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On Sunday evening in London Air New Zealand and Qantas took top honours at the 10th annual Airline Strategy Awards, hosted by Flightglobal publication Airline Business. UK representatives of the carriers accepted the awards at Lincoln's Inn.

Air New Zealand won for marketing, with our judges--who include Ray Webster, Joe Leonard, and Geoff Dixon--saying Air NZ is in an "industry leading position--pushing the outer edge," a comment viewers of Rico's work can attest to.

Another judge said, "I think Air New Zealand is game changing." Air NZ's use of social media has given it exposure--the four largest American TV networks featured the Richard Simmons "Fit to Fly" video--the carrier could never afford to pay for.

And Air NZ is not done yet. General manager marketing and communications Mike Tod told colleague Mary Kirby that Air NZ is in discussions "with one of the world's biggest movie studios" on a possible collaboration involving Rico. Financial benefits may soon trickle in: Tod says the carrier is developing an idea that may permit it to monetise social media.

Game changing was also on the judges' lips when commenting on awarding Qantas the technology award for its Q Bag Tag as part of Next Generation Check-In. Although radio-frequency identification is not new at airports, Qantas was the first to leverage the technology for the passenger experience and ultimately improving it.

"The technology has been around for a while, it just depends how airlines chose to use it," head of customer experience at Qantas Tanya Bulkin tells colleague Alex Thomas. The judging panel said Qantas's system was "potentially a game-changer and could change the business in a number of aspects". The system gives Qantas a leg-up in the corporate market, or at least until Virgin Australia replicates it--an active consideration, according to sources familiar with the matter.

Full reports on the award winners can be found here.

The complete laureates are:

• Executive Leadership: Kong Dong, Air China
  
• Low-Cost Leadership: Aditya Ghosh, IndiGo
• Regional Leadership: Bill Ayer
• Finance: AviancaTaca
• Marketing: Air New Zealand
• Technology: Qantas
• Environment: British Airways
• The Airlines Business Award for the executive who has had the greatest influence in air transport in the past decade: Tim Clark, Emirates
  

The current woes of Tiger Airways Australia are not enough for competing pan-Asian carrier AirAsia to fast-track its evaluation of launching a subsidiary in Australia.

"Regarding AirAsia Australia, it remains a possibility although not in the short term," Azran Osman-Rani said. Osman-Rani is the chief executive of AirAsia's long-haul sister carrier AirAsia X.

Last year Osman-Rani disclosed AirAsia was watching the emerging shift of Virgin Blue, since re-branded as Virgin Australia, forgoing the leisure market for a greater share of the corporate market. That could have reduced competition, paving the way for a new entrant.

"The way it is now, if you've got three players competing aggressively for the mass market segment that's all the industry can take," Osman-Rani said at the time.

"If the market dynamic changed and suddenly there is space and existing players start to rationalise fights and increase fares, it will be very tempting," he said of launching an Australian subsidiary operating Airbus A320 aircraft.

Australia and New Zealand are unique in being the only countries in the world to permit majority foreign-owned domestic airlines. Such carriers, however, are prohibited from operating international services.

The Australian market has yet to see a large swing in capacity as a result of Virgin Australia introducing domestic business class, the first time in ten years there is premium competition to Qantas. But it is still early days for Virgin Australia. The carrier's three-year game change plan, implemented under chief executive John Borghetti, called for the carrier to re-position itself in the 2011 financial year through 30 June. Achieving the rewards of a more balanced revenue mix and improved yields are targeted for the 2012 and 2013 financial years.

The market has, however, seen a short-term capacity reduction as a result of the Civil Aviation Safety Authority grounding Tiger Airways Australia for posing "a serious and imminent risk to air safety." CASA has applied to Australia's Federal Court to extend Tiger's grounding until 1 August. The court is to hear the case next Friday.

CASA's grounding was immediately provoked by two incidents of Tiger breaching minimum safe altitudes while on approach to land after being issued a show cause notice in March.

AirAsia X was involved in two minimum safe altitude incidents last year at Queensland's Gold Coast airport, which the Australian Transport Safety Bureau is still investigating and due to complete this year.

Osman-Rani said CASA audited AirAsia X's operations and renewed the carrier's air operator's certificate.

"They also acknowledged that the approaches into OOL [Gold Coast] are challenging," Osman-Rani said.

AirAsia X also enhanced its operations by including specific modules for Gold Coast approaches in its flight simulator programmes and regularly conducts recurrent training with its pilots, Osman-Rani said.

"It helps when we have our own academy with our own flight simulators and instructors," Osman-Rani said of the AirAsia Academy, which includes full motion simulators, maintenance training devices, as well as cabin trainers.

Although he did not directly contrast AirAsia's operations to Tiger Airways Australia, the grounded carrier uses a shared training facility in Melbourne, according to testimony from Tiger director of operations Tim Berry to a senate inquiry on pilot training and aviation safety.

For some, a recent Hitler parody video explains all that is wrong with Qantas. But for those wanting a more insightful and accurate account, look no further than 13 words chief executive Alan Joyce delivered last week about Qantas International: "It has achieved its required returns only three times in the past 15 years."

And if you think the figures are cooked, Joyce adds that "the good years have not been good enough to offset the bad."

The statement begs the question how Qantas managed that record and did not think it prudent prior to February to announce it would return its international division to profitability.

It also partially exonerates Joyce as Mascot's persona non grata since the problems he face are not ones he exclusively created but rather inherited from predecessors including Geoff Dixon and James Strong, the latter of whom resides on the Qantas board. Perhaps that explains why Joyce chose to reveal such an unflattering record.

Joyce was barely two and half years into his tenure when he announced a turn-around for the international division, details of which will be made public at the carrier's 24 August annual results briefing. While it can be asked why Joyce waited 2.5 years, it should also be asked why Strong and Dixon, let alone the board, never bothered.

Perhaps the answer is complacency. Qantas had a domestic monopoly, and more recently a frequent flyer programme, that could prop up a loss-making international network. Cue the statement, "The Qantas Group has made an annual profit every year since 1995, a claim only two other major full service carriers can match."

The international network was critical as it gave the staple domestic passengers and corporations international flight options, thus creating a seamless single-carrier preference. As Qantas said in its application to the ACCC for a joint business agreement with American Airlines, "the viability of Qantas' entire portfolio of businesses depends on a viable international business."

But the status quo is no more. The trans-Pacific duopoly has ended and Asian and Middle Eastern carriers with lower cost bases have entered. What is not said is the future of Qantas domestic. While it may continue to be profitable, the yields and revenue volume should shrink as a result of Virgin Australia's entry into the corporate market.

Qantas, however, spent years--at least 15--being complacent. That is how a middle seat almost became standard in business class, enhanced benefits are only now being implemented with American Airlines, and, for an anecdotal reference, how flight attendants failed to pick up a dirty spoon.

Much is said by many people of declining service standards at Qantas. But rarely is systematic, not anecdotal, evidence presented.

"Service" is the keyword in the business today as Virgin Australia seeks to woo Qantas passengers based on both price and experience. As Virgin Australia chief executive remarked last week, "When V Australia started operating on the LA route, the average business class fare dropped by 20% and the average lowest economy fare by 40%. And may I say it was not at the expense of service. Our focus on excellent service and value has been rewarded by strong growth and critical acclaim."

INSIDE

• Virgin Group acquires Virgin Australia name and Internet domain virginaustralia.com.au
• Virgin Blue applying new name internally
• Virgin Blue executives appointed to Virgin Australia Airlines and Virgin Australia Holdings
  

Virgin Blue is in final stages to re-brand its domestic operation as Virgin Australia following the federal court siding with a claim from Sir Richard Branson's Virgin Group that a Victorian company was infringing on the Virgin Australia trademark.

The lawsuit's applicant, Virgin Enterprises Limited, the Virgin Group's London-based company that owns and leases over 2000 "Virgin" trademarks, trademarked the Virgin Australia name in February 2010 in 200 categories including air travel, seating reservation, loyalty programmes, passenger lounges, package tours, promotion of sport events, freight services, in-flight entertainment, limousine hire, airport parking, and model aeroplanes.

The court ordered the Victorian company, Virgin Australia Pty Limited, to legally change its name and be restrained from using the Virgin Australia name. On 24 February the company changed its name and Virgin Enterprises then reserved the Virgin Australia name, according to Australian Securities & Investments Commission filings, which were received on 25 February. Companies must submit a complete application within two months of their initial filing, leaving less than a fortnight for Virgin Enterprises to do so.

The court also ordered Virgin Australia to remove advertisements and listings in telephone directories across the country as well to remove content from its website at virginaustralia.com.au and then transfer the domain registration to Virgin Enterprises.

Virgin Enterprises is listed as the owner of the virginaustralia.com.au website that is now blank, a change that only occurred recently, sources familiar with the situation say. It is believed the transfer of the domain was one of the last external steps leading up to the public launch of the re-branded airline, Virgin Australia.

Virgin Enterprises owns the current Virgin Blue trademark and leases it to the airline. The same arrangement is expected to be in place for the Virgin Australia re-branding.

Virgin Blue is understood to have already taken the Virgin Australia name, stylised to resemble Virgin Atlantic's logo, and apply it internally in select circumstances.

Representatives of Virgin Enterprises were unavailable for comment. A Virgin Blue spokesman declines to comment on the lawsuit, saying "That litigation does not involve the Virgin Blue Group. It would be inappropriate for us to make any comment. We are not a party to it." As for the re-branding to Virgin Australia, the spokesman says: "We have not made any public statements on the outcome of the re-branding exercise."

The branding of Virgin Blue's international operations is unconfirmed. The Virgin Group has established holding companies including Virgin Australia Holdings Pty Limited, registered in 2000, and Virgin Australia Airlines, registered in 2007. Virgin Blue executives have recently been listed with both organisations as company officeholders. Sean Donohue, group executive operations, was most recently added on 23 March, according to the ASIC. The Virgin Blue spokesman was unable to comment on the appointments.

Incidentally, the previous owner of the Virgin Australia Twitter account has been suspended, paving the way for the carrier to acquire it. On Facebook, the username and web extension facebook.com/virginaustralia is available.

The re-branding could be announced early next month when Sir Richard Branson will be in the region after serving as a flight attendant on an AirAsia X flight from London to Kuala Lumpur. It is believed Virgin Blue hoped to announce the re-branding, with Branson's presence, in February but the trademark infringement delayed the announcement.

Last year Virgin offered the Virgin Australia business holders a figure in the low tens of thousands of dollars to surrender their business name and Internet domain, but the company counter-offered an amount in excess of one million dollars, sources familiar with the situation say. Virgin Enterprises then filed its suit on 25 November. There were two mediation sessions although it is unknown if the previous Virgin Australia name owners received any compensation.

Virgin Australia Pty Limited had exclusively sold promotional and corporate gift "Easyreader" bookmarks that feature a sliding indicator (light blue panel, right) to remind readers where they left off in a passage, archived versions of its website indicate. Its slogan beckoned, "Easy reading with Easyreader". There was no explanation linking the company or the Easyreader bookmark to its Virgin Australia company name, which it registered in April 2004, according to the Australian Government.

The company's website carried the disclaimer that Virgin Australia "is an Australian owned company, founded in March 1991 in accordance with all Australian Government and Corporate Laws. Virgin Australia wishes to make it clear, that it does not want to be confused or associated with Sir Richard Branson's - Virgin group of companies."

The previous owners of Virgin Australia used a logo featuring a boomerang and Southern Cross constellation (right), design elements used by Virgin Blue and V Australia, but it is not immediately clear how contentious the logo was in the lawsuit. The company changed its name to Easyreader Pty Limited. It could not be reached for comment.

The lawsuit's resolution was finalised on 24 February, the day Virgin Blue chief executive John Borghetti and senior management left for Abu Dhabi on V Australia's inaugural service to the UAE capital.

Borghetti has said the re-branding, which could consist of multiple brands, would be unveiled before the end of the financial year on 30 June.

Virgin Enterprises' lawsuit also filed trademark infringement against the owner of the websites virginadultproducts.com.au and virginap.com. The court ordered the website domains to be transferred to Virgin Enterprises. It is understood Virgin Enterprises taking possession of those websites was unrelated to the airline's re-branding.

Some stories are so sensationalist and lacking in objectivity that they deserve not to be talked about, especially when there are real and substantial safety matters elsewhere.

Such, I thought, was the Daily Telegraph's article (I use that term loosely) that a group of Qantas flight attendants and pilots are upset over John Travolta's cameo in the safety video shown on most Qantas flights.

Now the story has gone viral and deserves for the record to be set straight.

For context, the video is four months old now. Why is it an issue now? With Qantas management possibly taking a preemptive strike last month to galvanize support for the company as it enters labour negotiations, are unions using this matter to have the public be on their side instead of management's?

For the facts, Qantas employees take issue with two matters. First is Travolta's use of the word "team" to refer to employees working the flight. Travolta says in the video's introduction:

This is your captain speaking--well, maybe not today. But I can guarantee that the guys on the flight deck and the greater team care just as much about aircraft safety as I do. I've been flying over 40 years as a pilot and I can tell you, there's no one I'd rather have at the controls than a Qantas pilot.

Employee commentators say they would prefer the word "crew". After Travolta's cameo, the video alternates between "crew" and "team". Anecdotal comments from pilots on Twitter say they would prefer "crew" to "team", but that there is a blurry line that makes this issue a moot point.

"Crew resource management is about teamwork," one comment says. Another equates the crew/team debate to one in the police profession over if members are part of a "force" or "service", with the conclusion the debate "doesn't change the dynamic of the operation". It shouldn't change aviation either.

The second matter the group takes issue with is Travolta introducing the video instead of a "real pilot". (Travolta is a real pilot, flying his 707 to Australia as recent as last November for Qantas's 90th birthday celebrations, but I'll presume the Qantas employee means a "real Qantas pilot".) Travolta's featuring in the video is all marketing and image-related, and that's fine. Sir Richard Branson has his share of cameos too.

The Telegraph quotes one Qantas staffer calling for Captain de Crespigny, who was in control of VH-OQA during the QF32 incident last November, to introduce the video. With all due respect to de Crespigny, would you want a safety video to be introduced by a pilot who says he saved 450-odd people from erupting into flames mid-air on the same airline you're about to fly with? (It's humorous to imagine the comments Qantas crews might have if management took their suggestion. Damned if you, damned if you don't.)

The one genuine issue I can see with the video is Travolta ignoring gender equality when referring to the "guys on the flight deck". But I'm not going to be the one to raise that issue.

Two photos featuring Elle Macpherson, who Virgin Blue brought in to help launch the uniforms. Elle jokingly thanked everyone for purchasing her lingerie.And here is Juli Grbac, who designed the uniforms.

Engineers conduct a borescope investigation of the no. 2 Trent 900 engine on Qantas A380 VH-OQC in Sydney on 6 November. Photo: Will Horton

Last Friday night Andrew Dudgeon naturally took to the stage precariously.

The chief executive of Rolls-Royce Australasia was to present the technical story of the year award at the National Aviation Press Club dinner in Sydney, and earlier that day the ATSB released its preliminary report into the uncontained engine failure on a Rolls-Royce Trent 900-powered Qantas A380.

Rolls-Royce had hitherto said little. Its press conference after the 4 November incident confirmed barley anything more than Rolls-Royce manufactured the Trent 900. The powerplant manufacturer even canceled a press conference at China's Zhuhai airshow.

As the audience applauded Dudgeon's short speech of support to airlines, I contemplated his last remark: "No aircraft will fly unless it is safe to do so."

That should be aviation's guiding principle.

But is that what Rolls-Royce has neglected?

The puzzling circumstance after the QF32 incident on 4 November is that Rolls-Royce appeared to know what the problem was, and where else it might re-occur.

As we reported for our news wire Air Transport Intelligence:

Lufthansa's decision to change an engine on its first Airbus A380, in response to the Qantas incident, has partly been driven by the fact that the powerplant was an early production example.

Sources familiar with the process state that one engine on the Lufthansa aircraft was from a "former production cycle", indicating that the other three powerplants had already undergone a change before being fitted.

On 10 November Singapore Airlines announced it would recall three of its A380s back to Singapore to change one engine on each aircraft. Although the aircraft were on two continents outside of Singapore's Changi base, Singapore knew exactly which engines it needed to change. But how?

What we learned since is that the problem--in short: fatigue cracking, thinning pipe wall--was limited to "A mod" and "B mod" versions of the Trent 900. "C mod" versions were not affected. Thus Rolls-Royce could identify which engines were at risk to experience a similar failure.

The implications, my colleagues have written, are:

This appears to indicate that Rolls-Royce may have identified the fault and fixed it on the latest engine variant. It is not clear, however, when the fix was implemented.

While the latest, "C mod", version of the Trent 900 would have been fixed, the earlier "A mod" and "B mod" versions were neglected. Qantas says at the time of the incident Rolls-Royce had repaired only one of the 24 Trent 900s on Qantas A380s. (Qantas contracted Rolls-Royce's TotalCare maintenance program to look after and repair its A380 engines, so the carrier is not to blame.)

Did Rolls-Royce underestimate the potential severity of the fault? It may have been acute ignorance, but you have to hope that was the circumstance and not a determination far worse: negligence, which is what Qantas alleges.

Update, Thursday morning: We've heard from Rolls-Royce. They dither on what modifications occurred and if the "C mod" Trent 900 was affected (read more here), but their statements conflict with those from airlines.

What Rolls-Royce knew and did may never be known. Not even Qantas chief executive Alan Joyce was clear on Trent 900 modifications made prior to 4 November.

Joyce said last month: "It doesn't look like it's a significant modification, but it is a modification that has an impact on how the engines are performing. And it is a modification that indicates whether you are going to have a problem or not with the engine."

To paraphrase Dudgeon, Rolls-Royce will not permit an aircraft to fly with the potential, generic problem Joyce references.

But Joyce had a problem on a Trent 900 and ended up with a grounded A380 fleet that still cannot cross the Pacific due to thrust restrictions.

If Rolls-Royce is only now playing public-relations catch-up by declaring no unsafe jet will fly on its watch, Rolls-Royce's customers are seeing right through it. As Joyce said of the Trent 900 modification, "If this was significant and was known to be significant, we would have liked to have known about that...We and Airbus weren't aware of it."

A mere month ago at an aviation gathering, I sat next to a Virgin Blue PR rep who was still distraught over the previous week's firing of the group's GM of Public Affairs, Heather Jeffery. The move occurred only three days after former Qantas executive John Borghetti took over from founder Brett Godfrey, a timing that was no coincidence. With trepidation but always loyal to the airline, the PR rep said they would simply have to move on. Today however she became the latest person Virgin Blue would have to move on without.

"I've been told by the new management that moving forward my services are no longer required and my role is redundant," she writes in a message. Last week Travel Weekly reported Borghetti hired former Qantas GM of Government and International Relations, Qantas's former head of pricing, Will Owens, and previously hired Creative Holidays MD Justin Montgomery to be Virgin Blue's GM for sales.

This industry's revolving door can be sped up during management turnover. So far Borghetti's changes are a hallmark of Qantas, unsurprising since he came from that carrier, but noteworthy for the negative effect industry sources say such shakeups had on Qantas. There was distancing between management tiers, loss of camadere, and detachment from the airline. The at times lackluster employees and service did not resonate with passengers.

Will this be fun-loving, easy-going Virgin Blue's fate?

It's too early to say, especially since major announcements about positioning the carrier up market with a business product, reviewing destinations, and uniting the brand are all forthcoming.

Airline markets elsewhere in the world might be finding new lows to reach--the US domestic market in general, "standing seats"--but in this small region there is still class, and Virgin Blue has exemplified it since its 2000 launch.

If Virgin Blue wants to lose this passenger-oriented position, can it sustain itself with higher yielding fares, or against the cheaper Jetstar and Tiger? Could the latter vamp up their identity and fill the void? Virgin Group CEO Richard Branson talks about the provocative effect the group has achieved of using "Virgin" in a brand name, but there's always more to a name. With whatever more Borghetti adds, will passengers use their wallet to vote in favour?