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KEYNOTE: PIERRE JEANNIOT
“IFE has become the most expensive item on an aircraft, just after the engines,” said Pierre J. Jeanniot (Chairman, THALES Canada Inc.) during his keynote address Monday morning.
“So, it had better do a helluva job of differentiating the high-end product and generating revenues in the low end,” Jeanniot said.
After many years of virtually stagnant cabin innovation, “carriers have recently begun to pour millions of dollars into improving their cabin product, elevating first and business class to new heights, while reducing the back end of the airplane to a flying merchandise mart,” Jeanniot said.
“IFE and the entire cabin environment have become a driving force of airline business success.”
Although it is difficult to quantify an exact return on investment, Jeanniot said: “Investing in a premium service is simply mandatory for any carrier committed to remain a credible player in that market segment.”
Carry-On Compatible, Plug-and-Play
Some airlines are installing equipment to work with passengers' own portable devices to offer individualized information and entertainment.
“This combination of personal electronic devices working in concert with an airline-provided broadband delivery system is a likely model of IFE in the future,” Jeanniot said.
It is highly unlikely that any recently installed IFE systems would be made redundant in the near future by carry-on devices, he added.
Many new systems are being engineered to address the evolving market. Modular architecture allows new technologies and equipment to be introduced on a plug-and-play basis, and processing power and data storage capacity can be upgraded as evolving technology permits.
Generating Revenue, Meeting Pax Needs
The more sophisticated interactive IFE systems will accommodate new forms of service and advertising.
“Monetizing the cabin” through IFE has become a hot topic.
This provides IFE suppliers an opportunity to work with airlines in designing a unique product to differentiate the airline, meet their passengers' needs and expectations, and “develop new applications that airline customers never knew they needed.”
EXEC PANEL DEBATES ‘HOT TOPICS'
Tuesday Morning's ‘Hot Topics' session generated pointed discussion as a panel of IFE executives tackled the tough questions facing the industry. Here are some highlights of the Q&A.
Key IFE innovations for the future?
• The future is here. There will be “connected airplanes” in 4-5 months, letting passengers use their portables inflight and letting the airline provide destination-specific content.
• Providing more diverse and better service to the airline from one company.
• Content delivered to the plane from off-sight, eliminating the need to physically load content.
• Simplified system for providing content across all the various different platforms.
IFE as a commodity?
• Every airline has a unique identity, and IFE lets airlines clearly differentiate and distinctly brand.
• Airlines want to provide a custom image and keep IFE out of “commodization.”
• Studios are using synergy among all elements of their products to add more value with their content.
• Software aspects and added functionality can differentiate hardware systems.
• Standardization is important from the airframers' perspective. Systems can still be customized with interchangeable interfaces offering IFE options.
Impact of the US DOT's Proposed Rule mandating IFE ‘closed captioning' (CC)?
• CC and subtitling on demand are viable and will be offerable within the next few months.
• Hardware manufacturers have test-proven systems that can provide CC.
• At least three viable standards for CC exist, and the IFE industry should use one standard.
• English-only captions would not be adequate for our industry.
• CC can be sourced from other parts of the entertainment industry.
• If CC is not being generated by the studio, there will be an additional cost to create it.
• Potentially, subtitles could suffice for CC, which would be faster and cheaper.
Security of content and passenger info in a connected and wireless cabin?
• 75% of business travelers use Wi-Fi in public locations, and inflight connectivity providers have made their systems more secure than on-the-ground public access points.
• VPN connections are very secure via a complex, hacker-proof solution.
• Early Window content is an issue. Handheld AVOD devices have been tested vigorously by the studios providing content.
• Studios are waiting for hardware providers to provide specifications for hardware systems, so they can test the latest systems.
• On long-haul flights some passengers try to hack into or break-down the IFE system.
• The IFE system is always kept separate from the cockpit operational systems.
• Don't over-spend on excessive security.
• Encryption, firewalls, and security codes are used to prevent inappropriate use of or access to content.
Wireless devices and a wireless cabin?
• Wireless capability has value on the aircraft, but it is not the answer to all needs.
• People want to use on a plane what they use on the ground.
• A wireless IFE cabin does not save weight over a wired cabin.
How can airlines differentiate if they all offer broadband connectivity?
• Some airlines will use connectivity to give passengers more freedom and control. Others will also use it to provide destination-specific information by flight or to provide flight attendants information about the passengers to personalize the passenger's experience.
• Airlines can also use connectivity for revenue-generation. SESSION: A380 IFE LAUNCH
The A380 is an aircraft that was developed when the industry had been through “a painful 10 years,” said Patrick Brannelly (Emirates). There had been problems with IFE reliability and weight, but “faith has been restored in IFE systems, and airlines are making huge expenditures as a result,” he said.
Representatives from all areas of the airline industry “worked together to assess what needed to be done to make the future brighter. We painted the future and made it happen,” Brannelly added.
Andy Schweiger (Airbus) described some of the newest systems and features to debut on the Airbus 380, stressing the need to “test, test, then test it again.”
“A revolution is taking place,” said Neil James (Panasonic Avionics Corporation). “The industry is moving from what the system is to what it does !”
IFE must do more to keep 660 passengers entertained, James said. In addition to films, audio, games, and moving maps, IFE systems should provide inflight hospitality and shopping and be used as a business tool to capture data and interact with passengers.
SESSION: PAX RESEARCH
“People do not consume on-screen information the same way they do hardcopy, so you cannot publish hardcopy material onto the small screen with the same result,” Robin Brown of Synovate said.
Synovate measured pax-IFE habits in 10 Asia Pacific markets, where business and leisure travel is expected to grow with the expansion of budget airlines.
Synovate's research found that inflight magazines appeal to all age groups of high-income, highly educated passengers. These results provide marketers and advertisers with a more accurate measure of the power of inflight magazine and entertainment exposure.
Testing Pax Response to IFE System Design
Adam Smith (Flight Level Media, Ltd.) said: “There's always one person who is not represented in the IFE design process—the person who will use the system.”
There are three methods for “digging deeper” into pax response — user interviews, creating “personas,” and usability testing.
Smith said significant data can be gathered from a sampling of five-to-eight people. Patterns begin to emerge, and researchers can create “personas” for each distinct type of respondent to understand the impact of changes and look for new feature opportunities.
Usability tests can start with paper prototypes or a basic mock-up of the IFE interface to identify the basic flow of the concept and pax understanding of terminology.
Designers should test early in the design process, again in the middle of the process, and at the end.
SESSION: IFE DIRECT REVENUE
Barbara Hollenbeck (Northwest Airlines), Christine Ringger (Swiss International Air Lines), Somphol Chaiyakiat (Thai Airways International), Louise McKenven (Air Canada), and Garry Edmonson (WestJet Airlines) revealed how their airlines use IFE for direct marketing. Here are some of the key points made:
• Inflight magazines are an integral part of the airline brand and, with ad sales, its weight is worth the fuel cost.
• Advertising has evolved into a cross-promotional opportunity within the cabin and via the website, including ancillary products, product testing, and product placement.
• Airlines must walk the thin line between enough advertising and too much. There is a risk of overwhelming the airline brand.
• Regionalizing advertising via AVOD systems is possible and will expand as systems develop.
• The long lead time for AVOD can make ad placement difficult.
• AVOD lets airlines track pax usage and provide better numbers to advertisers.
• AVOD has expanded the opportunity for sponsored content and channels.
• When an ad for a beer ran prior to the beginning of the inflight film and just as meal service began on Thai, beer sales increased. The beer company has extended its ad contract.
SESSION: CABIN CONNECTIVITY
Aeronautic usage of satellite communication “will hardly bear the infrastructure cost of global satellite coverage on its own,” according to Michael Stobinski (QEST). A high-performance antenna is a key factor in the overall system, and airlines should be willing to “spend a little more.”
John Guidon (Row 44) concurred: “The better your antenna, the better your data.”
Hardware is a one-time investment, which the airline should plan to keep for a minimum of 10 years. “It might get better with applications, and IP innovations will spawn new applications, but the hardware will not evolve much,” Guidon said.
Tom Weigman (AirCell) stressed that connectivity is new to airlines, but not to consumers, who view it as a must-have capability. “The Web is at the core of everything,” he said. “The time for connectivity is here and will get bigger, better, and more inclusive.”
Justin Barocas (Anomaly) emphasized using connectivity to enhance the branding experience—integrating the pax on-aircraft experience with their on-the-ground experience.
Connectivity can provide a seamless entertainment experience for the passenger, who can listen or view IFE , customize a playlist, rate his experience, and buy a CD or film he enjoyed.
David Gaspar (Wi-SKY™) called the airline “a new broadcast market.” Passengers want to have a home-to-home experience, able to stay connected with their families, work, or enjoy their own entertainment inflight … without disruption.
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