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Wednesday, June 10, 2015

Airline IFC Strategies Continue to Evolve

Woodrow Bellamy III

[Avionics Today 06-10-2015] On the first day of the Global Connected Aircraft Summit (GCAS), attendees heard perspectives on In-Flight Connectivity (IFC) from five different airlines, all with different perspectives on one of the industry's hottest topics right now. Executives and managers from United Airlines, Saudia Airlines, Icelandair, and Nok Air all had unique perspectives on the business models, technology, and future strategies for leveraging the use of Wi-Fi on their aircraft flying all over the world. 
Panelists at the "Airlines Roundtable: Improving the Passenger Experience Through Connectivity" session at the GCA Summit 2015.
The first panel of the day featured United Airlines, Saudia and Icelandair, each of which are currently at different stages of their connected aircraft deployment and operation. Although it seems as if in-flight Wi-Fi has become an expected airborne amenity, the panelists clearly noted that keeping up with passenger expectations and the pace of innovation and technological change within the aviation technology industry is a challenge. 
"If there’s anything that we’re learning its that we’re probably moving too slowly, because the customers’ expectations are rising and moving faster; I think the big challenge for an airline is to stay up to speed," said Gudmundur Oskarsson, director of marketing and business development at Icelandair. "That’s really where the airline industry is right now — just trying to get up to speed with what everybody else is doing. If you look at the hotel industry, they started charging for Wi-Fi, and then they stopped charging for Wi-Fi and they started looking at ways to utilize that in different ways … If there is anything that we're learning its that we have to move fast."
Speaking on the same panel as Icelandair, United Airlines provided an interesting perspective regarding their goal of providing a consistent user experience across its current total operating mainline fleet of 691 aircraft. The U.S.-based carrier features in-flight Wi-Fi from three different service providers: Gogo, Panasonic Avionics, and Live TV/ViaSat. According to Debbie Lee, program manager of in-flight Wi-Fi and entertainment at United, the airline has reached about 90 percent fleet equipage and is finding that featuring different providers can be challenging.
“The big challenge with having different providers is being able to offer passengers a consistent experience in terms of portal, user interface, and connectivity across the full fleet," said Lee, adding that United will focus on getting more consistency across the platforms offered by all three providers for the remainder of the year.
The cost and business model associated with Wi-Fi was also briefly discussed during the panel featuring United, Icelandair and Saudia. However, Nok Air CEO Patee Sarasin most effectively addressed that issue during his keynote luncheon speech about the Thailand carrier's innovative strategy around IFC deployment and operation for its passengers. 
“Why Free Wi-Fi? I’ll tell you why: its because the minutes, not the money. You have to pull out your wallet and start keying down your credit cards, and by the time it says ‘wait, processing’ you’re already landing, and you haven’t even started using it yet!” said Sarasin. “What free Wi-Fi does, it draws more customers. Everybody loves free stuff, right? Nok Air launched free Wi-Fi and the first week our load factor went up 12 percent just like that. I’d rather people flying on the planes and paying top dollars rather than paying $8.95, which nobody is going to use anyways, just because its there.”
Coverage for in-flight Wi-Fi is another issue facing airlines, especially for those flying internationally and have to provide connectivity both over land and water in different regions of the world. However, as Azman Ahmad, general manager of products management at Saudia Airlines, noted, the actual users of cabin-based Wi-Fi have a much different perspective on the solution that provides their airborne Internet connection. 
“To a customer, it really doesn’t matter whether it’s one system or another — Ka or Ku — it matters that the system is working,” said Ahmad.
Bandwidth is also an issue that airlines continue to face, primarily because it is difficult to predict how many users will be Web surfing, tweeting or checking emails at the same time on any given flight. Therefore, an airline or service provider can advertise or promote a certain connection speed for their IFC, however, whether or not every user actually gets the megabits per second (mbps) that is advertised is not always accurate. 
“Technologically, we just don’t have the pipe to allow all of the customers to be online at the same time and have a great experience,” said Oskarsson.
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