Printed headline: Broad-Ranging Decision
The time when passengers will take high-speed onboard Wi-Fi for granted is probably coming soon. As the unit cost of a gigabit per second (Gbps) is decreasing, offers for broadband inflight connectivity are burgeoning. But airlines should carefully consider their needs before settling on one option or another.
Inflight connectivity equipment and service providers tend to use surveys to persuade airlines they should move fast to offer broadband internet for passengers and crew. A few years ago, Honeywell suggested that 13-22% of passengers (depending on the country) would give up the use of restrooms during the flight for “a faster and consistent wireless connection.” More recently, a Honeywell survey found that 21% of travelers have abandoned their preferred airline for another with better inflight Wi-Fi, up from 17% in 2014.
According to a joint study by Inmarsat Aviation and the London School of Economics (LSE), 25% of commercial aircraft are offering passengers some form of onboard broadband. “This is often of variable quality, with patchy coverage, slow speeds and low data limits,” the authors say. Even so, they believe inflight connectivity will be ubiquitous across the world by 2035.
To motivate airlines to pursue this goal, they reckon that “broadband-enabled ancillary revenue will reach an estimated $30 billion for airlines by 2035.” This may include broadband access fees, advertising revenues, e-commerce and premium content purchases. That amount has to be compared to “traditional” sources of ancillary revenue, such as seat upgrades, onboard duty-free shopping and baggage fees, currently amounting to around $60 billion.
Growth in broadband-enabled ancillary revenue will be driven by the introduction of new-generation satellites. “These address the key requirements sought by passengers that have been lacking to date in many cases, most importantly high bandwidth and continuous connectivity,” Inmarsat and LSE say. These are seen as “integral components of quality, which remains the primary driver of broadband take-up.” Passengers appear willing to pay more for high-quality onboard connectivity, the authors go on to say.
Revenues may also come from passengers without them even being aware of it. “The opportunity for revenue growth from broadband-enabled services is dependent on airlines commercializing passenger data (such as location and purchase history) to a much greater degree than occurs currently,” the study says.
Such arguments to move forward with aircraft equipment immediately may also be inspired by the current overcapacity in orbit. Satellite communications providers are endeavoring to find customers for their numerous new, enhanced-throughput spacecraft. They may also feel under pressure, as new entrants claim to be about to revolutionize the market. However, airlines must carefully review their options before making such a major decision.
“It is not just about the capital cost for equipment or unit cost for Gbps,” says Don Buchman, vice president and general manager of ViaSat’s Commercial Mobility business. The airline should think about its goals for Wi-Fi. Is it passenger engagement? Or just minimal-cost “me too” Wi-Fi installation to “check the box”? According to Buchman, carriers are increasingly looking for massive bandwidth, enough to ensure that Wi-Fi and voice calls are available in the cabin, as well as cockpit connectivity and future operational needs.
Airlines are moving away from an approach that combines limited bandwidth and revenue sharing with the communications provider, like air-to-ground (ATG) networks, he explains. For passengers, “it was expensive and poor quality; it could be compared to dial-up quality,” he says. This approach was initially cheaper for the airlines, which believed it was lower risk. But some airlines “in fact found themselves black-eyed because passengers complained,” Buchman observes.
So what is the business case for an airline choosing to install broadband for cabin Wi-Fi and cockpit connectivity? “The industry has [struggled] and continues to struggle to find this answer,” says Mike Moeller, vice president for aviation sales, Americas, at Global Eagle, an inflight entertainment provider. Moeller believes each airline is in the best position to monetize the solution and find the best ways to differentiate its brand.
“From a passenger’s view, reliable and fast inflight connectivity will soon reach the must-have level on all flights, including short-haul ones,” says Floris Reimbold, director of inflight entertainment and connectivity technology for the Lufthansa Group.
Gogo defines the target performance for its satellite Wi-Fi solution, 2Ku, with six digits—15, 98, 98. “This stands for 15 Mbps for a passenger’s device, 98% coverage of flight routes with 98% availability,” Blane Boynton, Gogo’s vice president of product management, says.
Historically, Gogo’s offer was supported by an ATG system. A regional service available in the U.S. and Canada, it can supply up to 10 Mbps per aircraft. While satellites have become dominant in the inflight connectivity industry, ATG will not disappear anytime soon. Gogo’s ATG will be upgraded next year to a level comparable to the satellite-based service it began offering in 2015. Inmarsat’s European Aviation Network uses both space-based and terrestrial communications.
In satellite communications, ViaSat’s Buchman likes to refer to U.S. carrier JetBlue, which has “changed the business model.” ViaSat’s launch customer wants all passengers to be connected—with full internet, including video streaming—at no additional cost. “Wi-Fi is no longer a revenue stream but part of the experience, like the gate agent and the seat,” he says.
Gogo has a different view: “Lately, airlines have been transitioning to a multi-payer model, where the airline or a sponsor is paying for part of the cost,” Boynton says. The most common model so far has been full payment by the passenger. On a long-haul flight, Lufthansa charges €17 ($20) for up to 24 hr. of full access.
ViaSat has increasingly powerful satellites to support its service. Launched in June, ViaSat-2 will help change the general perception of satellite internet globally, making it “accessible and affordable to all,” the company says. ViaSat-2 will cover North and Central America, plus the Caribbean, northern South America, and aviation and maritime routes in the Atlantic Ocean between North America and Europe. From 2018, it will operate in the Ka band with a capacity of 300 Gbps. Indicative of the acceleration in the growth of the bandwidth available globally, the 1,000-Gbps ViaSat-3 (actually the first in a constellation of three) is scheduled to enter service in 2020.
For its 2Ku system, Gogo has agreements with satellite operators such as SES. Coverage is said to be global, except for the poles (important to cover, as they allow more direct airline routes). Boynton says 2Ku is compatible with in-development low-Earth-orbit constellations (LEO), as opposed to medium Earth orbit, (MEO) and geostationary Earth orbit GEO).
The Ka band is poised to gradually become the one most used for broadband internet, thanks to its higher throughput and despite its greater sensitivity to weather conditions. Global Eagle has both Ku-band and Ka-band solutions available. “Having both technologies and the unique capabilities of each allows Global Eagle to develop unique solutions tailored to an individual airline requirement,” Moeller says. “We feel it is imperative to remain technology—(Ku- and Ka-band) and network—[GEO/MEO/LEO]-agnostic to provide a future-proof solution that drives down bandwidth costs today and into the future; airlines selecting closed and proprietary networks may find themselves stuck with the next BlackBerry of the future.”
The hardware for Ku and Ka bands is different, with Ka-band antennas being more compact. The price is roughly the same, according to Buchman, but not all connectivity providers have the same model for installation. While ViaSat trusts all MRO service providers (as long as they have an FAA or European Aviation Safety Agency approval), Gogo has a network of “preferred” MRO shops. Global Eagle relies on its airline customer’s preferred MRO.
The hardware equipment to be installed on the airframe includes the radome, the antenna and an interface structure. In addition, there are electronic “boxes” with a server, wireless access points and a content loader. Gogo uses a phased-array antenna for its 2Ku system. It has an agreement in place with Airbus to use the same hardware across the airframer’s product range.
ViaSat and Gogo say an airline should plan for 2-4 days, or 36 hr., respectively, of work per aircraft, for system installation, which can be part of more extensive maintenance work. Global Eagle estimates that a typical installation for its broadband solution takes 3-5 days.
Honeywell emphasizes it has designed its JetWave terminals, for Inmarsat Aviation’s GX network, for standard tools available in maintenance hangars. Lufthansa Technik claims its technicians can install the JetWave antenna with less than 100 rivets, 10 times fewer than comparable systems. “Fewer rivets mean fewer fuselage holes to be patched up when aircraft transfer ownership or come off lease, and fewer labor hours,” Lufthansa Technik says.
Gogo’s Boynton suggests that an upgrade from ATG makes sense, as the cabin network may be reused.
While cabin Wi-Fi is the most visible application of inflight connectivity, flight crews also may find benefits in broadband access to the internet. However, it may not be used for safety-critical communications. “Numerous airlines are looking at operational savings; thanks to real-time weather displays, they can avoid turbulence and optimize routes,” Boynton says.
Last November, ViaSat acquired Arconics, an Ireland-based supplier of software for wireless IFE. “One of the nice things about the Arconics acquisition is they are already providing cockpit services,” a company official said at the time. “Leveraging that, along with the capabilities we have to bring a lot of real-time data off the aircraft from both analytics and safety perspectives, is a huge opportunity.”
Rockwell Collins equipment will soon be line-fitted to every Airbus A320-family aircraft as part of the flight operations and maintenance exchanger (FOMAX) program. The solution keeps operators connected to their aircraft by deploying the infrastructure for secure wireless connectivity, Rockwell Collins says. The company’s solution for FOMAX features “a compact connectivity unit that collects aircraft maintenance and performance data and automatically sends it to ground-based operations.” For each flight, gigabytes of data (instead of megabytes) can be sent to the ground.
The FOMAX system can acquire 24,000 parameters on an A320 (up from 400 today). To transmit a much greater amount of data than is now possible, Rockwell Collins uses two cellular modems, one for the airline and one for the aircraft manufacturer, explains Philippe Lievin, Rockwell Collins’ director, connected aircraft marketing. The system selects the most appropriate communication channel—ACARS, satellite or cellular—according to criteria such as cost and flight phase.
The equipment includes a Wi-Fi antenna in the cockpit. The wireless access point includes a power limiter to ensure non-interference with the avionics. At 100 milliwatts, the limit is not expected to slow down communications.
In the cockpit, the crew will enjoy real-time weather maps accessible on a tablet. Pilots will also be able to use tablets for communications with their airline’s operations center.