The Skift Airline Innovation Report is our weekly newsletter focused on the business of airline innovation. We will look closely at the technological, financial, and design trends at airlines and airports that are driving the next-gen aviation industry.
We provide insights on need-to-know developments in passenger experience, ancillary services, revenue management, loyalty, technology, marketing, airport innovation, the competitive landscape, startups, and changing passenger behavior. The newsletter, sent on Wednesdays, is written and curated by me. We will look closely at the technological, financial, and design trends at airlines and airports that are driving the next-generation aviation industry. You can find previous issues of the newsletter here.
What’s the point of embedded in-flight entertainment systems?
They’re heavy. They’re not as sophisticated as consumer electronics. They break more often than airlines would like. They rarely have enough content to satisfy all passenger segments. And, because of the lead time required to produce, certify and install the systems, they’re often technologically obsolete before their first flight.
Yet they persist. Almost every full-service airline installs in-seat screens on all long-haul planes. Some, such as Singapore Airlines and Emirates and even Delta Air Lines, use screens as a competitive advantage, loading them with high-definition content people want to watch. But for many others, entertainment seems like an afterthought — something airlines feel they must provide, but don’t put much effort into.
A few airlines have given up. Mostly, these are discounters, including Norwegian Air on its Boeing 737 Max, and Wow Air. But other airlines have begun to take similar approaches for midrange flights. Qantas doesn’t have screens on some A330s, instead giving iPads for longer domestic routes. And United Airlines didn’t put embedded systems into its revamped high-density Boeing 777s. Mostly, they fly shorter domestic routes, but they’re also used on Guam-Honolulu, a seven-hour flight. (We’ve heard rumors these cost-friendly United aircraft may fly to Europe soon.)
I don’t understand why screens are so sacrosanct. In so many ways, from flyer programs to lounges to segmented onboard products, airlines cater to their highest-value customers. But business travelers rarely choose airlines for in-flight entertainment. If they want entertainment, they can load their tablets with what they want to see — not what the airline chooses. If customers pick an airline based on screens, they’re probably leisure customers of lower value to the airline.
What do business travelers want? Well, I have recently become one — Skift sends me on trips often to learn about airline trends — and I think I am beginning to understand what road warriors crave. We need reliable Wi-Fi. It doesn’t need to be super fast, but must be good enough for the basics. In 2017, I can’t lose a day of productivity because an airline has prioritized entertainment over Wi-Fi. When my CEO needs me, he expects a response.
This week, we published an interview with Jon Norris, senior director for corporate sales and marketing at Panasonic Avionics. I tried to ask (gently) whether there’s a future for embedded systems. Norris is a salesman, so of course he sees a bright future. But I’m not so optimistic. Remember, embedded in-flight entertainment has only been around for a couple of decades — before that we watched movies on overhead screens. Embedded systems may not last forever.
What do you think? Does embedded in-flight entertainment have a long-term future? Email me your thoughts to firstname.lastname@example.org or on Twitter. I’m @briansumers. Or, if you’re feeling adventurous, follow me on Instagram, and send me a note there. I’m @bsumers.
— Brian Sumers, Airline Business Reporter
What’s coming up
I’ve been working on a longer story about why many airlines have fallen behind with their e-commerce strategies. My favorite quote comes from Peter Glade, commericial director for Sun Express, a European leisure airline owned by Lufthansa and Turkish Airlines. He told me airlines must improve their approaches, or another company — perhaps Google or Amazon, or even another firm that doesn’t exist yet — will handle retailing for them.
In short, he said, an airline must decide whether it wants to be Uber, or the Uber driver.
“Our decision as an airline shall be, ‘Am I the one that is transporting the passenger from A to B, or am I the one that is managing the problem that the customer has to an extent so that the customer is happy and wants to fly with me again,'” Glade told me. “Do I want to be a transportation organization or a problem solver?”
What do you think of his analogy?
Most Interesting Stories of the Week
Interview: Why In-Flight Entertainment Screens May Persist on Long-Haul Routes: As I mentioned, Panasonic’s Jon Norris is the latest subject in my new interview series called Airline Insiders, in which I introduce readers to executives with interesting jobs. My next two interviews are with the vice president for innovation at Gate Group, and the director of planning at Allegiant Air. Do you know of someone I might interview next? The only requirement: All subjects must have a playful sense of humor. Email me if you want in.
J.D. Power Finds U.S. Frequent Flyers Prefer JetBlue’s Loyalty Program: J.D. Power ranks everything, including cars, electronics and banks. A few years ago, it started ranking airline loyalty programs, and this year, it claims it interviewed 3,400 Americans to determine their favorites. The winner was JetBlue — a surprise to those of us who cover loyalty. JetBlue offers an easy-to-understand program, but it’s far from the most generous. “JetBlue has a regional and simple program but doesn’t offer much of an opportunity beyond simple rebates,” Gary Leff, of ViewFromTheWing, told me. J.D. Power didn’t share its methodology, so we don’t know what questions the company asked.
Surf Air Positions Itself for the Post-Brexit Commuter: California-based all-you-can-fly airline Surf Air often reinvents itself. Management changes often, as does the airline’s route network. Yes, Surf Air has consistently flown California short-haul flights since it started in 2013, but the company has been constantly searching for the next-best-thing. Surf Air recently expanded to Europe, where it expects its subscription business will thrive, with full members paying more than $4,000 per month to fly as much as they want from private terminals in London, Cannes, Ibiza and Zurich. Colin Nagy’s Skift’s business travel columnist, thinks it can thrive. I’m less sure.
VietJet Mulls U.S. Route With Widebody Planes: Low-cost airline VietJet wants to acquire big jets and fly from Vietnam to California as soon as 2019, according to a Bloomberg story posted on Skift. We commend VietJet for disrupting the Southeast Asia short-haul market, but long-haul operations are another story. Yes, lots of Vietnamese-Americans live in Southern California, but this cannot be a good idea. Brendan Sobie, an analyst with CAPA – Centre for Aviation, put it better. “The prospect of making money on this route is bleak,” he said.
Emirates Upgrades First-Class Suites While Competitors Downplay Such Luxury: In September, I interviewed Emirates President Tim Clark in London, and he promised the airline’s new suites would be “game changers.” It’s an overused phrase, but perhaps it was apt. Emirates introduced its new first class for the Boeing 777-300ER, and Bloomberg reports it has all the over-the-top luxury you’d expect — including technology that creates fake window views for passengers in middle seats. Oddly, Emirates isn’t in a rush to reconfigure most of the fleet, and some aircraft may never get the new suite. Travelers may book the 777-300ER thinking they’ll get it, only to be disappointed.
Investment Group Plans to Bring World Airways Back From the Dead: Apparently Ed Wegel knows only one formula — resurrecting defunct airlines using old logos and newer planes. Several years ago, he brought back Eastern Air Lines, and many reporters — including me, for Conde Nast Traveler — wrote light-hearted stories about airline nostalgia. But the new Eastern didn’t grow as Wegel promised, and earlier this year some of its assets were purchased by charter operator Swift Air. Wegel has a new project — recreating World Airways. He told Bloomberg his investment group wants to acquire 10 Boeing 787s. Then again, when he led Eastern, the airline ordered at least 20 Mitsubishi MRJ90s, an aircraft the airline nicknamed, the “Eastern Whisperjet.”
Other Stories of note
Emirates Looks Past Turmoil With Huge Boeing Deal: Emirates has historically bought the biggest jets from Airbus and Boeing, but its strategy is changing slightly, Jon Ostrower wrote for CNN. The airline announced a big order this week for Boeing 787-10s. It’s still a big plane, but it’s no A380. “It gives us far more in our arsenal to deal with the type segmentation of demand that we’re looking at in the next decade,” Emirates CEO Tim Clark told CNN.
More Airlines Suspend Use of Onboard Caterer After Listeria Detection: What’s happening at Gate Gourmet’s kitchen at LAX? At least three airlines have temporarily dropped the caterer, including American Airlines and Delta Air Lines. They say they’re concerned Listeria has been found on some surfaces. I spoke late last week with a Gate Gourmet executive, and she said it’s not a big deal, and the kitchen is safe. The airlines say otherwise. Leslie Josephs of CNBC has the story.
On Airplanes, Considering Fighting Cameras With Cameras: Should airline employees wear body cameras to protect against passengers who might make complaints? That seems a bit extreme, but The New York Times reported this week some airline employees want cameras. One of the world’s largest carriers, American Airlines, has no plans to use them, spokesman Ross Feinstein said, but it is concerned some passengers do not behave with proper decorum. “People are putting their phone up, saying, ‘You better book me on the next flight,’” he told the Times. “They’re trained to intimidate our crew members using their phone.”
The Skift Airline Innovation Report is curated by Skift Airline Business Reporter Brian Sumers [email@example.com]. The newsletter is emailed every Wednesday.