Electronic documents replacing boarding passes and other travel papers will be the most important airport IT and telecommunications trend in the next three years, according to IT chiefs. And although paperless travel options may be thin on the ground right now, plenty of airports are planning to roll out self-service options to passengers' mobile phones by 2012.
Results of the Airport IT Trends Survey 2009, commissioned by Airline Business in partnership with Airports Council International and SITA, show that by 2012 roughly half of all airports will be offering a raft of mobile phone services. The list includes mobile-optimised web sites, flight status notifications and targeted retail promotions. In addition, within three years, roughly a third plan to automate gates, security point processing using bar-coded boarding passes and offer in-terminal entertainment download options.
But the push on mobile offerings does not mean other self-service technologies are taking a back seat. All but a small minority will implement check-in kiosks within three years, and over half are planning to evolve their kiosks to print bag tags and scan passports.
Now in its sixth year, the Airport IT Trends Survey 2009attracted a record 106 responses, giving the views of over 172 airports worldwide. They total 69% of revenue and 60% of traffic among the Airline Business
Top 100 Airports Financial & Traffic Ranking 2009.
With much activity on the self-service front, unsurprisingly airport IT&T investment has remained fairly stable. Airport long-term business and investment plans have not been subject to the same volatility as airlines. And, while airport IT bosses are being prudent in terms of targeting their investment activities, for many it has been business as usual.
The survey results, presented at November's ACI World general assembly in Kuala Lumpur, reveal that on a revenue-weighted basis the 106 respondents invested an average of 2.9% of revenues into IT&T during the 2008 financial year. But looking at the airports which responded to the survey both this year and last year, revenue-weighted IT&T investment levels remained almost unchanged, slipping to 3.2% from 3.5% in 2007.
Turning to this year, they are expecting a revenue-weighted operating spend of 2.4% of turnover. And, for the first time, the survey also asked about planned IT&T capital spend, which stands at an industry average of 1.9% of total revenues on a weighted basis.
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Less than a third of airports reported a decrease in their revenue-weighted IT spend compared with last year and roughly 40% said it had increased. For the remaining 29% it remained stable. And the outlook for 2010 is more buoyant, with only 14% forecasting a decrease, 45% anticipating an increase and 41% saying it will remain the same.
To counter the tough climate, over two-thirds of airports are planning further investment in organisational productivity and efficiency applications and the same proportion are looking to invest in IT infrastructure consolidation, such as virtualisation. Roughly two-thirds are looking to plough some of their IT spend into lowering enterprise costs.
Playing The Long Game
But while times may be tough, the vast majority are not planning to cut their IT headcount, nor are they looking to increase returns on investment in under one year. "This is confirmation that although airports are evaluating major capital programmes during the economic downturn, investment in IT continues to be an important way to reduce costs and improve efficiencies," says Catherine Mayer, SITA vice-president, airport solutions.
She adds: "These low priorities confirm that airports are not interested in short-term fixes that may hinder long-term growth and IT strategy benefits. Airports are reinforcing that IT is an integral part of their business and operations [both present and future]."
Thelong-term nature of airport decision making is shown by Melbourne Airport in Australia investing heavily in its network infrastructure to meet demands from a greater number of tenants and devices on the system. It is also expanding existing services and adding in new ones, such as a wireless network throughout the terminal, aprons and bays. The benefit, says information technology manager Mark Funston, is "it gives us the ability to decrease business processes and cut out the number of IT systems we need to install in future expanding areas. That being said, we have tried to minimise our operational budget as well because of the global financial crisis".
Taking the long view in the UK, Manchester Airports Group's investment in technology has more or less remained unchanged despite the recession. "The expectation was that this year was going to be tough and next year won't be too easy either," says director of group technology and innovation Martin Smith. "In terms of the whole business planning process we tailored that in."
The findings of the 2008 Airport IT Trends Survey click here
He adds: "In any one year we probably spend half our investment on normal renewals, next generation activity and, depending on the year, we might be spending about the same again on new things. We are not in the situation where the things we have got to do are completely pulling investment away from the things we want to do to move business and passenger experience forward."
Incheon International Airport in South Korea has also maintained its IT spend throughout the crisis and is now planning to increase its investment levels in the area ofpassenger facilitation. "We are focusing on self-service through e-passports and mobile phones,' says Hyong-kyu Choi, IILC's director of U-airport Team. "In the future, if a passenger has their own e-passport and mobile phone, they will pass through immigration and security [simultaneously] and board very quickly without a boarding pass."
The Incheon vision is reflectedby the Airport IT Trends Survey, with 52% of airports saying electronic documentation for travellers and aircraft will have the greatest impact on infrastructure and systems over the next three years. This fits in nicely with passenger preferences for a simpler journey. Mayer from SITA says: "Passengers interviewed in the 2009 SITA Passenger Self-Service Survey confirm the importance of a paperless travel experience, as 49% would prefer to have an electronic version of their boarding pass, versus 44% preferring a paper version. Over 70% have a positive attitude towards using an electronic travel folder as a single repository, whether on a card or on cell phone, which would store all travel-related items."
Industry initiatives, like IATA's Fast Travel scheme, are adding to the momentum, as is the scramble by airports -and airlines for that matter -to offer passengers mobile services to streamline their journey. A critical factor will be the convergence other technologies, such as Bluetooth and near-field communications, with mobile phones. "There's potential for near-field devices, which have started to take off in Japan in terms of contactless payment," says Smith from Manchester Airports Group. "2D barcodes are being widely used for home check-in and I would see that moving to contactless communications so people can be there and virtually do nothing at key points."
Canada's Montreal-Trudeau Airport is already fully 2D barcode compliant. "A passenger checks in today and, if they are travelling in Canada, they can travel 100% paperless," says business development director Antoine Rostworowski. "They can use a mobile 2D barcode to print a bag tag or document, or go straight to security and have the 2D barcode read by an assistant and actually board, if the airline allows that."
Topping off the list of passenger mobile device services is flight status notifications. This is already offered by 32% of airports and is set to reach 50% by the end of next year, increasing to 64% by late 2012. Mobile phone-optimised websites are currently offered by 18% of airports, and this is expected to reach 52% within the next three years. In the same time frame, airports targeting passengers with retail promotions on their mobiles are set to grow to 47% from just 10%.
The survey also reveals that today there are a raft of other mobile services offered by a minority - broadly 10% or fewer - which are set to gain greater traction within the next three years. By the close of 2012, 34% of airports will automate security point access using bar-coded boarding passes. Those providing entertainment downloads will grow to 35% and automatic gate and boarding processing will increase to 33%.
Mobile applications also give airports the opportunity for real-time interaction with passengers, something which Manchester is utilising via micro-blogging website Twitter. Through Twitter it is able to provide service updates and offer real-time flight status updates. Passengers can also give feedback on the airport services as they use them. "We are interested in having a real-time dialogue with our travelling passengers and the best time to capture that is in the moment," says Smith, who describes uptake as reasonable. "We are not dealing with hundreds per day, but we are getting enough information through to make it a useful supplement to what we already do."
One of the mobile tools under investigation at San Francisco International Airport is parking space reservation. Chief information officer John Payne says this could allow frequent flyers to access their favourite parking spot for a small premium. "It's working out how to do that, or telling customers 'here's the available number of parking spaces on each floor'. The next step could be guiding you to an open space via the cell phone."
Butmobile services still present some challenges, including reformatting content for the mobile web. Payne says: "Usually it requires a significant rethink on how the application presents information. One that still needs to be resolved is how to pay for a service on a per transaction basis if a fee-based model is used. This can be minimised via sign-up ahead of time, for example SMS alerts."
Melbourne is planning a number of mobile services, including movie downloads for mobile devices for passengers to view in-flight, as well as a flight information subscription service for taxi drivers so they can base their availability on passenger demand. Melbourne's IT chief Funston says most of the initiatives are focussed on optimising and speeding up the airport experience, or giving passengers something extra. But he adds: "The only real challenges are around legislation and that's realistically what can we offer, do we need to have any content control or digital rights management over any content we offer, particularly video, and how to achieve it with upstream service providers."
Perhaps the greatest mobile services challenge for airports is gaining acceptance among partner organisations and regulators. "On the regulatory and governance sides, some are reluctant to have direct passenger interchange because they consider it intrusive on passenger rights. Or it could be a problem if only airlines want to have the interaction with passengers," explains ACI manager for facilitation andairport IT Arturo Garcia-Alonso,
However, he believes service delivery is more important than issues of ownership. "It's looking into how we can offer what the passenger needs and it doesn't matter if it is the airport or the airline offering it."
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