Market Segmentation
As passengers increasingly prefer flights offering smooth Wi-Fi access, growing demand for continuous high-speed onboard internet access is driving the global W-IFE market currently. A new satellite-based onboard connectivity services portfolio, enabling the airlines to provide seamless high-speed internet coverage onboard is under development to address this budding demand. This involves efforts of the key IFC providers, such as Panasonic Avionics Corporation and Inmarsat plc. Airlines are increasingly recognizing the significance of providing connectivity services on-board. According to a survey conducted by Inmarsat in 2017, approximately 83% of the passengers chose an airline that offered in-flight Wi-Fi over an airline that did not. This demand grew stronger in 2018, with the passengers preferring to rebook the airlines offering on-board connectivity, resulting in high profitability for the operators. Also, as per a study carried out by the London School of Economics (LSE), the airlines could generate incremental revenues of around USD 15.9 billion by 2035 by providing paid in-flight broadband access to passengers. Carriers, including Singapore Airlines and Lufthansa, have sophisticated their in-flight offerings, and a few others, such as Emirates, are intending to offer high-speed internet service as a mainstream feature over the coming years. Rising penetration of in-flight broadband is attracting a humongous customer base. It has resulted in a shifting preference of passengers towards accessing IFE services on their devices rather than seat-back systems for entertainment purposes. With the growing demand to stay connected, passengers are getting more inclined towards on-board internet services and are expecting high-speed access during their journey. High-quality broadband service onboard is transforming the overall passenger experience by providing various sources of entertainment and connectivity, such as social media access, live TV streaming, and tele-messaging. Prominent airlines, typically the ones operating on international routes, are increasingly leveraging the benefits of these services as they create a potential for differentiation, customer loyalty, and passenger satisfaction, as well as increase the company’s market share. Growing competition in the airline industry is forcing airline operators to implement W-IFE systems as a differentiating medium to remain competitive in the marketplace.
In-flight entertainment has transformed significantly in recent years, from hard disks and integrated displays into seatback systems to the recent BYOD/PED options supported by IFC. With the growing technological influence and flourishing economies in various geographies across the globe, the sale of IFEC systems is foreseen to upsurge at a gradual scale over the coming years. With a surge in middle-class disposable income, passengers find it easy to spend on hi-tech gadgets and service procurements, the IFEC system services being one of them. In-flight wireless streaming is increasingly being adopted as an option for entertainment onboard, owing to lesser installation cost as well as reduced overall weight of the aircraft. With numerous vendors offering combined Wi-Fi connectivity and wireless streaming, the seat-back systems are expected to get replaced by wireless streaming on the majority of short-haul flights. The emergence of the BYOD trend has encouraged the installation of wireless services, as a result of which, the average W-IFE revenue generated annually is expected to grow significantly over the forecast timeframe. Airlines are differentiating their service offerings based on the vivid categories of IFEC platforms, such as wireless IFE, embedded IFE, and immersive IFE. Based on content delivery, the IFE service portfolio can be distinguished by stored and streamed content service offerings. Recently, an inclination towards the BYOD trend has rendered the surging influence of streaming content services that can be viewed on the personal devices of passengers or airline-provided portable/embedded media interface devices. As per a study conducted by Gogo Inc., Asia Pacific has witnessed a considerable increase in passengers preferring to bring their devices on the plane. According to the study, 93% of passengers in South Korea carry at least one personal electronic device (PED) with them, while in China, the figure stands at around 99%. Smartphones are increasingly becoming the preferred device of the passengers for accessing the content. Owing to the rising demand, carriers are increasingly exploring wireless entertainment options, especially for short-haul flights. This has attracted a huge customer base, ultimately proving profitable for the industry players. Major airlines have commenced to roll out their own BYOD entertainment offerings; for instance, the Canadian airline, WestJet, launched the WestJet Connect Wi-Fi-based wireless IFE system and United Airlines launched the United Private Screening service. United Airlines’ service offering includes exceptional quality content from Vevo and HBO. As per our estimates, the BYOD device portfolio principally includes tablets being brought onboard by over 37% of passengers and used by almost 44% of frequent fliers (flying at least once a month). Major airlines, including British Airways, Emirates, AirAsiaX, American Airlines, Singapore Airlines, and many others are distributing tablets to the cabin and flight crews. Alaska Airlines, which was an early adopter of the BYOD trend in 2011, estimates that it saves approximately 2.4 million pieces of paper while the airline reciprocated that all-digital cockpits will save a minimum of USD 1.2 million a year in fuel costs.
One of the most critical issues encountered by new W-IFE systems is assuring the discretion between passenger data and operational data. This discretion gives rise to two core areas of concern; the first is ensuring that the flight data is handled by a robust system and remains unaffected by a fault in a passenger’s connection. The second concern is that someone connected to the W-Fi onboard might be able to access the aircraft’s operational systems maliciously which might lead to unwelcomed consequences. Recently, a cyber-security firm, IOActive, reported the identification of several flaws in commonly installed in-flight Wi-Fi systems. Also, one of the firm’s consultants managed to break into the aircraft’s satellite communication system using the flight’s Wi-Fi. This ultimately raises the concern regarding the advanced entertainment options being susceptible to critical security susceptibilities. Some security experts have hypothesized that MH370, the Malaysian Airlines flight that disappeared during flight, may have fallen victim to the breach of the aircraft’s security systems. Although it is believed that this was not the case, the possibility highlights the importance of addressing these concerns with a sense of urgency. As a matter of fact, Boeing, whose 777 aircraft series has been highlighted for a possible security fault, has stated that the aerospace industry should be pre-emptive in assuring a secure setup and safe usage of IFEC systems. IOActive indicates the vulnerability that an aircraft’s systems are exposed to. Also, it conveys that in-flight connectivity might be linked to operational systems, which could present safety issues during critical conditions. As per the regulations set by the FAA, any electronic system in an airplane should not compromise the safe operations in any event of failure. The recent regulatory actions are assertive about industry participants meeting higher standards of safety, to ensure safe flights. While it is evident that the current entertainment and connectivity systems pose a noteworthy security threat to aircraft’s safe operations, several positive steps are being undertaken by the companies to ensure the proper insulation of these systems from other electronic devices that are operational on the plane and have access to connectivity. Nonetheless, the W-IFE industry is expected to continue the efforts focused on the security of the aircraft, and are willing to ensure security by addressing all the vulnerabilities.
This section will provide insights into the contents included in this wireless in-flight entertainment market report and help gain clarity on the structure of the report to assist readers in navigating smoothly.
Industry overview
Industry trends
Market drivers and restraints
Market size
Growth prospects
Porter’s analysis
PESTEL analysis
Key market opportunities prioritized
Competitive landscape
Company overview
Financial performance
Product benchmarking
Latest strategic developments
Market size, estimates, and forecast from 2018 to 2030
Market estimates and forecast for product segments up to 2030
Regional market size and forecast for product segments up to 2030
Market estimates and forecast for application segments up to 2030
Regional market size and forecast for application segments up to 2030
Company financial performance