UPS

United Parcel Service  (UPS - Get Report) said Tuesday that it received the U.S. government's first full certification to operate a drone airline, heating up competition in the developing market for drone delivery service.

The Atlanta-based shipping company said its subsidiary, UPS Flight Forward, will initially expand its drone delivery service further to support hospital campuses around the country.

The FAA awarded UPS Flight Forward a Part 135 Standard certification on Friday, UPS said.

The subsidiary launched what UPS called the first drone delivery flight by any company under Part 135 Standard at WakeMed's hospital campus in Raleigh, N.C. That flight, using a Matternet M2 quadcopter, was flown under a government exemption allowing for a "beyond visual line of sight" (BVLOS) operation, also a first in the U.S. for a regular revenue-generating delivery.

Earlier this year, UPS partnered with drone-maker Matternet to launch its healthcare delivery service on the WakeMed campus.

"This is history in the making, and we aren't done yet," David Abney, UPS CEO, said in a statement. "Our technology is opening doors for UPS and solving problems in unique ways for our customers. We will soon announce other steps to build out our infrastructure, expand services for healthcare customers and put drones to new uses in the future."

Last month, Walgreens Boots Alliance (WBA - Get Report) said it was partnering with Alphabet (GOOGL - Get Report) subsidiary Wing Aviation to test an on-demand drone delivery service. Wing was the first drone operator certified as an air carrier by the Federal Aviation Administration.

In June, Amazon.com (AMZN - Get Report) debuted a new hybrid drone that can deliver small packages of up to 5 pounds. It has a range of 15 miles, the company said.

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