Olivier Badard, president of Thales Middle East, last week gave a broad-reaching press conference at the Dubai air show about the many projects underway at the Thales Group.

He touched ever so briefly on in-flight entertainment and connectivity (IFEC) and so, when I had my chance, I asked him about the new Thales connectivity suite in London.

Badard reveals that Thales is working on highly-connected Thales i5000 IFE systems for "a couple of customers" and that while these will be supported initially with Inmarsat's L-band aeronautical services, it could entail other bands in the future.

Here is Badard in his own words.

I cannot tell a lie. Zodiac unit Sicma Aero Seat's new audio/video on demand (AVOD) IFE system managed to fly beneath my radar for some strange reason. But I remedied that at the Dubai air show.

Hear Zodiac explain why this system, which has been "specially developed to facilitate its integration on seats", and will be launched by Royal Jordanian, is so special. (Dear God, do I look like I need some sleep or what?)

Zodiac Aerospace has launched a new, fully-flat business class seat (the 7812) that is, well, fully flat! Not just lie-flat! And VERY comfortable. I took a test ride at the Dubai air show.
 

 

I just got off the phone with IMDC chief executive Wale Adepoju, who was kind enough to talk to me about what airlines need to consider when looking at bringing in-flight connectivity on board their aircraft.

The entire interview with an eye-opener, so be sure to check out the January issue of Airline Business for my next in-flight connectivity feature, and more from Adepoju (the feature will also run on the Flightglobal IFEC news channel).

However, the in-flight entertainment and communications (IFEC) expert divulged the four key points that IMDC is imparting to its airline clients behind closed doors. Before we go there, however, let's lay the groundwork with a key quote.

Says Adepoju:

"Ku-band is very different now than what it was five or six years ago. It has improved in terms of performance.

"There are now viable options [including Ku, SwiftBroadband (SBB) and ATG]. I would have no qualms about installing any of the different options now.

"They all have a market so we are way past the 'which technology will win' stage and we're at the point where, if a particular technology has a sufficient market to be able to deliver scale, I think they all have benefits and they all have use.

"There will be more airlines that will announce Ku. It has a value, it has a use. SBB is a natural selection for certain airlines."

And now for those four steps:

1) Connectivity is an essential part of the future of aviation. Connected aircraft are essential going forward. It will affect the bottom line sometime in the future.

2) You have to have a clear plan as to how you are going to approach in-flight connectivity.

3) Each airline has to have its own unique solutions' based on its geography, demographics, size, type of applications, etc.

4) And the other thing, which we've never gone public about, is - Don't be afraid to ask suppliers to do more than their standard offering! Quite often these companies have created solutions anticipating the airline, but if the airline needs something slightly different, often they can adapt. That is the value of having aerospace-based connectivity companies. If you had to rely on communications companies, you'd have to buy what it said on the tin. I think it's important for the industry and everyone to get involved with that to MAKE THEM ALL ACCOUNTABLE.

So how might airlines get educated about their options, and what would make sense for their own unique business models? Adepoju suggests the industry holds more educational gatherings like the connectivity workshop held earlier this year in Everett, Washington (pic below).

I have to agree with him there. The WAEA connectivity workshop was an excellent "Connectivity 101" course for airlines and an excellent refresher for IFEC experts. It also provided a platform for some pretty frank conversation, including about Airbus' connectivity strategy, which is currently centered on SBB. Plus, I had a chance to wear my yellow coat.

This John McPherson cartoon, running in the local Lancaster newspaper, put a smile on my face this morning. It gives new meaning to the idea of having one's 'legs in the air', ahem.

Don't be getting any ideas O'Leary, ya monkey.

Aircell has never released usage stats for its Gogo in-flight Internet system. Yet, in a statement last week, Aircell CEO Ron LeMay came awfully close to giving away the goods. In so doing, he has lit a fire of speculation in the IFEC industry.

Two IFEC insiders, located on opposite sides of the world and from opposite sides of the IFEC industry (and whom we'll call Chap 1 and Chap 2) have each concluded that Aircell is getting about six users per flight.

Here's how they get that figure.

Says Chap 1:

Aircell claims it served its one millionth customer in October, and that users are fast approaching 100,000/week.

Sounds impressive, doesn't it?
 
In reality it is 14,286 users/day. Divide it on the 623 aircraft out there with Gogo and you get 23 daily users.

Since they probably fly 4 segments/day, you get 6 users/flight!   

So obviously there is not much change in usage from what we have known since before and not more usage than Connexion by Boeing had in 2006. 

In a completely separate exercise, Chap 2 hands us the following chart (click on it to make it bigger):


So what does this mean?  "Well, combine this with Row 44 saying they are getting 4% and hoping to grow this to 12%, it matches perfectly with the numbers above. Then add on Google wanting it to be free in airports and you nailed it. People are just not going to pay," says Chap 2.

Okay, we've been talking about this for some time now. Folks love in-flight Wi-Fi (I can pull up another Twitter stream if you need proof) but they don't seem willing to pay. So lets venture into the world of complete and utter speculation about Aircell's costs and when it might be able to pay those off.

It could be a useful exercise and may provide a ray of hope for the pay-for-service model albeit with an important caveat. But again, this is the world of speculation!

Says Chap 1:

"If we assume that Aircell has been giving away the installations at $100 000 each, the cost for them to date has been $62.3 million. Add the cost for the spectrum ($33 million) and the cost for the base stations (just guessing $50,000/each x 100) you have another $5 million for a grand total of $97.3 million that needs to be paid.
 
If we assume 100,000 users/ week, all paying $10 for the service (yes, I know they give a lot of it away for free) they would be generating roughly $1 million/week.

With an annual salary cost for maybe 200 people assuming they all make $60000/ year (not sure if that is a reasonable assumption, but might work as an average) their cost to the last year has been $12 million.
 
So unless they have any other CAPEX or costs that we have missed out, and no cost for running the network and their facilities, they should be able to pay off their capital cost in two to three years. 
 
ASSUMING THAT THEY DON'T GIVE ANY REVENUE TO THE AIRLINES!

Many thanks to our two chaps for their insight. I think Aircell may still have a few tricks up its sleeve. More on that later.

In the meantime, US legacy carriers finally have got something to boast about - they are the first sizable group from the same geographical region to offer in-flight Internet to passengers.

Their customer service may be abyssal, their ancillary fees a pain, and their seemingly nonchalant attitude an embarrassment to mankind, but legacies are trying to keep you connected. Nice one, chaps!