The Rise of the Emerging Market Traveler Sponsored This content is created collaboratively with one of our sponsors.
Despite stalled growth in China, Brazil and Russia, a wave of newly middle-class travelers from the BRICs and beyond will start visiting international destinations in the coming decades — dwarfing the numbers we’ve seen thus far.
JetBlue hasn’t done itself any favors with business travelers by waiting for so long to get its Wi-Fi going. The enhanced functionality had better live up to what the airline is promising.
JetBlue CEO David Barger confirmed today that the airline will begin to test satellite-based Wi-Fi on some aircraft during the first quarter, and he said the first installations will be free.
JetBlue doesn’t expect to have Wi-Fi available fleetwide until 2016 or 2017, and didn’t provide any details on what the service might cost in the future. There has been talk in the past about several tiers of service.
The Wi-Fi service comes from subsidiary LiveTV and is based on Ka-band satellite technology.
Has JetBlue lost its Mojo?
During a conference call about fourth quarter earnings today, an analyst asked Barger if the airline should still be considered an innovator as it was in its early days, or whether it is soley financially focused these days.
JetBlue’s Wi-Fi service “will certainly be disruptive to the cabin experience,” Barger replied, citing its speed, bandwidth, and the initially free cost of the service.
Barger said the airline certainly is “financially driven,” and he noted that JetBlue has been criticized for being very slow to adopt Wi-Fi.
However, Barger said the airline’s implementation of Ka-band-based Wi-Fi is “exciting,” adding “you can certainly think of us as being an innovator and disruptor in this industry.”
- CFO Mark Powers said the airline attracted about $20 in ancillary revenue per passenger in the fourth quarter of 2012, and that was driven by its Even More product. Ancillary revenue grew about 10%, or $50 million, during the quarter, he said.
- Powers said JetBlue’s LiveTV subsidiary’s financial impact is not material to JetBlue’s financial results, although he positioned it as the engine that will enable the airline to “take an innovative lead.”
- JetBlue’s route network has about a 11% overlap with Virgin America and the latter’s reduction in transcontinental capacity over the last year has benefited the industry’s “fare environment,” said Robin Hayes, JetBlue’s chief commercial officer.
- Hayes called for additional marketing of the U.S. as an attractive destination for inbound tourism. Providing an efficient way for tourists to clear customs and immigration can “only be helpful as far as creating demand and improving things for the industry here,” Hayes added.