I recently wrote a Flight feature about how airlines are turning to in-flight entertainment and connectivity to drive fresh ancillary revenue streams. But is there really big cash to be made? One IFE expert with deep knowledge of the industry doesn’t think so by any stretch.
Here is a little food for thought for those of you keeping an eye on the industry, or readying to hop a plane to Long Beach for WAEA. Comments, as always, are welcome.
“Over the past few weeks I have read so many different reports about how the market for connectivity is going to worth billions. The reality is somewhat different. With airlines trying to survive the current squeeze and using the opportunity to ‘bury any other baggage they have’ connectivity particularly is not top of the agenda.
“It is a great achievement for the industry that Aircell, AeroMobile and OnAir are all flying and we finally have a sustainable approach to connectivity. However, the market prospect has been over-hyped. The figures do not add up.
“A handful of airlines will operate various forms of connectivity during 2009. The product will be successful in certain market, but the reality is that financially, it is no big deal. It is like having 2-3 extra items on the duty free trolley. However, as various companies look to get investment, the market is being talked up all the time. By the end of next week in Long Beach it will probably be a case of one wafer mint too much.
“The focus on connectivity is hiding major changes in IFE content and hardware. Content companies are consolidating and realising that there is no room for a ‘middle man’. Weight constraints and threat of portables (which was over hyped) has kicked IFE hardware into shape.
“The latest systems are 30-40% lighter and providing 3 times the content of the previous generation. This is before the latest competitors come out of China with ultra-high tech and low cost.”