Is this going to replace UPS and FEDEX - Drone makes first legal doorstep delivery in milestone flight

Scale.

Each Carrier has a scale which they work exceedingly well at.

The USPS is great at "letter" sized mail because of the "junk mail" which subsidizes the cost of the regular mail.

Fedex is great for "Document Sized" Overnight/Priority mail.

UPS is great for "Medium Sized" boxed mail (think 5-40 lbs).

DHL is great for "Large Sized" slower priority mail.

The truck lines are great for Pallet, Less than Truck (LTL), and Truck Load delivery.

Drones will have to find a niche that fits a cost benefit "between" USPS/Fedex/UPS in regards to speed etc. As of right now, it's a novelty, and can be best equated with "Bike Couriers" like in major cities.

A second thought on this subject is surprise that the FAA didn't include Amazon in this first trial. With all the time, effort, and money they have put into using drones for delivery this is a strange move by the FAA to not include them. Perhaps it is a reaction, as your article mentioned, to the head-butting that has been taking place on this topic.
http://www.foxnews.com/politics/2015/06/17/delivery-by-drone-in-30-minutes-amazon-says-it-coming/
http://www.cnbc.com/2015/06/17/

I hope not. Just doesn't seem like a very good idea...maybe one day in the distant future, but I do not believe people are ready for this yet.

Hmmm... I'm not sure about this. Interesting as far as expediency but I'm not sure about the safety aspects.

Replace them? No. Augment slightly, maybe. Amazon will likely be the only large-scale user of them for this purpose.

Yup. No more pizza drivers, pharmacies will deliver to shut ins as will grocery stores. A lot of jobs will go away, but new ones are created. We need 100,000 drone operators right now. This is the future.

I think it is amazing that it has taken this long, I have been reading about this for years now. At the end of the day I think FEDEX and UPS have the resources and capital to adapt and remain relevant.