Hot Topic: What Will Be the Big IFE Issues In 2004?
Before industry pundits pose this question in December, we thought we would beat a few to the punch. Prior to reading further here is a disclaimer: We do not have any inside information or a crystal ball - your "big questions" will probably be different from ours, but we thought our readership might want to start thinking about what next year might bring. So, here goes!
When will someone "Show Us the Money" on the proliferation of in-flight connectivity business models? There we said it! Sunk costs, satellite lease costs, hardware costs all continue to make us uncomfortable about your in-flight surfing future. No question VPN is a requirement for business - who can do it? Is there an alternative to email on over water flights? Ever heard of ASI?
What the heck is going on with wireless in-flight connectivity? Yes we know that PDA's are being looked at by the RTCA and yes, we know the FAA is taking a wait and see posture (we hear they didn't even attend the latest Hamburg TC meeting). Supposedly the B7E7 is cooking up some wireless IFE but that is a rumor and 2008 is a long time to wait. In the US and elsewhere "hot spots" are popping up faster than Starbucks outlets but when do you think we will we see onboard installs fleetwide?
What's the future of in-flight TV? The popular service offering on JetBlue seems to captivate all who use it but how can airline ownership proliferate the product when competitors ask for it? Logically, a sale to an IFE company would seem to be a smart solution but there is no talk on the street about that? With all the promised ground-based bandwidth on the horizon, will there be another supplier in the near term? Over water, Connexion by Boeing has sold this feature to Singapore Airlines but is there hope for new sat-based TV entrants with the high cost of building new "birds"?
As we predicted, the single-aisle market has ballooned. For example, Aloha Airlines is flying B737-700s from Hawaii to the mainland - and we want IFE so we don't have to look out the window. But what are the fallout implications to the IFE vendors? We do know that all IFE suppliers are downsizing their gear, ostensibly for the bizjet market but they are also looking at regionals and, by coincidence, these products may be the "right stuff" for the implementation on single aisle twins….not to mention the retrofit of that same market.
Where is in-seat power going? A few pundits told us battery technology will develop real competition in the decision to power-up or not. Insiders also have said that "DC is dead, AC is the answer" but many will disagree with that position (You know who you are). Will the proliferation of portable VOD players demand more seat juice?
When will that aircraft network fall under the "open system architecture" heading? Admittedly, LINUX is fast becoming the popular solution but software folks tell us that the vendors write the applications and may, for a price, provide licenses to 3rd party vendors. This is probably another quest for ARINC 628?
Lastly, there is a small trend (Alaska Airlines with the rented DigEplayer) that points to the acceptance of pay-for-play IFE. If this is the beginning of IFE-based (or at least cost reduction) revenue streams, it will be interesting to see if airlines who adopt this strategy (at least initially), stick to it when the competition gives it away.
