David Coiley, Vice President Aviation, Inmarsat.
The AeroConnect 2017 Conference was held on Tuesday 31st October at the Renaissance Hotel near Heathrow and reflected the rising interest in inflight connectivity.
Organised by the GVF / EMP Conference Partnership, this ‘free to attend’ event featured a keynote presentation entitled “Online, Anywhere, Everywhere: The Passenger at 35,000 feet”, delivered by David Coiley, Vice President Aviation, Inmarsat.
Coiley said: “We believe it is not a question of ‘if’ passengers want connectivity, but ‘how’.
“Our GFK research with 9,000 passengers in 18 countries shows that passengers will pay for connectivity. It found 77% of passengers would pay for IFC even on short leisure flights and 60% now believe that inflight Wi-Fi is a necessity not a luxury.
“Passengers will pay as long as they get a good reliable service. This year we saw a change from IFC from being a nice to have to a necessity.
“And 47% of business travellers agreed with the statement: ‘I feel like I’m wasting my time because I don’t have Wi-Fi in flight.’
“It is not just about business travellers either. 68% of respondents said inflight Wi-Fi is a ‘life saver’ when helping to keep children occupied during flights. And 71% of inflight connectivity users travelling with children connected more than one device,” Coiley said.
Sky High Economics and connectivity
He added that Inmarsat’s recent “Sky High Economics: Quantifying the commercial opportunities of passenger connectivity for the global airline industry” study with the London School of Economics claims that IFC will offer a $30bn revenue opportunity for airlines through ancillary revenue generation.
“Near term, nearly 90% of their revenue will be from selling Wi-Fi access, but we will see this decrease to around 53% by 2035. The new advertising, sponsorship and e-commerce opportunities will build up the difference,” Coiley said.
“But to get the full benefit of ancillary revenues airlines will have to treat passengers as customers. Over time the airlines must demonstrate that they can use passenger data more effectively. Late inventory inflight purchases must be valued and trusted by passengers.
“It will require close passenger relationships and business models.
“Passengers really want connectivity. They see it as crucial, but it must be reliable, consistent and packaged the way they need it. Passengers will pay for a quality service, but business models and processes must be context sensitive and convenient. It is more than just Wi-Fi access,” he concluded.
Coiley said that “Sky High Economics” is just chapter one of Inmarsat’s sponsored study – the next two elements will look at operational savings and efficiencies plus passenger behaviour and loyalty.
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