IFC to generate $37bn over next 10 years
September 11, 2018
By Chris Forrester
A report on In Flight Connectivity (IFC) and connectivity from Northern Sky Research says that while the overall benefits of ‘Smarter Planes’ should be worth $37 billion over the next decade, the industry needs to address service quality to users and better measurement of the passenger experience “in what is still an underperforming market”.
This year will be crucial as revenues for IFC are expected to grow by more than 40 per cent. A more digital environment for airlines and communications habits of travellers will set the stage for the market as it meets the demand from passengers and crew alike for a seamless and high-quality in-flight connectivity experience.
“More airlines are deploying IFC with an eye on measuring deeper down the transmission chain to ascertain value of service to passengers with a set of very refined and key performance indicators,” stated Claude Rousseau, NSR Research Director and report author. “Furthermore, IFC is becoming an enabler for what is often identified as the smart plane but in reality, is a more holistic approach to connectivity across fleets for different types of service for various classes of end-users.”
NSR forecasts $3.8 billion in annual retail revenues will be generated from commercial passenger markets by the end of the next decade. To get there, airlines will play a central role in the development of the market; however, with more than 200 airlines that could offer connectivity on their flights, the ramp-up is significant.
However, with service providers struggling to find the right balance between services and profits, the need for more consolidation in a market too crowded today is more evident than ever. Install rates are also lagging while the industry searches for the right business model. Additionally, a gap still exists to catch up with issues ranging from quality, speed, affordability, ease of connection across fleets for both passengers and crew, Wi-Fi pricing strategies all the way to providing more IFC in loyalty programmes.