Now that passengers on many carriers’ flights in numerous parts of the world expect Wi-Fi to be available as a matter of course, inflight entertainment and communications (IFEC) systems are becoming an ever more important aspect of passenger service.
How and what an airline provides in its IFEC offering increasingly will be key to the way a carrier can differentiate its services from those of its competitors. As IFEC capabilities grow alongside increases in the wireless-connectivity bandwidth available to passengers, IFEC also will provide airlines with new ways to earn ancillary revenue and generate frequent contact touch-points with their fliers.
That does not mean any one IFEC business model will become ubiquitous. Embedded IFEC screens and their in-seat controls will continue to adorn seatbacks in many carriers’ aircraft, even as those airlines introduce IFEC audio and video on demand (AVOD) broadcast by Wi-Fi for passengers to experience on their personal electronic devices (PED).
“I don’t think there will be a prevalent new model for IFEC. It will remain a competitive issue for the next few years,” says Michael Planey, co-founder of IFEC and IT consulting firm HMPlaney Consultants.
“Trends [in IFEC equipage] may be different, depending on the segment of the market,” reckons Cedric Rhoads, executive director of sales and product management for IFEC systems manufacturer Panasonic Avionics. “Wireless, rather than usurping [the embedded-IFEC] part of the market, is complementing it. Do PEDs, wireless and broadband connectivity do away with embedded? We’ve seen nothing of the sort.” [In fact,] “we’re seeing more and more airlines installing both wireless and embedded IFEC systems in long-haul widebodies.”
Different Strokes for Different Folks
Inflight connectivity provider Gogo says different airlines will adopt a variety of IFEC-installation strategies. “Like most things in the airline industry, this will vary by airline. We have built out capabilities for our airline partners to customize their products. . . . In fact, Delta is experimenting with this currently, with our Gogo Vision product,” Gogo says in an email to Inside MRO.
A consensus prevails among IFEC-industry insiders that business models and strategies not only will vary among airlines but also within an individual carrier’s different cabin classes and depending on whether a flight is domestic, short-haul international or long-haul intercontinental.
“They [vary] today and will continue to do so in the future,” says Planey. “In premium—first and business—classes, especially internationally, there will be more and larger equipment installed into the seats or suites. In economy, 7-9-in. screens have become the norm and will stay that way, as the screen size is limited by the size and pitch of economy seats.”
“You still will see premium [cabin] products go with HDTV as a differentiator. High-end carriers will continue to invest in it,” says Don Buchman, vice president/general manager of satellite-based inflight broadband provider ViaSat’s Commercial Mobility Business, who oversees its airline-connectivity offering.
Even in economy cabins, “Passengers love embedded [IFEC], particularly on long-haul,” says Rhoads. AVOD content delivered by Wi-Fi to passengers’ PEDs probably will be more widely adopted for economy cabins in aircraft operating short-haul flights.
“The biggest market [for Wi-Fi AVOD] is economy,” affirms Buchman. “The passengers will be just as happy” receiving IFEC that way. “Their tablets are probably better” than small seatback screens for watching films and listening (via passengers’ own headphones) to audio content, he says.
A Major Change
One important thing has changed. In the past, “about 50% or more of all aircraft—those operating domestic or short-haul routes—had no IFE at all,” says Rhoads. “Wireless solutions have changed that.”
The race by companies such as Gogo and ViaSat to offer ever-higher Wi-Fi bit-rates to every passenger is accelerating the adoption of wireless AVOD-to-PED IFEC on shorter-haul aircraft. “We believe it’s going to come to the point very soon where every single aircraft is going to be delivered with connectivity installed,” says Rhoads.
Gogo concurs. “We are leveraging the trend on the ground, which is that passengers prefer using devices they are familiar with—namely, their own. Our entertainment-on-demand solution, which we call Gogo Vision, adds almost no incremental weight to an aircraft and is easy to maintain.” Some 2,200 aircraft are now flying with Gogo Vision installed.
Some carriers—notably Qantas Airways and Alaska Airlines—have already adopted AVOD-to-PED IFEC for domestic flights. As important for airlines is that this service provides an excellent opportunity to derive revenue from their IFEC offerings by partnering with preferred content providers and to create long-term relationships with their passengers.
Download the App
Airlines can achieve the latter goal by requiring passengers wanting to sample AVOD-to-PED IFEC to download a carrier’s own app to their PEDs. “When you do this, passengers actually walk off the plane with the product on their devices,” observes Buchman.
Once a passenger has installed an airline’s app, he or she then may be more likely to use it at home or while traveling, to research and book that carrier’s flights, select its ancillary-fee services, check in and interact with the airline’s social-media presence. Via its app, an airline can alert the passenger to important changes in flight status as well as gate shifts and where to find connecting services.
Carriers can have their apps configured not only to let passengers choose which content to sample but also to control their seats’ functions. Additionally, carriers can ensure their apps highlight preferred content, web pages, connectivity services or hotel/car/ride-share/tour-booking services. This will allow airlines to obtain advertising revenue or a share of the premium-content and booking income from their preferred IFEC partners.
Some airlines already have arrangements in place with content providers such as Amazon Prime, Netflix and Hulu. “HBO is an active content provider in IFE, owning IFE rights to many of its original productions and licensing them for onboard [storage] and exhibition,” notes Michael Childers, a member of the Airline Passenger Experience Association’s board of directors and chair of its Technology Committee.
Getting IFEC to Pay for Itself
“Successful monetization schemes will greatly assist airlines that could not previously consider IFEC for cost reasons,” says Childers. However, the field of IFE rights is complex. “Most of the Hollywood movies licensed by . . . VOD streaming services do not include IFE rights,” he notes.
Additionally, third parties may have produced some of the streaming services’ supposedly original content on their behalf, but held back the IFE rights. Caching, or storing, Hollywood content onboard always requires an airline or its service partner to acquire IFE rights.
Inflight-connectivity providers can have revenue-generating partnerships, too. Gogo has a partnership with T-Mobile that enables its customers to receive 1 hr. of Gogo connectivity each time they fly. Gogo previously had an arrangement with Netflix to give passengers free Netflix access on Aeromexico flights in Latin America.
Although some carriers have tried to charge passengers for providing IFE content, most airlines traditionally have given away IFE content “with mixed results,” says Buchman. The idea has been to drive revenues through increased ridership.
More and More Connectivity
“Connectivity is probably going to go down the same road,” predicts Buchman. For instance, using satellite-based inflight connectivity provided by ViaSat, JetBlue Airways decided it would offer its FlyFi wireless-connectivity service free to all passengers: “It’s been a big hit,” he says.
“For connectivity, I think there is momentum behind the ‘freemium’ model,” says Planey. “Airlines can offer a narrow slice of available bandwidth for free, allowing quick messaging. Then, if the passenger wants a more bandwidth-intensive package for large-file transfer, airlines can charge a nominal fee.” Emirates uses this business model on some shorter flights, giving away connectivity initially but charging $1 for the remainder of the flight.
Nobody in the IFEC industry doubts inflight broadband connectivity at ever-higher bit-rates will be key to keeping passengers entertained, informed and pacified inflight. However, while a spectrum of opinion exists on whether massive multiplayer online gaming will ever play a major IFEC role, “it will be a piece of the puzzle, not the be-all and end-all,” says Buchman. No one is convinced virtual-reality (VR) headset technology is nearly ready for IFEC use.
“There are plenty of obstacles to be overcome before VR makes it onto planes, including the size of the equipment, poor battery life, a steep learning curve and hygiene concerns,” writes Gogo, which nevertheless is monitoring VR’s evolution and tests new systems against its IFEC product. Once suitable headsets are developed, Buchman sees VR as potentially being “pretty interesting,” particularly for virtual tours of destinations.
Providing inflight streaming video is difficult both because of the bandwidth required—“nothing else comes even close,” says Rhoads—and different countries’ regulations on streaming, which make the offering impossible on international flights. No revolution in IFEC technology is likely soon, because—as with Apple and other huge electronics manufacturers—most of the basic technology breakthroughs in electronics already have been made.
Emerging IFEC Technologies
However, IFEC experts think several emerging technologies will be important. Ultra-high-definition 4K IFEC screens “are on the horizon of most suppliers,” says Rhoads. Similarly, says Childers, high-dynamic-range screen technology, which “significantly increases the color palette and the brightness of video images,” offers much promise for IFEC use.
Another will be the ability of high-throughput satellites (HTS) such as the forthcoming ViaSat-2 and ViaSat-3 (a planned three-satellite network) and OneWeb’s low-Earth-orbit constellation (which Gogo will use for its 2Ku service) to provide very high bandwidth to every passenger on an aircraft, according to Planey.
Unsurprisingly, to Gogo and ViaSat, increasingly high-bandwidth connectivity will be the biggest revolution in IFEC. “Now we’re just touching the surface of that revolution,” explains Buchman. “Just like the internet itself, you have to take those opportunities and grow with them. When you put the right infrastructure in place, you’re not limited anymore just because you’re on a plane.”
As IFEC technology continues to develop, there will be many opportunities in the shorter term for MROs to reconfigure IFEC installations in aircraft interiors as airlines choose different business models for keeping their passengers entertained and connected.
Even on their single-aisle aircraft, some airlines—American, Delta, several Asian and Middle Eastern carriers—have chosen nose-to-tail embedded systems, according to Rhoads; so as IFEC hardware evolves, some carriers will renew their embedded installations. High-service-quality airlines will continue to compete to offer the best IFEC in their premium cabins, and this will mean continuing investment in IFEC hardware, according to Buchman.
In the longer term, however, opportunities for IFEC-related third-party MRO work may not be as plentiful as some facilities might hope. Many carriers will choose Wi-Fi AVOD-to-PED IFEC installations for their fleets, either as first-time IFEC customers or to replace the embedded systems now in their economy cabins.
Wherever Wi-Fi-broadcast IFEC replaces an embedded system, opportunities for longer-term MRO work will be lost, for two reasons:
▪ Modern satcom equipment on aircraft does not need to be replaced every time new satellites, which offer greater bandwidth, are launched. For instance, notes Gogo, “The big advantage of [our] 2Ku [system] is that we will be able to take advantage of advancements in satellite technology like OneWeb’s constellation as they come online, without the need to upgrade antennas and other hardware.”
▪ Onboard AVOD-content storage servers continue to become smaller, lighter, more reliable and easier to install and uninstall as technological advances allow IFEC-system manufacturers to provide greater processing power in more compact units.
Panasonic Avionics’ first AVOD systems “were fridge-sized, but with each iterative step we see a very strong focus on reducing weight, fuel burn and parts count, and improving reliability and the utmost capability,” says Rhoads. The company’s AVOD-storage systems today consist of eight “very small” modular concept units, each of which is line-replaceable, obviating any need for third-party MRO.