Personal devices on aircraft may not spell the end of traditional inflight entertainment systems but could force management into a serious rethink
The new norm will be mobile In-Flight Entertainement (IFE) because it is portable, cost-efficient and more engaging for consumers
It is estimated that tablet sales almost doubled in 2012 compared with the previous year. By 2016, according to technology research specialists Gartner, 370 million tablets will be sold worldwide.
A lot of the buyers will be air travelers. The rise of smartphones illustrates the point. The SITA 2012 Passenger Self-Service Survey found that 70% of passengers are traveling with a smartphone, up from 54% in 2011 and 28% in 2010.
It bodes an important new trend in the industry—customers with their own devices that are capable of showing movies, playing games, and connecting to the Internet.
Could inflight entertainment (IFE) systems embedded in seat backs disappear from the aircraft, giving way to tablets and wireless delivery systems?
Moving with the times
On the surface, this is an IT issue. “Research and development will move away from the traditional IFE services because they are proving to be expensive to purchase, implement, and maintain,” says Andrew Kemmetmueller, CEO of Allegiant Systems. “The new norm will be mobile IFE because it is portable, cost-efficient, and more engaging for consumers. Many companies that previously offered traditional IFE products have already made the shift.”
Indeed, a handful of airlines already offer tablets to their customers. EL AL hands them out to business class passengers, for example, while Jetstar customers are able to rent them.
But this may be a stop-gap measure. There are some practical issues associated with this approach, such as storing the devices, handing them out, and dealing with any thefts or breakages. It also fails to overcome the barriers that have hampered previous attempts at increasing connectivity for passengers. Aircraft phones rarely get used because people don’t have their contact numbers to hand. Seatback email also suffered because of this lack of personalization.
But for passengers already traveling with tablets, the only real issue is having acceptable connectivity rates. Given the extraordinary uptake of smartphones and tablets, in addition to traditional laptops, facilitating the use of personal devices onboard has become a necessity, rather than a value-added service. And it drills deep into airline IFE strategy for the future.
More money in, less money out
If an airline decides to provide wireless connectivity on board, a number of strategic decisions will necessarily follow. The first is how to present the new technology to the customer.
A wireless service provides potential new revenue. Early movers such as American Airlines and Delta Air Lines have priced their offering between $0.99 and $3.99 per movie or TV episode. Airlines also have the chance to offer different prices for different Internet connectivity rates. With more than 400 passengers on a single long-haul A380 flight, this could become a significant revenue stream.
Encouraging customers to bring tablets onboard could affect more than just the amount of money coming in. Utilizing mobile technology could reduce expenditure. Moving away from heavy IFE systems saves an enormous amount of weight and that translates into money, fuel, and CO2 savings.
Lufthansa Systems suggests that removing the IFE from 250 seats on one plane would save 80 tonnes of fuel or some $90,000 every year.
A good IFE system can cost up to $3 million for a widebody aircraft. A wireless delivery system will be a fraction of that cost. Even supplying customers with tablets is a far cheaper option.
“Portable devices make it much easier to provide entertainment and information services in new markets,” says Walé Adepoju, Consultant at cabin technology specialists, IMDC. “Cost of entry is lower.”
Moreover, the maintenance and upgrades of IFE systems must be considered. An aircraft can last for a couple of decades. Consumer electronics and trends can change a lot in that time. Moving to a flexible wireless system—with less hardware in the aircraft—means airlines not only save money but also prevent lengthy boardroom decisions about when or if to upgrade. The aircraft can simply be adapted as an airline sees fit.
Is the future wireless?
Major business decisions will have to take into account the future of IFE. One question is whether to roll out a wireless delivery system among the entire fleet. Most major airlines don’t have IFE on short-haul flights but, with the cost and weight of a traditional IFE no longer necessary, this could change.
Changing this aspect of the business has implications for an airline’s approach for its product suite and, by extension, the brand. In the coming years, most existing long-range aircraft with a reasonable lifespan remaining will be converted to onboard connectivity.
“Some wireless deployments are on aircraft that already have embedded IFE systems,” notes Adepoju. “This makes it a service enhancement. On aircraft where there is no system it gives access to many, if not all, passengers who would otherwise have nothing.”
The uptake of tablets and smartphones does not necessarily spell the end of old-school IFEs. Seatback systems are becoming more sophisticated and may offer a more convenient viewing system than a handheld device.
Adepoju, for example, firmly believes that a market still exists for embedded seat back systems as well as portables. “To provide and ensure a consistent service, especially on long-haul flights, an embedded screen at every seat is a basic requirement,” he says.
Even so, Adepoju agrees that a technological shift is happening. And consumer electronics may come to influence important decisions in airline boardrooms.