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@jwrichte09 ﬂying is so much more enjoyable with internet access, love the @Gogo ﬂight tracker. Thanks @Delta34 DESTINED TO BE FREE? The pay-for-service model for inﬂight Wi-Fi is under pressure. Social media guru Shashank The pay-for-service model for inﬂight Wi-Fi is under pressure. Social media guru Shashank Nigam of consultancy SimpliFlying makes a case for why the service should be free Nigam of consultancy SimpliFlying makes a case for why the service should be free WORDS BY SHASHANK NIGAM ILLUSTRATION BY CALLUM LEWIS APRIL 2012APEX_APRIL2012_034_038_Connectivity_CL_jo_AG_j_f_JF.indd 34 13/03/2012 11:08
IFEC 35 @hharteveldt Feeling very 21st century: I just pre-ordered Steve Jobs’ autobiography for my Mom’s Kindle using @Gogo in-ﬂight Wi-Fi on @Delta LATE LAST year, well-known aviation industry shared over 10 photos of her travels, analyst Henry Harteveldt boarded a Wi- showcasing everything from the Swiss Fi-equipped Delta Air Lines ﬂ ight from San Air lounge she visited at JFK to the ANA Francisco. Being the early adopter of technology Boeing 787 she saw in Frankfurt. Her social that he is, Harteveldt continued his connected activity wasn’t just a one-way broadcast – she being lifestyle at 35,000ft just as he would from his received 89 reply tweets during her journey. online in living room. After paying for his Gogo Wi-Fi While Yeo might seem over-active on ﬂ ight, Yeo said connection, he went on to pre-order Steve Jobs’ social media during her travels, she’s not she’s “happy to disconnect biography for his mother’s Amazon Kindle. an exception. A recent study we conducted while ﬂying”. Interestingly, for Then came a tweet exalting the feat. at SimpliFlying showed that frequent ﬂ iers a large majority of travellers who are on Wi-Fi Across the continent in Washington, DC, in are twice as likely to use social media as the equipped ﬂ ights, the experience is similar. They early January, aviation journalist Ghim-Lay average US adult. simply do not get online while in ﬂ ight. But Yeo was travelling to Singapore. During her 28- Despite the surge in activity while she was there’s more to the story than just their need for hour journey from the US capital via New York travelling, the reality is that Yeo only tweeted solitude at 35,000ft. and Frankfurt, Yeo sent out 71 tweets, updated from the ground. That’s because the Singapore In the USA, inﬂ ight connectivity provider her Facebook status 12 times and checked in on Airlines Airbus A380 she ﬂew on is not yet Gogo’s air-to-ground (ATG)-based system Foursquare eight times. While she was at it, she equipped with Wi-Fi. When asked if she missed is installed and ﬂying on some 1,166 aircraft APEX | AIRLINE PASSENGER EXPERIENCEAPEX_APRIL2012_034_038_Connectivity_CL_jo_AG_j_f_JF.indd 35 13/03/2012 11:08
IFEC that operate principally over the contiguous THE FREQUENT FLYER PARTICIPATION LADDER domestic states. But papers ﬁ led by the company for an IPO of shares reveal an abysmal paid-usage rate of less than ﬁve per cent. FREQUENT FLIERS Typically, Wi-Fi costs USD12.95 for a 24-hour period on Gogo and a little less for connecting mobile devices only. 27% Despite the low percentage of travellers using Wi-Fi, the number is likely to rise as more satellite-based Wi-Fi systems are installed on international aircraft. Across the Atlantic, Lufthansa – the largest customer of Connexion 38% by Boeing’s now defunct inﬂ ight connectivity US ADULT ONLINE service – has reignited its so-called FlyNet Wi-Fi service in partnership with Panasonic CONSUMERS Avionics, and is ﬁtting the rest of its long-haul CREATOR 13% (publish content) ﬂeet with Panasonic’s system. Middle East carriers like Emirates, Oman Air and Gulf 18% Air are also aggressively ﬁtting their ﬂeets with connectivity. 19% CRITIC (comment and post) The tipping point for inﬂ ight Wi-Fi 28% availability (as opposed to usage) is near. Yet, as 15% revealed by Gogo, the percentage of travellers COLLECTOR connecting in ﬂight – at least on US domestic (use RSS or feed readers) routes – isn’t nearly the same. A few factors can explain this conundrum. 19% First is the issue of pricing. Travellers today JOINERS already feel nickel-and-dimed to the max by (publish, comment, share) 54% airlines charging for everything from bags to food. So paying extra for Wi-Fi seems like yet 33%36 another expense that most travellers may not SPECTATOR be willing to incur unless absolutely necessary. (read, watch but don’t interact) Moreover, since the technology is new, there are also connectivity issues. The speed can be slow if a lot of people are logged in at the same time – during free Wi-Fi promos, for LESSONS FROM AIRPORTS deﬁ nitely be open to [free Wi-Fi] if there are instance. As one traveller commented on the To make inﬂight Wi-Fi commercially viable, suﬃcient alternative revenue sources.” APEX Editor’s blog, “The Gogo stuﬀ just doesn’t perhaps airlines need not look farther than work well in the air. Too many dead spots and airports. Since Toronto Pearson International GET THEM HOOKED! connectivity issues.” If people pay for it, they Airport made Wi-Fi available free of charge, One of the potential reasons for the low Wi-Fi expect reliability, which is something the usage has jumped ten-fold. Las Vegas Airport adoption rate in ﬂ ight is that most travellers, suppliers are working on. oﬃcials carry around badges at conferences like Ghim-Lay, don’t miss it enough. They don’t Unfortunately, at the current usage rate, it that tout the beneﬁts of free Wi-Fi, a testament appear to see the need for it yet, since most of may take decades before airlines are able to to the fact that giving free Wi-Fi has worked them have never been exposed to the beneﬁts. recoup their investment of equipping their well for them. Airlines could consider following the aircraft with Wi-Fi (though several airline An increase in the number of users in ﬂ ight business model of WhatsApp, which is like a customers of Gogo enjoy revenue-share would give rise to the walled-garden eﬀect. Blackberry Messenger for all smart phones – it agreements with the provider). The captive customer, connected to the internet allows people to text one another for free. The The inﬂight Wi-Fi business model needs while in the air for seven to 20 hours, is a mobile app is free for the ﬁ rst year and charges to be commercially sustainable to prevent it treasure trove for marketers. There are multiple a minimal fee from the second year onwards. becoming a huge liability for airlines. revenue opportunities here, from advertising The crux is that the free model upfront is Azran Osman-Rani, the CEO of AirAsia X on the landing page to getting a commission driving membership and then earning huge on purchases the revenues simply by dint of the volumes gained. customers make Once airlines make inﬂ ight Wi-Fi @Craig Elimeliah while in ﬂ ight. In this regard, indispensable for most travellers, surely a larger number would eventually be willing to pay a the @Gogo Wiﬁ on this ﬂight is airlines need reasonable amount to keep their “habit”. to learn from To drive further adoption, airlines should also spotty and keeps losing signal Starbucks, a brand look into making it easier to pay for inﬂ ight Wi- that has done a Fi. They could make Wi-Fi an ancillary add-on wonderful job that could be acquired by customers at the point says, “As a low-cost carrier, we have to ensure of getting customers hooked to its largely free of ticket purchase. Inﬂ ight GSM/GPRS services that any additional costs incurred have to be internet service and now cross-sell and up-sell are charged to passengers’ monthly phone bills, supported with revenue generation [before a variety of products and services. and many businesses cover the cost of employee installing inﬂ ight Wi-Fi].” Osman-Rani of AirAsia X notes, “We would cell phone usage. Once 3G mobile services APRIL 2012APEX_APRIL2012_034_038_Connectivity_CL_jo_AG_j_f_JF.indd 36 13/03/2012 11:08