, Group 2 UAS can slash data acquisition timelines—but is the expensive learning curve worth it?
With an even greater amount of operating complexity (and direct capital expense), Group 3 platforms can operate higher and longer than Group 2 platforms. However, most commercial operators in the National Airspace are not equipped to operate these types of systems (yet). This group enables capabilities that are not possible with lighter drones. While breaking into this category is a true differentiator, it will be an incredibly expensive and untimely endeavor. Is the juice (business case) worth the squeeze?
“It’s critical not to get overly fixated on the Group classification of UAS at the outset.”
Choosing the Right Path Forward
To have a viable UAS program, your regulatory alignment, technical performance assessment, and business return on investment (ROI) analysis must guide the decision UAS group selection. An aircraft’s group classification will drive your:
Capital and operational costs - On average, a Group 1 UAS could cost between $3,000 and $40,000. A respectable Group 2 UAS can cost between $75,000 - $250,000. Group 3 UAS start at a general price point of >$250,000.
Crew training and safety case requirements - Operators typical undergo autopilot-specific training, and maintain a pilot’s currency schedule that closely mirrors manned aviation.
Insurance and risk profile - Insurance companies will insure Group 2 & 3 operations, but this needs to be viewed from the perspective of boutique service. Finding a reputable carrier is not trivial today, as these types of operations are not common just yet. That will inevitably change as more operators begin to utilize these groups of UAS.
Begin with the business case: what is the ultimate deliverable your operation needs to achieve? Once you've defined that, move to the payload—what equipment or capability must the UAS carry to meet your mission objectives? From there, establish your Concept of Operations (CONOPS), which will naturally guide you toward the most suitable Group category.
“Without a clear and well-defined strategy, your UAS program risks failing.”
Final Thought
