An article in Bloombergbusinessweek (December 9,2013) titled “Why Amazon’s Going Up in the Air”, describes the announcement of plans to use drones to deliver individual items to customers within 30 minutes of placing their order. The range of these drones, carrying up to 5 lbs and travelling 10 miles from Amazon’s distribution center, would help Amazon’s competitiveness in the last mile to the customer. Current deliveries by Amazon’s own trucks face empty return miles and restricted to delivering its parcels, thus hurting competitiveness compared to UPS, FedEx and USPS. Will Amazon’s announcement itself drive down costs for drones and make their use economical ? Will customers be convinced to pay for the cost for such deliveries and will their costs beat the delivery offered using couriers ?