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The Connected Aircraft (Part III) – Smooth Operator – Secure, Sustainable, Connected

Dec

14

2016

by Panasonic Avionics / in Technology

THE CONNECTED AIRCRAFT – PART III

Smooth Operator – Secure, Sustainable, Connected

Ground-Operations-thumbThe benefits of The Connected Aircraft may be difficult to grasp on the ground, until you understand how they simplify everyday problems and open up unimagined opportunities.

Then the next step is simple: find the right partner to help you take off.

A Resilient Future

At its annual general meeting in Dublin, International Air Transport Association (IATA) director general and CEO Tony Tyler celebrated the steps the industry has been taking toward making the industry more resilient for the future.

“This year we expect a collective net profit of $39.4 billion,” Tyler told airline CEOs and industry leaders gathered in Dublin last June. “Lower oil prices are certainly helping, though tempered by hedging and exchange rates. And your hard work is strengthening the business. Load factors are at record levels. New value streams are increasing ancillary revenues. And joint ventures and other forms of cooperation are improving efficiency and increasing consumer choice while fostering robust competition.”

He suggested that this progress is reinforced by what he called the four foundation pillars of healthy operations: safety, security, global standards, and sustainability.

“The first three pillars focus on improving technology, operations and infrastructure. As a result, emissions are growing more slowly than the kilometers we fly, and we are on track to meet our fuel efficiency target,” Tyler said.

Ensuring the right technology is in place to support operations and infrastructure is the best way to satisfy IATA’s fourth pillar of sustainability.

IATA has identified connected aircraft as one of the technology upgrades the airline industry needs to meet its targets.

By reviewing each of the pillars of progress, Tyler spoke about at AGM, it’s easy to understand why.

Safer Flights

IATA estimates that a single flight diversion can cost an airline as much as $200,000.

Fortunately, airlines and avionics companies are getting better at identifying how to decrease the number of weather and health-related diversions — and connected aircraft are a huge part of the solution. For example, live weather visibility on connected aircraft improves safety by helping pilots avoid dangerous turbulence which can lead to passenger and crew injuries.

Elsewhere, live aircraft health reports on connected aircraft give ground operations a better view of component performance. Reports can help identify parts which need replacement before the aircraft lands, avoiding aircraft-on-ground incidents that can cost airlines as much as $150,000 per hour. But beyond these savings, live insights on the performance of critical parts — like engines — can help airlines identify problems which could become safety issues.

Connected cabin crew are empowered to offer customers better service, including alternative plans when there are flight changes and updates on the status of their bags. These are high priorities for passengers, and satisfying those needs increases satisfaction and loyalty.

Connected cabin crew can also better handle inflight medical emergencies, avoiding diversion costs by connecting directly to medical support on the ground. Through secure backchannels, connected crew can also report to the ground if any issues threaten the safety and security of the flight.

Connected cabin crew are empowered to offer customers better service, including alternative plans when there are flight changes and updates on the status of their bags.

More Secure Flights

Beyond better communications with pilots and cabin crew, connected aircraft meet International Civil Aviation Organization (ICAO)’s requirements for advanced flight tracking, for both regular and irregular operations. Panasonic’s eXConnect lets airlines track their aircraft via satellite in real-time from the ground, and the systems allow controllers to view the aircraft’s progress on its intended flight plan.

ICAO recommends a minimum of a 15-minute check frequency during normal operations. Airlines using eXConnect can increase that frequency to every five minutes from the ground, if it were so required. Connected aircraft are also ready to meet future security requirements, such as electronic black boxes, currently still under review.

By connecting aircraft today, airlines can prepare for the regulatory landscape of tomorrow.

Global Standards

Panasonic doesn’t influence global regulations and requirements, but it can help airlines maintain a competitive edge which stands up to the challenges of a global marketplace.

Modern, connected aircraft create a level playing field. They give carriers equal visibility of their operations around the world, and the tools to offer customers from connecting alliance partners seamless brand experiences.

Because each airline is free to tailor services to their particular brand strategy, connected aircraft also give airlines room to get creative and differentiate their onboard experience, surprising, delighting and creating loyal customers.

Sustainability

Connected aircraft can help airlines meet the industry’s environmental sustainability targets by avoiding disruptions and diversions while finding more efficient flight paths.

This saves airlines time and fuel. Connected aircraft also support the next generation of air-traffic management infrastructures, which will make flight paths even more efficient.

IATA estimates that improved air traffic management in Europe will save €245 billion (US$273 billion) in future costs.

The Federal Aviation Administration (FAA) estimates that U.S. NextGen infrastructure will save airlines over $50 billion. That’s $37 billion in crew and maintenance savings, $14.3 billion in fuel and $400 million in reduced CO2 emissions. After all, fuel is cheap now, but there’s no guarantee it will remain so. Other global economic and geopolitical factors in play now, or in the future, also make creating new revenue opportunities imperative to maintaining a healthy bottom line in the long term.

Connected aircraft reduce costs by facilitating more robust operations. They also create a host of revenue opportunities.

Making Wi-Fi Pay for Itself

As Scott Scheer, Director of eXTV and Ancillary Services at Panasonic Avionics explains, there are many revenue opportunities in connectivity beyond selling Wi-Fi to passengers onboard.

Unlike some Wi-Fi services in the skies today, the retailing of Panasonic’s eXConnect Wi-Fi services can be fully tailored to the airline’s brand strategy.

“It really depends on the airline’s fundamental goal. If they’re looking at connectivity as just an ancillary sale, then they need to find the pricing point that matches the market and gives them that commission,” Scheer says. “If their motivation is Wi-Fi as an amenity, as part of their overall brand, then offering a low price or even free — depending on what it means to the broader business case, or the strategic passenger experience position — could make sense.”

One reason airlines might offer discounts is that the service could boost bookings. “The amenity could result in more people choosing to fly the airline in the first place, which is probably the most valuable thing an airline can get,” Scheer points out.

A study by OAG found that 50 percent of all passengers and 60 percent of millennial passengers would pay for Wi-Fi onboard. In fact 64 percent of millennials would pay for high-performance Wi-Fi, so there is room in the market to use Wi-Fi as an à la carte ancillary booster.

But charging for Wi-Fi service across the board is not the only way to boost revenue. The service can be free to high-revenue, premium-fare flyers, or to frequent flyer customers. Airlines could also give customers the option to pay for Wi-Fi with loyalty miles.

Customers can even be offered access to Wi-Fi in exchange for completing surveys that give airlines or their sponsor partners useful consumer data.

With Panasonic’s OneMedia end-to-end advertising platform, airlines can find new revenue channels and monetize the service. For example, revenue builders can integrate the Wi-Fi offering to the airline’s booking process, adding Wi-Fi passes to other ancillary products sold with the ticket.

Panasonic doesn’t get in the way of airlines making these critical decisions. In fact, it sees itself as a facilitator.

“For us, our strategy has been to structure our commercial terms with airlines so that they have the flexibility to make those types of decisions in how they interact with us,” Scheer says. “We can offer them a solution where they can get the most cost-effective and lowest price per megabyte, then we give them the ultimate flexibility in how they choose to use that connectivity service. In other cases, they can take a lower-risk approach, if they’re more interested in the direct ancillary choices, and treat it as a retail service where Panasonic carries some of that risk.”

One reason airlines might offer discounts is that the service could boost bookings. “The amenity could result in more people choosing to fly the airline in the first place, which is probably the most valuable thing an airline can get,” Scheer points out.

The Right Partners, The Right Support

Panasonic’s customer support offers passengers 24/7/365 multi-language support to address any issues by phone, email or live chat. Panasonic’s web-based tool helps airlines quickly update their connectivity portals, without requiring an acceptance test plan (ATP).

The Right Connections Matter

Aviation is inherently about making the right connections.

Connected aircraft are only one layer of the many improvements ahead for aviation’s next 100 years, but those connections on planes form the foundation to enable many other improvements.

As Tony Tyler said to IATA AGM attendees, “People are thirsty for the opportunities that aviation makes possible. Every day we safely transport 10 million people and 140,000 tonnes of cargo. We are not just connecting people and shifting goods; our work is building a better future for the peoples of the world. Aviation’s potential has never been more inspiring.”

We would have to agree.

For more information visit The Connected Aircraft