The company announced last week Axios The company is closing 18 Walmart delivery centers in those cities to focus on its business in the Dallas-Fort Worth metropolitan area, a region the retailer announced in January that it would expand to serve 1.8 million people.

According to the report, the decision will cost 70 jobs, or about 17 percent of DroneUp’s workforce.

“Layoffs are an unfortunate part of a company that literally defines its own industry,” said a DroneUp spokesperson FLY“As with so many innovators before us, the decision to automate often leads to similar circumstances, but we recognize that this is a difficult time, especially for those we have parted ways with.”

The spokesman declined to disclose the number of locations to be closed or the number of employees affected.

After successfully testing a drone delivery service near Walmart’s headquarters in Arkansas, DroneUp and the retailer expanded it to six states – Arkansas, Arizona, Florida, Texas, Utah and Virginia – and an estimated four million people.

According to Axios, the elimination of Phoenix, Salt Lake City and Tampa leaves the partners with 15 hubs, most of which are in Dallas-Fort Worth. The retailer also works with drone delivery services Zipline and Wing, a subsidiary of Google parent Alphabet, in this region.

“We are pleased with the momentum and positive customer response we have seen around drone delivery,” said a Walmart spokesperson. FLY“This service will continue to evolve as we learn more about customer preferences and drone capabilities. Our drone delivery program is still a pilot and by focusing our efforts on Dallas-Fort Worth, we can learn more about the potential to scale this innovative delivery option for Walmart’s customers.”

According to DroneUp CEO Tom Walker, it costs the company about $30 to deliver a package, making the service unfeasible in its current form. To solve this problem, the company is focusing on Dallas-Fort Worth as a testing ground for its autonomous drone ecosystem, which was unveiled in March.

The ecosystem includes a range of ground, air and software products combined into a single platform, including software operating systems, automated ground infrastructure and two next-generation drones.

Designed to make deliveries autonomously in as little as 30 minutes, the drones fly between automated outdoor lockers and customers’ homes, making about as much noise as a refrigerator at cruising altitude. Each is equipped with a special claw-like gripper that enables airdrops from up to 36 meters.

In this context, the DroneUp operators act like air traffic controllers, each of whom is assigned to monitor a strip of airspace. Meanwhile, retail employees only have to pack and load the orders – the automated lockers and drones do the rest.

“DroneUp remains committed to a strategy that supports our retail partners and their customers,” a company spokesperson said. FLY“The insights we have gained over the past few years are feeding into a strategy to reimagine the last mile of delivery using DroneUp’s ecosystem platform that is economically viable for sellers and scalable for buyers.”

The ecosystem is designed to expand the reach of the company’s operations, which were bolstered in January when the FAA allowed the company to fly its drones beyond the operator’s line of sight (BVLOS). DroneUp is one of a handful of companies with BVLOS permits, which are only available through an FAA waiver or exemption.

Walmart, meanwhile, recently launched a drone delivery integration into its digital app, allowing customers to order directly from their phone or computer. The retailer began rolling out the offering in June and will notify customers when they are eligible for delivery through the app. This initiative is supported by partner Wing, which has launched a set of application programming interfaces (APIs) that will allow Walmart to integrate drone delivery directly into its e-commerce platform.

In Dallas-Fort Worth, Walmart and its partners got a boost when the FAA lifted BVLOS restrictions on Zipline and Wing. This historic move, announced in July, allows the companies to manage their own airspace under FAA oversight and eliminates the requirement to station human observers along delivery routes.

With fewer personnel required and the ability to conduct BVLOS flights, the companies should be able to reduce costs while expanding their services to more customers. The approval may have played a role in DroneUp’s decision to focus on the region.