Isn't the case still undecided?
http://www.forbes.com/sites/johngoglia/2014/04/12/faa-files-...
But even more generally, I should have said the FAA has no clear legal authority to regulate small unmanned aircraft. The FAA obviously claims that it does have certain legal abilities, and points to certain laws to argue their case [0].
[0] http://www.ainonline.com/aviation-news/2014-06-23/faa-claims...
http://www.faa.gov/news/press_releases/news_story.cfm?newsId...
Definitely agree with your second point - according to most observers, the FAA's authority to regulate small (model-sized) UAVs is tenuous at best. They're generally not expected to win their appeal.
However, the FAA's rulemaking abilities are limited by the Administrative Procedure Act (APA) and they haven't made any yet.
So, even if the FAA's appeal fails, there will be a very short window (probably a year or less) before drones are explicitly regulated on less shaky footing.
So claims the FAA. I can't make my way through the text of the law, nor can I find any legal summary or analysis other than the FAA's own claim that it gives them the authority to regulate UAS.
I find the FAA's attempt at banning anything commercial relating to drones a bit curious.
Step 1. Ban/regulate all commercial Drones.
Step 2. Require a license for commercial use.
Step 3. Profit?
This looks more like a move to kill an industry before it takes off if you pardon my pun.
Not to mention there's nothing to regulate at the moment no people have been hurt by drones and there's very few companies actually looking into them.
So the next logical question is who would loose money if commercial drone delivery services become the norm?
Really? How about people hitting baseballs with bats unregulated? That's a heck of a lot more dangerous than most hobbyist drones, perhaps unless you're deliberately trying to do harm (in which case regulations don't matter).
I suspect the true difficult technical challenge here will be upgrading the planes and airports to handle hundreds of little drones flying around, with the legal framework to follow.
Class E Airspace, that which is between the surface and 2500 feet, is unregulated for the most part (except near a commercial airport, and other such caveats). I don't know the ceiling on the drones in question, or what altitudes they intended to operate within, but if within Class E, this definitely falls under the scope of a 'new' regulation.
http://www.faa.gov/about/initiatives/uas/media/model_aircraf...
UASes fall under the guise of "model aircraft" when operated as a hobby, but as soon as they're operated commercially, they're in their own, specifically defined class of aircraft, as clarified in 2007 (and linked in this comment's sibling).
That's why quadcopter video operators often employ humorous (and probably not legally workable) workarounds to sell footage into commercial projects - for example, flying "as a hobby" and then later selling "found footage" back to production companies, or renting some related-but-not-flying piece of hardware like memory cards to the production company at an exorbitant rate (which is really the cost of flying the drone).
EDIT: Oh, and 'baddox above reminded me that there's question as to whether any of the FAA's regulations about what is and isn't a model aircraft are enforceable, since they seemed to do an about-face about what counts as a model aircraft as soon as UAVs came onto the scene.
One court and most observers said no, the FAA can't suddenly decide some things are model aircraft and some aren't based on whether or not they're used commercially ( http://www.dronejournalismlab.org/post/78814729933/judge-rej... ), but the FAA appealed and based on my understanding their appeal means the ruling isn't in effect.
In the uk when doing commercial flying tests your meant to bring the aircraft you aim to fly along with you, what happens if you have loads of aircraft and are a seasoned hobbyist wanting to make money from your passion? You can get around it, do something for someone and just tell them to keep it hush and make a donation to you in some way.
I think these should be regulated, even though I own and fly several quadcopters and fixed wing planes regularly. Model aircraft have gone well in the US for the last 30ish years because people tend to self-regulate and the hobby hasn't been very big. Now that every Silicon Valley joker wants in on a perceived gold rush and DJI Phantoms work well and are available for a relatively low cost, hobby flying is moving into dangerous populated areas and the density of R/C craft is increasing.
I don't trust the FAA to correctly regulate these, and I see a very depressing day where I won't be able to fly as a hobbyist, but I also see an unregulated future where regulation-skirting companies (maybe they'll "crowdsource drone pilots" or something similarly "sharing economy"-esque) accidentally hit people with drones and basically say "so sorry, sucker!"
As for your latter point, that's basically what happens here, too. Lots of TV and commercials are filmed using drones, but the production company either sells the footage as "found footage" or rents out some non-drone piece of equipment (camera, memory card, etc.) from a drone owner at an exorbitant rate with the understanding that the rest covers the drone rental.
The FAA's roadmap here:
http://www.faa.gov/about/initiatives/uas/media/UAS_Roadmap_2...
indicates that they plan to implement these requirements for all drones which aren't sUAS with a line-of-sight requirement.
I believe these drones should be authorized for testing and commercial flight over unpopulated areas below 500ft and possibly above in certain airspace classes - basically, that the existing, frequently ignored hobbyist "recommendations" should be enforced as "rules" and applied commercially.
In theory, the FAA's funding is contingent upon having rules in place. In practice, I'm sure congress will grant them an extension when they end up late.
This 2007 policy document clarifies the FAA's stance about drone operations, citing various FAA notices and arguing that commercially flown drones are subject to the standard Part 91 aircraft regulations and none are approved - thus, making them illegal.
http://www.faa.gov/about/initiatives/uas/media/model_aircraf...
This 2012 notice clarifies the FAA's stance that model aircraft are not all aircraft under 55lbs, but rather those that are flown by hobbyists non-commercially, again citing various FAA notices (but no actual rules).
https://www.govtrack.us/congress/bills/112/hr658
The FAA Modernization and Reform Act of 2012 gives the FAA explicit authority to regulate Unmanned Aerial Systems and requires that they implement rules within a certain timeframe (as yet, no rules are implemented - they work through this process: http://en.wikipedia.org/wiki/Administrative_Procedure_Act ).
The FAA tried to fine a high-profile UAV operator (the founder of Team Black Sheep): http://www.usatoday.com/story/travel/flights/2014/03/07/faa-...
The lowest NTSB court ruled that the FAA's current UAS regulations are unenforceable as the FAA's attempt relied on Notices to Airmen and FAA Policy documents, but no actual enforceable FAA Rules. However, the FAA appealed which immediately stays the decision (due to the procedure for NTSB proceedings).
Observers expect the appeal to fail, but by the time the court proceedings are complete there's a good chance that the FAA's actual Rules will be in place.