Panasonic Avionics: “jury’s still out” on profitability of in-flight connectivity
“Prices are falling rapidly, but if you are a service provider like ourselves, you’ve got to position yourself so that you make a penny or two on every megabit you deliver,” he said. “Otherwise, the business is not sustainable. That is the biggest challenge in our marketplace today. Growth: not a problem. Profitability: a real problem.”
“Business is booming but no one is making money,” said Claude Rousseau, research director at Northern Sky Research, adding that inflight connectivity providers have a number of challenges to turning a profit that have yet to be worked out.
“It’s very capital intensive and the take rates are still too low. We see that the price for connectivity hasn’t moved much, except when it’s free, but then if it’s given for free somebody has to pay for it. In the end if it’s not the passenger, it will be the airline or the service provider, and in that latter case the service provider has a hard time recouping the money,” he said."
http://spacenews.com/panasonic-avionics-jurys-still-out-on-profitability-of-in-flight-connectivity/
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