What type of usage rates do streaming video solutions generate on board aircraft? Why do some airlines choose to offer wireless IFE together with Apple iPads and other tablets? Should newer IFE firms fear industry stalwarts sweeping in and snatching up their trial airlines? What might Boeing’s MOU with Samsung mean for the industry? These and other questions were addressed – quite frankly I might add – during APEX’s first conference in South America, an education committee meeting held in November in Santiago. I had the pleasure of moderating the ‘wireless IFE and portables’ panel comprising executives from Gogo, Lufthansa Systems, Bluebox Avionics, digEcor, Thales, Rockwell Collins and OnAir. The following discussion represents Part 1 of a two-part series recounting our shared discovery in Chile.
Mary Kirby: Gogo, among all the panellists you have the most experience with wireless IFE with your Gogo Vision offering. Candidly, I monitor Gogo’s Twitter stream regularly, and I don’t see a whole lot of people talking about Gogo Vision. What has passenger take-up been like?
Gogo senior VP and CTO Anand Chari: We are essentially rolling out the product. It’s gaining momentum every day as we speak. So, we started with a few aircraft, now up to a few hundred and going to about 1,600 very shortly. The feedback has been very positive but it’s still in the early stages of being rolled out, so I don’t have any exact figures on passenger take-up that I can share with you right now but the feedback from the airlines and the passengers have been positive [underscored by the fact that it is being extended] to eight times more aircraft than it is available on today.
Mary Kirby: Hollywood studios are reticent to permit the streaming of early window movie content to passengers’ own devices, even with security protocols in place. But does all content offered on Gogo Vision require digital rights management (DRM)?
Gogo senior VP and CTO Anand Chari: There is content in our portfolio that does not require DRM, but most of the movies and TV shows and such do require DRM. Every Gogo Vision aircraft today also has some sort of [inflight] connectivity, and mostly it’s ATG or ATG-4 so we use the connectivity for doing the DRM transaction and payment transaction.
Mary Kirby: That’s where you guys seem to have a bit of a leg up on some competitors, because the passenger is able to download the appropriate app on board the aircraft via the inflight connectivity [over your air-to-ground network in the United States] versus having to do it pre-flight. Is that right?
Gogo senior VP and CTO Anand Chari: That is correct. The app or plug-in itself could be loaded onto the onboard server, but you certainly need connectivity for DRM key management and payment processing. Connectivity also helps in updating the product catalogue and updating the portal – the face you put on the product and in front of the passenger. So it helps quite a bit, and I think you are correct in saying that provides us an edge over others.
Mary Kirby: Delta recently announced at the APEX EXPO that it is going big with Gogo Vision. And of course Delta also offers embedded IFE on a lot of its aircraft. Do you think this as an experiment to see what people really want – embedded versus wireless? Or do you see it as one augmenting the other? How can a wireless IFE solution that does not allow early window movie content to be streamed to passengers’ own devices compete with an embedded IFE system?
Gogo senior VP and CTO Anand Chari: On those aircraft that have both the wired and wireless it’s really complementary. I don’t think it’s necessarily competing, or one has to win over the other.
Mary Kirby: After Gogo, the next company with the most real-world experience is Lufthansa Systems. Lufthansa Systems has been trialling its BoardConnect wireless IFE system on various airlines. Michael Childers, can you tell us about the data gleaned from the BoardConnect trials?
Lufthansa Systems chief consultant, content and media strategy Michael Childers: I can share some numbers with you from one of the larger trials. We had a trial in the spring and into the summer that lasted about five months. The airline was providing iPads in every seat. There were a little over 250 iPads. We had five wireless access points (WAP) on the aircraft so we had a wireless access point for about every 50 passengers. During the course of that trial there were 14,706 users. The average total number of clients per flight was 118, which represented about 46% of the cabin. The average number of videos [streamed] per flight was 466. The average number of played audio tracks per flight was 195. I guess these weren’t music lovers. And the maximum number of simultaneous clients was 187 so that meant that 74.7% of the users were engaged simultaneously at one time. There is anecdotal evidence to the effect that within any given WAP, we reached very close to the maximum of 50 passengers on a number of occasions; I can’t tell you quite how many. The passenger reaction and the airline reaction was very positive. The surveys were skewed a little bit by the fact that in this trial, the headsets and the iPads were not the best match, and so there were passengers that said ‘we don’t hear real well’, which for those of us who have been in the handheld IFE space, we’ve all heard that.
Mary Kirby: That’s very interesting actually. So something as simple as audio impacted the experience?
Lufthansa Systems chief consultant, content and media strategy Michael Childers: Even with a fair amount of audio complaints, we still had two thirds of the reaction in the good to excellent range but it was skewed a little bit because of the audio.
Mary Kirby: So for all intents and purposes a successful trial?
Lufthansa Systems chief consultant, content and media strategy Michael Childers: We considered it very successful. In fact all of the airlines we’ve trialled with have considered them successful, and this one was considered quite successful.
Mary Kirby: So, editor’s note, and I know that Michael Childers is not at liberty to discuss names and whatnot, but Qantas trialled the BoardConnect solution from Lufthansa Systems. Qantas ultimately decided to pick Panasonic Avionics’ wireless IFE solution eXW [we’ll talk to Panasonic in Part 2]. My question to Michael is this: can you tell me, generally, if newer companies should be concerned about a big gorilla marching into the room and snatching up their would-be customers?
Lufthansa Systems chief consultant, content and media strategy Michael Childers: I think that probably is a valid concern. The airline did not choose to share with us their reasons for making the other selection so we really don’t know. All we know is that in the process of telling us this, they told us how happy they were with the trial, but we said, ‘thank you very much, compliments are great, a cheque would be better’. But yes there are always those issues of … how deep are pockets and what impact that has on the marketplace.
Mary Kirby: So really, what does that say about what’s going on in the market right now? Are there a number of providers out there in the wireless IFE, tablet space and of course the embedded and inflight connectivity space, giving the kit away for free with the promise of sharing revenue with airlines down the road? Is this widespread? And really, anyone can answer this one. Is this what’s going on?
Mary Kirby: Michael?
Lufthansa Systems chief consultant, content and media strategy Michael Childers: I can’t say that I know that definitely that is it the case because I don’t engage with the sales people on any sort of a regular basis so I don’t know exactly what’s being experienced in the field. I do know that we are a German company. We are conservative. And It may very well be that others see some of the financial situations differently.
Mary Kirby: One of the things I found interesting about the Qantas trial was that it included both airline-provided tablets (iPads) and wireless IFE. And I could not wrap my head around why you need a tablet and wireless IFE [in this instance]. If you’ve got the tablet and it’s got studio approval for early window content then you’ve got everything you need right on the tablet. What is the point of then streaming the content to a tablet that could be just pre-loaded? And that question is for Bluebox’s David Brown, please, since you’re doing the tablets with Jetstar and so many other airlines now.
Bluebox Avionics joint managing director David Brown: I think the tablets have been a great success. The biggest problem we’ve had with all our customers … is running out of them. Practically speaking, in any aircraft you just can’t carry an aircraft full of tablets. Therefore we see it as a naturally complementary solution to have wireless IFE on top of tablets [to provide greater access]. You simply can’t carry enough airline-issued tablets.
Mary Kirby: So iPad-based portables are popular even though people have their own devices? It seems inexplicable. What is the reason?
Bluebox Avionics joint managing director David Brown: I think, despite what you think, Mary, we are more privileged users and we have more tablets than the majority of people travelling. I walk up and down the aisles of aircraft regularly just to have a look at it and see a percentage and it’s still pretty low. I think another thing is … spending the time to download the content is not particularly high on my [or passengers’] priority list.
Mary Kirby: Rockwell Collins principal marketing manager Jerry Thomas and I were actually talking about this yesterday, at the drinks session. Who has the time to download all of the content? I know I arrive at an aircraft with an iPhone that has a tiny bit of juice, and scramble to find a plug at the airport or on board the aircraft. Ben Fuller of digEcor, do you agree with David Brown about tablets and wireless going hand-in-hand?
DigEcor director of sales (Latin America) and marketing Ben Fuller: Yes, absolutely I think they’re complementary to each other. We found that people also stick with their brand as well. The fight between Apple and Samsung right now is huge. So, for instance, I won’t touch an iPad just because I’m a Seattle guy and a Microsoft guy and we offer the Samsung Galaxy Tab [at digEcor]. We did a passenger survey this summer and found that less than 20 per cent of people actually took their tablets on the plane and used them on the plane.
Mary Kirby: What do you make of Boeing’s announcement that it signed an MOU with Samsung? What does that mean for all of you down the road if Boeing can do a more plug-and-play scenario with Samsung and get rid of the whole lot of you?
DigEcor director of sales (Latin America) and marketing Ben Fuller: Samsung is an interesting creature. One of the issues we’re dealing with at digEcor right now is there has been a large uptake in brand image whether they [airlines] want a Samsung or Apple device. Because of what’s going on at Samsung [in terms of legal proceedings], we’re also looking at the option of an additional purpose-built device. We found from a lot of people who have gone straight to Samsung or Apple that their off-the-shelf solutions are not tailor-made for an airline. There is a lot of work that has to be done [for airlines] from a service standpoint, a functional standpoint, and a rugged durability standpoint, and straight off-the-shelf solutions haven’t been working for a lot of airlines. Let me give you an example. For one of our customers, in order to turn off the device and recharge it, you have to hit the power button twice. You hit the power button, and then it asks you if you really want to turn it off, but the airline’s stewardesses just hit the button once, and then put it on the shelf. When they went back and grabbed the devices the battery would be completely depleted. So Samsung is doing their thing but because of some of that, we’re taking a different approach. We can put out a device that is on par with Samsung or iPad although we also offer some of the devices that are more purpose-built for the industry, if you will.
Mary Kirby: This is the first South American conference for the APEX education committee. So, Chris from Thales, I’d like you to explain your trial programme with LAN. What does the retrofit entail, and when do you expect roll-out?
Thales senior manager, media services Chris Allirot: We’re working on rolling out our first Airbus solution on a LAN A320. Right now we’re pretty far along with our testing. We’ve pretty much validated our solution and we expect to roll out in early 2013. With our solution we tried to serve at least 100 passengers concurrently streaming; that’s really our target. We do a solution based on HLS, which is HTTP live stream, which is really adaptive streaming. We try to tailor to multiple types of devices … there will be multiple resolutions. So depending on the device you have, when you’re streaming, the resolution will be tailored to that device. And because it’s adaptive streaming with different resolutions, the maximum number of passengers served will vary on those parameters.
Mary Kirby: At the recent APEX technical committee meeting in Los Angeles, virtually all the providers here said they could support 50 passengers simultaneously streaming videos per WAP. You plan to support fewer. Why?
Thales senior manager, media services Chris Allirot: Our packaged solution is one server and three WAPs. With a single server and three WAPs you can serve 100 passengers. Once again that number is not fixed. We want to guarantee the best experience for our passengers so it’s an average if you like.
Mary Kirby: In tandem with the LAN trial, Thales is also trialling GateSync at the same time. Tell us about that and where do studios stand with respect to their comfort level about GateSync?
Thales senior manager, media services Chris Allirot: GateSync is essentially an airport wireless transfer mechanism so there is a base station at the airport, an antenna, and an antenna on the aircraft where we can wirelessly transfer content to the server on the aircraft. We’re using this solution to update content fast; it’s usually meant for small pieces, mostly RSS feeds for news, for example. As far as studios are concerned, GateSync provides encryption during the transfer; we’re also using DRM in key management. So you could transfer one path over GateSync, and the second transfer via keys.
Mary Kirby: SITA/Airbus joint venture OnAir – you’re an inflight connectivity provider; what are you doing on this panel? Are you now offering wireless IFE as well?
OnAir head of Latin America Mohssine Lahlou: One of the market segments we’ve identified [for wireless IFE] is what we call the low-cost airlines. Particularly as the low-cost [segment] starts to operate long-haul flights, they are not interested in carrying full-fledged embedded IFE. But they are looking for IFE and connectivity at the same time. Their [interest in] offering both at the same time is financially driven; they want to offer something but at the same time not offer it free-of-charge. So they want it to be part of a single solution. So this is how we came into this market. We’re also seeing another market segment, the narrowbody fleet, where the majority of aircraft are not equipped with embedded IFE. Those airlines have absolutely no plan to equip with embedded IFE. This is how we came into this market. We started about two years ago. We did not make a major announcement because we didn’t want to confuse the market because our core product is connectivity. Wireless IFE is part of the [content] apps. So, we want to have a catalogue of applications where a customer comes to OnAir, wants this application or that application and that will be offered to the airline. We have run tests. We have customers that are not announced.
Mary Kirby: Are they new customers?
OnAir head of Latin America Mohssine Lahlou: They are new customers but none of them have been announced yet. The solution has already been tested; we have been fairly quiet about it, for simple reasons … installation [is planned] for 2013.
Mary Kirby: Is your wireless IFE solution operated over the Airbus ALNA connectivity platform?
OnAir head of Latin America Mohssine Lahlou: It’s a new generation system, not ALNA, although I have to mention that ALNA with wireless IFE is something we’re interested in doing with existing customers and Airbus is working on something, but the current solution that can do both [connectivity and wireless IFE] is a new generation system. And it will be independent of aircraft types [i.e. not just Airbus aircraft]. Though currently it is only offered on a retrofit basis.
Mary Kirby: Would you ever consider going back to Ryanair and offering wireless IFE since the carrier has got your connectivity kit on board 50 aircraft?
OnAir head of Latin America Mohssine Lahlou: Absolutely. If you can present the right business model…