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Report: In-flight Wi-Fi worth USD30 billion to airlines by 2035
Good quality reliable broadband in the skies is worth about $4 extra for every airline passenger.
While that doesn’t sound a huge amount, collectively it could generate $30 billion for airlines by 2035, according to a study commissioned by satellite communications provider Inmarsat Plc.
That sum will likely come from connectivity access charges, online shopping, advertising and paid-for content like on-demand video streaming.
"We will see innovative deals struck, partnerships formed and business models fundamentally changed," said report author Alexander Grous of the London School of Economics.
The ‘Sky High Economics’ study is the first ever to focus solely on the economic impact of in-flight broadband.
"Globally, if airlines can provide a reliable broadband connection, it will be the catalyst for rolling out more creative advertising, content and e-commerce packages," said Grous.
"Broadband enabled revenue has the potential to shape a whole new market and it’s something airlines need to be planning for now."
Airlines are forecast to bring in about $1 billion in revenue next year from Wi-Fi charges.
Only 53 carriers currently offer broadband connectivity.
The report calls out the ‘variable quality, with patchy coverage, slow speeds and low data limits’ experienced by air travelers at the moment.
However those issues are slowly being addressed by next generation satellite based tech.
By 2035, it is likely that in-flight connectivity will be ubiquitous across the world," the report said.
Asia is expected to be the big growth market and will become a $10 billion industry.
In the US, 80% of domestic airlines have some form of in-flight connectivity, which is far ahead of Europe’s 20%, which has been stymied by overbearing regulatory issues, Inmarsat said.
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Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
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