Back to Air Transport IT Review - Issue 2, September 2009
In-flight mobility: View from the inside
Stephan Egli
Chief Commercial Officer, OnAir
OnAir is jointly owned by SITA and Airbus, delivering global in-flight mobile telephony and Internet services through a growing number of airlines.
The idea of global connectivity has evidently taken off. What's OnAir's experience to date?
In 2007, there were five early adopters. Now there are more than 30 airlines worldwide offering some level of connectivity. I'm pleased to note that OnAir has more than a 60 percent market share, rising to 81 percent for GSM/GPRS solutions. We've flown more than 36,000 flight legs to 240 cities in 52 countries. By the end of this year, with new customers coming on stream, we expect to have flown 100,000 flight legs on an estimated 100 aircraft. What's particularly pleasing is the level of connectivity.
There was early concern over the sociability of voice calls on a flight. What's the evidence showing?
On flights offering voice connections, it is not an issue. I think this is for three reasons. First, the ambient noise levels in the passenger cabin of an aircraft have the effect of neutralizing voice levels. Second, the average call duration is about three minutes. Third, the ability of the airline to turn off voice capabilities, for example during night-time flying, is understood and appreciated. To date, I don't think there's been a single passenger complaint. Both the media, and certainly the airlines who have been operating flights with voice calls, will confirm that voice is a "total non-issue" in terms of disturbance, but it is the key driver in terms of ancillary revenues.
As airlines start offering the service, other benefits are becoming evident. How do you characterize those?
In three areas. First, improvements in customer service. For example, if a long-distance inbound flight is delayed by a couple of hours, a high proportion of passengers will miss connections. Invariably this results in a degree of pandemonium at customer service desks as passengers try and rebook new connections. When the aircraft is connected, then automated booking tools can re-book the passenger, send a bar-coded boarding pass, send a hotel voucher if an overnight stay is required - and have all that completed by the time the late flight finally lands. So the passenger knows what's happening, can rebook appointments, collection arrangements etc. Less stress, better service...
And the second area?
Airlines have excellent opportunities for generating ancillary revenue through the connected aircraft, on top of the revenue-share from us of mobile services. For example, text messages can be sent to passengers offering promotional prices for on-board goods. Or partnership deals can be struck with service providers on the ground or event management companies offering passengers a menu of services and events at their destination for which tickets can be booked, paid for and received during the flight. More and more event tickets today are bar coded and are sent to mobile phones.
The third area is generally increased efficiency. Two quick examples: new telemedicine tools, connected to medical centres, can allow professional diagnosis of medical emergencies, providing high levels of care while avoiding unnecessary diversions. Bear in mind that medical diversion of an A380 can cost the airline half a million dollars. Another example: instant credit card validation by cabin crew not only helps cut the 3-5 percent losses airlines currently make on invalid cards. It also allows higher ticket items to be sold during the flight with the risk removed. Saves money and enhances revenue...
You sound upbeat for the future. Given the problems airlines are facing, is this a good time to be selling connectivity?
Yes, without question. We're offering airlines a way of differentiating themselves against competitors with an improved customer service offering. Passengers - particularly business passengers - have welcomed the opportunity to stay in touch. For each passenger, it's time spent in a more productive manner and for those passengers who prefer not to be connected - simply turn off your phone. For the airline, it's not only a valuable source of ancillary revenues but also a great cost savings and customers service opportunity.
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