Updated to note that Southwest Airlines is now saying it will charge $5 for Wi-Fi regardless of device or flight (holy moly…what will this mean for Gogo pricing?) And yes, this update means that I had to have one more word. Arghghgh. The grip of SM addiction!
I’m jumping off the grid for about 10 days to disconnect and recharge my batteries, but before I do I feel compelled to write an in-flight connectivity news and speculation blog because – per usual – this part of the industry is HOT, HOT, HOT, and apparently I have an incurable sickness when it comes to the topic (which will make my pending disconnect all the more difficult! I’ll let you know if I go into withdrawal.)
As I’m writing this blog, a major piece of news has just broken on Twitter. @FlyingPhotog, who is attending Southwest Airlines’ media day, says the carrier – which is acquiring AirTran – has vowed to honor the IFE contracts currently in place at AirTran. This news is no doubt putting a smile on the faces of both Aircell and LiveTV, which provide AirTran’s connectivity and XM satellite radio, respectively. What we don’t know, however, is what the terms of those current contracts entail (meaning Southwest’s decision might be an interim one until the contracts expire. Southwest is a customer of airborne high-speed Internet provider Row 44. The carrier is in a unique position in that it can test both the Aircell air-to-ground (ATG) system and Row 44′s Ku system side-by-side, as @jbernie points out.)
Separately, Southwest recently showed signs that it liked the $7 pricepoint for its current Row 44-provided Internet. @Melissa808 received the email below from Southwest (hat tip to @curbcrusher for the heads up). However the carrier now says it will charge only $5 for Wi-Fi irrespective of device or flight. @FlyingPhotog broke the news on Twitter first and then Southwest issued this release. $5! El Cheapo!
Speaking of pricepoints, let’s talk (again) about Oman Air, which is charging just under $30 for 26MB per flight for Internet. The carrier saw my recent blog about its Inmarsat SwiftBroadband-supported OnAir in-flight connectivity package – which was based on Oman executive Saurav Mukherjee’s comments on LinkedIn – and thought I might be interested in some further information about passenger usage of cell phone and Wi-Fi connectivity.
AM I interested? Lordy yes!
“Although I cannot share the data that has emerged since the first aircraft to offer connectivity came into service in March, I can say something about some of the general trends. After an initial surge in take-up at launch time in March – as the novelty of the world’s first in-flight connectivity made itself felt – usage fell back to a lower level, as we expected it to after such a surge. Since then, the trend for usage has shown a steady increase and that increase appears to be ongoing.
“Mobile phone usage is greater than Wi-Fi usage and SMS messaging is used more than voice calls. Both mobile phone and Wi-Fi connectivity appear to be used more by business passengers than leisure passengers and this is reflected in the month-by-month patterns, ie noticeable increases in usage at the end of holiday periods, such as August and Eid. These trends are in line with Oman Air’s initial projections and we anticipate continued steady growth, as awareness of the service increases and as in-flight connectivity becomes the norm for all carriers.
“Price points and charging models will continue to be kept under review to ensure ease of use and value for customers. As part of this process, the views of staff, customers and industry colleagues are being sought – Saurav’s LinkedIn post was part of this process. The intention behind Oman Air’s introduction of in-flight connectivity was always to add to the range of services we offer our customers and to increase the range of available choices – not to encourage every customer to make cell phone calls or log onto the internet. Passenger feedback to date has been extremely positive and it is clear that the connectivity choices we now offer are warmly welcomed.”
Many thanks to Oman for the information. However, I wonder if other factors are at play with regard the pricing for Oman’s Internet service. One high-level industry source says SwiftBroadband data rates from Inmarsat are at/around the $6 per MB rate (yet, $30 per 26MB is clearly significantly below this rate). The same source claims that providers, such as OnAir, could not get lower rates from Inmarsat because Inmarsat’s primary consumers (outside aerospace) help set market rates and those rates are holding-up just fine. So, the questions are: Who is fronting this ‘lower’ $30/26MB rate? Did Inmarsat agree to a bulk purchase price to OnAir? Did OnAir supplement? Did Oman Air supplement? Or, did Inmarsat change its rate structure?
I put these questions to Inmarsat’s Lars Ringertz, and he says:
“Obviously we cannot comment on our pricing to our distribution partners, but the $6 figure that is circulating in the market does not reflect what a distribution partner would pay. We have been developing the SwiftBroadband service both technically and commercially to make it suitable for airline use. Anybody coming off the street wanting to buy 1MB will obviously pay more than anyone who is committed to consuming volumes of data because that’s normal logic.”
I’d imagine that when SwiftBroadband distribution partners add their own margins the pricing for the service can get into stupid figures. But even if we’re super duper generous and say Inmarsat is charging half of what is claimed, somebody must be making up the difference between the cost of the service and what the passenger actually pays. It’s not clear what OnAir/Oman Air may have done with respect to usage-averaging across multiple users. In other words, what’s the average total use per passenger below the 26MB? That might balance the ratio out somewhat, but one must wonder if either OnAir or Oman are at risk with make-up payments to Inmarsat, or if Inmarsat actually cut a deal. Ho, hum, diddly dee. I’ll ponder this conundrum on my holiday. NOT! Okay, maybe.
Visual relief alert – fun ‘rubber ducky on holiday’ snap is followed by even more text.
Meanwhile, we have yet to fully address the question of why former Connexion by Boeing (CBB) customer Singapore Airlines has opted for OnAir’s SwiftBroadband-based solutions over the Ku-band satellite-based high-speed Internet solution on offer from the carrier’s sole IFE supplier Panasonic. Could it be that SwiftBroadband pricing has well and truly come down to reasonable levels? Is SIA simply afraid of Ku, having been burned by Connexion? Does SIA see an urgent need to get basic connectivity on board its aircraft ASAP, including the A380 (where only OnAir is offerable)?
As I mentioned in the comment section of my Oman blog, Panasonic and its partner (OnAir rival) AeroMobile made some headway by gaining offerability for Ku on the Airbus A350 but only because Panasonic presumably refused to sign the in-flight entertainment portion of the deal unless Airbus relented. Airbus continues to deny linefit offerability to any connectivity solution except OnAir on all its current-gen twin-aisles. Perhaps, like Boeing with the 787, Airbus does not want anything (else) to stand in the way of delivery dates for its aircraft, most especially the A380. Meanwhile, SIA has seen all these announcements about carriers bringing in-flight connectivity to their aircraft (Cathay, Lufthansa, Turkish have all opted for Ku) and clearly SIA is feeling the competitive pressure, esp with the Cathay deal (and wants a piece of the headline action). Added to that, SIA is a former Connexion customer that was burned by CBB, and now – shite! – SIA is being burned by Koito too (the disgraced aircraft seat manufacturer). With two major partners falling by the wayside in the last few years, SIA may have wanted to go with what is no doubt being billed as the safe bet, a SwiftBroadband-supported solution that is linefit offerable on Airbus aircraft (including, substantially, the A380). Even Emirates, a carrier that was committed to offering AeroMobile’s service across it’s entire fleet, has gone with OnAir for the A380, after no doubt considering the time/expense associated with retrofitting A380s with another product.
I know that most consumers don’t know the difference between SwiftBroadband and Ku-supported connectivity, which is why SIA can get away with saying it will replicate in the air the type of environment that its customers “have gotten used to on the ground” via OnAir’s solution – and enjoy the news headlines that go along with that promise. But, in this instance, we need to call a spade a spade.
SwiftBroadband does a great many things – it is virtually global (minus the poles), has just one service provider (Inmarsat, which is handy dandy), and is excellent at supporting in-flight mobile connectivity. But, after having tried SwiftBroadband-based Wi-Fi at Thales’ connectivity suite in London, I can tell you that SwiftBroadband does not support in-flight high-speed Internet, at least not how most regular Internet users define high-speed (for a definition of broadband go here).
SwiftBroadband does not replicate in the air what passengers receive on the ground. And it does not support TV over IP (which will be offered by Cathay and others via Ku). Additional SwiftBroadband channels will be added in the not too distant future, but SwiftBroadband is an entry point to connectivity. Even Inmarsat knows that (it is, after all, readying to launch a superfast Ka-band satelilte-based solution, Global Xpress in 2014, which gives the likes of SIA the promise of an upgrade path in terms of the commercial partner. System-wise, the on-board WLAN would remain, but the Ka-Band solution would require a new antenna, mount, and radome, antenna controller, power supplies, as well as a new modem.)
Speaking of SwiftBroadband and pricing, some really interesting news broke at the recent NBAA show in Atlanta, but this time with respect to hardware. Cobham is among the in-flight connectivity hardware manufacturers building systems to support Inmarsat’s new class of SwiftBroadband service – dubbed SB200 – for small-sized regional and business jets and turboprops. The manufacturer has launched its SB200 installation – which provides standard IP data up to 200kbps, circuit-switched voice telephony, and streaming IP data up to 16kbps – at a cost of just $32,000. The figure is far less than the $60,000 figure projected by Cobham in February. It is still a tad higher than the $25,000 figure that Inmarsat would like, but Cobham is getting darn close!
Indeed, in-flight connectivity – and the wondrous things you can do with it – was a major theme at the NBAA show. During the show, I spoke to TrueNorth Avionics, which announced it has been chosen as the standard cabin telecommunications supplier by the Airbus Corporate Jet Centre (ACJC) of Toulouse to provide cabin telecommunications for Airbus corporate A320 and A319 aircraft. TrueNorth’s Simphone OpenCabin system – with Wi-Fi, voice and high-speed data integration, corded and cordless handsets and a range of network products – will be offered on these VVIP aircraft. The Simphone OpenCabin system offers two channels of Iridium voice and integrates with other connectivity (such as SwiftBroadband, Ku or Ka) so it can be “upgraded indefinitely”, says TrueNorth. ACJC says it will use SwiftBroadband (Airbus’ connectivity of choice these days).
I also had a chance to talk to both EMS and Thrane & Thrane about theirnew SwiftBroadband-supported cabin handsets for business aircraft, andto Aircell, whose GogoBiz air-to-ground (ATG)-based solution is part ofNextant Aerospace’s Hawker 400A/XP modernization programme.Check out Aircell’s latest HotSpots eZine. (NOTE: Flightglobal took some great video of all three companies withthe intent of including the segments in our snazzy iFlight magazines,but time proved our enemy…i.e. we ran out of it. I’m hoping to wrestlethe footage off of production before NBAA is a distant memory….hoping!)
And here is our show highlight video that did make deadline.
LiveTV, meanwhile, took the opportunity at NBAA to announce an expansion of its Blackberry on Board (BOB) product to include BlackBerry, iPhone, and iPad consumer hardware, under a catchy upgrade programme called “Pimp my Magnastar”.
Speaking of LiveTV, let’s jump back to the commercial sector to ponder how the JetBlue subsidiary might play its next hand. JetBlue recently announced that it is bringing Ka-band connectivity to its fleet via LiveTV and ViaSat (the latter has since bought Arinc’s SKYLink for bizjets!!). I tapped LiveTV for additional info. Here are two of my questions:
1) Does LiveTV still plan to offer live television systems to all and sundry or are you taking things more in-house again (i.e. is Continental the last of legacies that will ever been offered live television?) Double i.e. – is the Eagle back in the Canary Cage?
2) And, if so, are you guys happily tucked under JB’s proverbial wing for years to come (i.e. no IPO)?
LiveTV declined comment. However, I remain super-curious about the topic. What is United Airlines going to do about connectivity and live television now that it has merged with Continental Airlines? Continental has been fitting its domestic fleet with LiveTV’s latest generation LTV3 system, while United offers Aircell’s Gogo service on a limited fleet.
United has a brilliant opportunity to offer – at least domestically – a killer combo comprising the best in-flight television via LiveTV coupled with high-speed Internet from either Aircell or ViaSat/LiveTV.
Incidentally, LiveTV brought a golf course to the recent APEX convention in Long Beach. I stumbled upon the course right at the time when United was winning the game (nice!). “United is right now in first but airlines can come play all they want and see who wins at the end,” said Moeller (see below).
I cannot mention APEX without mentioning the 2-3 November technology committee meeting in Los Angeles, which will not be attended by yours truly (because of my holiday) but will be attended by Jonathan Norris, vice-president, cabin design office at Airbus (and a member of the APEX board).
Jonathan will be tweeting feverishly at the committee meeting so be sure to follow the hashtag #APEXTC10 or jump back to this blog post and check out the Twitter stream below. See you in 10 days!