Singapore Airshow: The fight for eyeballs in mid-air

A photo of an Emirates A380 aircraft showing screen on seats for in-flight entertainment Offering good in-flight entertainment has become a key priority especially for premium airlines

As we sat down to plan a recent trip that involved taking a flight halfway across the world, I asked my wife if we should fly with a relatively cheaper airline and spend the extra cash on shopping.

After all, we were heading to the US - the land of outlet malls and holiday season sales.

Surprisingly, her answer was a firm no, followed by: "It's close to 20 hours in a plane. I need to be entertained and I am not flying with an airline that doesn't offer good options."

And she is not the only one who looks at that factor when deciding which airline to fly with, especially on a long-haul flight.

"In-flight entertainment is right up there in the priority list of travellers," says Shashank Nigam, chief executive of Simpliflying, a firm that advises airlines on customer engagement.

"When people know they are going to be sitting on the same seat for hours at a stretch, this could be the factor that tilts the balance against, or in favour of, an airline."

Growing competition

Start Quote

Free on-board internet connectivity in all classes of travel is the next level of in-flight entertainment”

End Quote Shashank Nigam Simpliflying

Airlines, especially premium carriers, have realised this and are spending hundreds of millions of dollars trying to offer better in-flight entertainment than their rivals.

In July, Singapore Airlines announced a $400m (£243m) deal to equip its new planes with, what it calls, the "world's most advanced in-flight entertainment system to date".

Its new Boeing 777-300ER, Airbus A350 and Airbus A330-300 planes will have touchscreen handsets in all classes and larger screens.

The A350s will also offer broadband internet, mobile phone services, and live TV.

Singapore Airlines is not the only carrier improving its offerings.

Gulf-based Emirates offers Live TV on select Boeing 777 flights flying over the Middle East, Europe, Africa, parts of Asia and North America.

A projector being fit in a United Airlines plane to show in-flight movies In-flight entertainment has come a long way since the early days when projectors were used to beam movies on a single screen in the centre of a plane

Australian carrier Qantas offers an iPad pre-loaded with 200 hours of entertainment content to passengers travelling on selected refurbished Boeing 767 aircraft.

In December 2012, British Airways became the first UK airline to allow customers on long-haul flights to enjoy in-flight entertainment from the moment they are seated, instead of having to wait until take-off.

"Offering the very best in-flight entertainment is a priority for us," a spokesman for BA told the BBC.

Enhancing its in-flight entertainment services is part of the airline's continuing five-year £5bn investment programme to strengthen the overall offering for customers.

Growth opportunities

With more than 11,000 planes expected to be sold over the next two decades in Asia-Pacific, demand for such systems is only likely to grow further.

Various companies, including Thales - the world's second-largest maker of such systems - are looking to woo customers at the Singapore Airshow, taking place this week.

New in-flight entertainment systems by Thales on display at the Singapore Airshow Thales is demonstrating its latest in-flight entertainment solutions at the Singapore Airshow

"It is the most exciting time for firms making in-flight entertainment solutions," a Thales spokesman told the BBC.

"The demand for airplanes is growing and our industry will grow in tandem."

The firm - which also makes other aerospace products - generated overall revenues of $14.2bn (£8.6bn) in 2012, with in-flight entertainment systems being a key contributor.

According to Thales, the in-flight entertainment system is the second most costly component of a plane after the engine.

Firms are also vying to improve the quality of the systems.

"We are getting closer to offering a similar experience to what passengers would get in their living rooms," Thales said.

'The next level'

The race to attract customers is likely to heat up further as airlines look to offer wireless internet connectivity across the board.

Start Quote

Passengers can experience internet connections similar to what they would in a downtown Starbucks or McDonald's”

End Quote Carl Esposito Honeywell Aerospace

Many carriers do offer this service currently, but the take-up rate among customers has not been that high. In some cases it is too costly for passengers to sign up, while sometimes the connectivity has not been that great.

But with a recent surge in the number of people using devices such as smartphones and tablets, it is a service that airlines cannot afford to ignore.

"Free on-board internet connectivity in all classes of travel is the next level of in-flight entertainment," says Mr Nigam of Simpliflying.

"Airlines can't play the wait-and-watch game on this front anymore."

Mr Nigam explains that on-board connectivity will provide carriers with an opportunity to offer more value-added services and even open up new revenue streams.

"An airline can profile its customers very well and that data is invaluable to companies looking to target a particular segment of clientele," he says.

"You can sell advertising space depending on the routes you are flying, the class of travel and even partner with hotel firms to offer deals on-board."

Honeywell Ka-band Fuselage Mount Antenna Honeywell's solutions for on-board internet connectivity are on show in Singapore

Companies specialising in the field are sensing an opportunity.

Honeywell Aerospace is displaying its latest technology at the Singapore Airshow which, it claims, will make in-flight connectivity 30 to 40 times faster than current levels, and also bring down costs.

"Passengers can experience internet connections similar to what they would in a downtown Starbucks or McDonald's," says Carl Esposito from Honeywell.

The firm says it is already in talks with various airlines to install the technology and has forecast revenues of nearly $2.8bn over the next 20 years for the product.

More on This Story

The BBC is not responsible for the content of external Internet sites

More Business stories

RSS

BBC Business Live

  1.  
    GSK FINED $492M 09:33:

    Mark Reilly, the former head of GSK in China, and other so far un-named GSK executives are also expected to face prison sentences of between two to four years, according to the Chinese Xinhua press agency. GSK has yet to release a statement. We'll bring it to you as soon as the company does.

     
  2.  
    GSK FINED $492M 09:30: Breaking News
    A flag bearing the logo of GlaxoSmithKline flutters next to a Chinese national flag outside a GSK office in  Shanghai

    Pharmaceutical giant GlaxosmithKline (GSK) has been fined $492m (£297m) by Chinese authorities in relation to bribery allegations brought against the company earlier this year. Changsha Intermediate People's Court in Hunan Province, found GSK executives guilty of "offering money or property in order to obtain improper commercial gains" and has found the company guilty of bribing non-government personnel.

     
  3.  
    BUSINESS REACTION 09:15: World Service

    Patrick MacDonald a Scottish entrepreneur, says that small and large businesses "quietly confessed" to him that they have not been sleeping at night. On Business Daily he claims that some were even prepared to make redundancies this morning, in the event on a "Yes" vote.

     
  4.  
    Via Twitter Douglas Fraser Business and economy editor, Scotland

    tweets: "Scotch Whisky Assoc welcomes stability: "debate has shown need for govt + business to collaborate to address long-term economic challenges""

     
  5.  
    BUSINESS REACTION 09:04: World Service

    Lord Haskins, former chairman of Northern Foods, thinks there could be "consequences" for the supermarkets that took positions supporting a "No" vote. Speaking on Business Daily, he says there is a danger they could be shunned by shoppers.

     
  6.  
    BUSINESS REACTION 08:53: World Service

    Business Daily on BBC World Service, is coming live from Edinburgh and speaks to Sir Brian Souter, founder of the Stagecoach Group of bus and rail operators and a supporter to the "Yes" campaign. He says it's "unfortunate" that business became so involved in the debate. He thinks that some business leaders who spoke out "would not dream of" telling their US customers how to vote.

     
  7.  
    CITY REACTION 08:47: BBC Radio 4

    Sir Tom Hunter, the former owner of Sports Division and Scotland's first home grown billionaire, tells the Today programme that the high turnout for the vote was "fantastic for democracy". "I think Scotland has rocked the political establishment from its roots in Westminster," he adds.

     
  8.  
    MARKET REACTION 08:34:
    Alix Stewart

    The BBC's Simon Jack is at Schroders in London's financial district. On BBC World News he speaks to market strategist, Alix Stewart. "We can go back to concentrating on the economy," she says. "It's clear rate rises will be coming," she reminds us.

     
  9.  
    LLOYDS REACTION Via Twitter Kamal Ahmed BBC Business editor
    Kamal Ahmed tweet

    Tweets: "Lloyds Bank statement on Scotland more equivocal than RBS. Keeping options open on legal domicile"

     
  10.  
    DEVOLUTION 08:23: Radio 5 live

    On Radio 5 live Simon Walker, director general of the Institute of Directors says the promised devolution of power will result in "big challenges". It should by about "enterprise and boosting competitiveness" in all regions of the UK and not "adding layers of bureaucracy".

     
  11.  
    MARKET REACTION 08:14:

    London's FTSE 100 index has opened 0.6% higher. Royal Bank of Scotland has jumped 3.3%, Lloyds Banking Group is up 2% and energy firm SSE is up 3.4%.

     
  12.  
    INTEREST RATES 08:10: Radio 5 live

    "The odds of a February rate rise should be pretty high now," says Ewen Cameron Watt, chief investment strategist at BlackRock Investment Institute on Radio 5 live. He thinks interest rates could move higher as early as November. A rate rise would have been "off the cards" for most of next year, if there had been a "Yes" vote, he says.

     
  13.  
    LLOYDS REACTION 08:07:

    Lloyds Banking Group has made this rather nebulous statement: "Lloyds Banking Group has maintained a neutral stance in this debate as we believe the decision was to be solely a matter for the people of Scotland. The group is proud of its strong Scottish heritage and remains committed to having a significant presence in Scotland. We remain fully focused on supporting households and businesses in Scotland as well as right across the rest of the UK."

     
  14.  
    STANDARD LIFE REACTION 07:55:

    We had to call Standard Life to find out what they actually meant. The insurer told us it has "shelved plans" to move operations to London "for now". "We've no plans to move any of our operations," it adds.

     
  15.  
    STANDARD LIFE REACTION 07:54:

    Standard Life, one of the companies that threatened to partially decamp from Scotland in the event of a Yes vote, now says: "We will consider the implications of any changes for our customers and other stakeholders in our business to ensure their interests are represented and protected." It adds it is "now important that we all move forward with respect and work together constructively in the best interests of Scotland and the UK". So that's clear then.

     
  16.  
    SCOTLAND POWERS 07:42:
    Prime Minister Cameron

    Prime Minister David Cameron has promised to come up with plans for new Scottish powers on tax, spending and welfare. The government is aiming to get an agreement by November. The BBC's personal finance reporter Brian Milligan is having a closer look at what that could mean.

     
  17.  
    MARKET REACTION 07:33: BBC Radio 4

    Anne Richards, chief investment officer at Aberdeen Asset Management tells Today: "A very close vote would have been a difficult one for markets." She adds: "I think we have had a reconnection between the political establishment, business and the electorate. And it would be good to see that momentum maintained going into the general election."

     
  18.  
    07:29: HEADLINES
     
  19.  
    ALIBABA SHARE SALE 07:29:
    Alibaba

    Away from Scotland's vote, shares in Alibaba start trading in New York later today. It has raised $21.8bn (£13.2bn) in one of the biggest ever stock market debuts. It is likely to use the money to expand in the US where it has a very low profile. A survey by Reuters showed that 88% of Americans had never heard of China's biggest internet firm.

     
  20.  
    RBS STATEMENT 07:21: Kamal Ahmed BBC Business editor

    Royal Bank of Scotland has given a statement to the BBC's business editor, Kamal Ahmed, it says: "The announcement we made about moving our registered head office to England was part of a contingency plan to ensure certainty and stability for our customers, staff and shareholders should there be a 'Yes' vote. That contingency plan is no longer required. Following the result it is business as usual for all our customers across the UK and RBS."

     
  21.  
    REFERENDUM REACTION 07:14: BBC Radio 4

    Patrick MacDonald former boss of John Menzies, tells the Today programme the debate over Scottish independence has changed the country forever. "Things will never be the same again," he says. There is now "a need to reform our 300 year old constitution" and the country also needs to work at reconciliation to "make sure businesses stay in Scotland".

     
  22.  
    RBS 07:08: BBC Radio 4

    A little more from Mike Amey on the referendum result. He tells Today: " I suspect there's a very large sigh of relief at RBS [over the result] They don't have to worry about where they were going to be based and how they were going to conduct their future business."

     
  23.  
    MARKET REACTION 07:07: BBC Radio 4

    Mike Amey, managing director and portfolio manage at bond trader PIMCO tells Today he expects the markets to open higher as a result of the Scottish referendum result. "It will be back to the data for our traders and what the Bank of England will do [on interest rates]."

     
  24.  
    MARKET REACTION 06:49: Radio 5 live

    Adam Parsons is in the City at the offices of stockbrokers IG with their chief market strategist, Brenda Kelly. She says the opening of the FTSE 100 might be quite as dramatic as some expect. That's because markets have been predicting this outcome over the last few days. However, she says, it could "break through 6930" which would be a record high.

     
  25.  
    06:42: Via Email Linda Yueh Chief business correspondent

    There are other uncertainties now for Scotland after this vote. But, for markets at least, the big uncertainty that could have lingered for a year and half over the currency and the economy is lessened and sentiment is positive as a result.

     
  26.  
    06:33: Louise Cooper, CooperCity market blog

    "So it's up up and away this morning, the question is how far does it [the pound] go before reality sets back in and other political fears begin to dominate: The rows in Westminster over devolution max which has been promised. The General Election and the UK referendum on EU membership. Party conferences season resumes next week so there will be plenty of headlines to be written about the next set of political risks."

     
  27.  
    CITY REACTION 06:27:

    The Lord Mayor of the City of London, Fiona Woolf has welcomed the outcome of the Scottish referendum. "The proposed enhanced devolution that Scotland will experience while remaining in the UK will enable its national spirit to thrive while our entwined economies and business communities prosper together," the Lord Mayor said.

     
  28.  
    YES CAMPAIGN CONCEDES 06:23: BBC Radio 4
    Scottish first minister Alex Slamond

    Scotland's first minister Alex Salmond has hailed 1.6 million votes for independence. He concedes that "we now know there is going to be a majority for the "No" campaign". Scotland has, by majority at this stage, voted not to become an independent country," he adds. He expects devolution promises to be honoured with "rapid force".

     
  29.  
    ROYAL BANK OF SCOTLAND Via Email Kamal Ahmed BBC Business editor

    With No confirmed as the winner in the referendum, we can expect the Royal Bank of Scotland to say there is now no need to move domicile to London. The bank had prepared for a "Yes" vote by saying last week that it would move its headquarters from Edinburgh. I wouldn't be surprised if Ross McEwan, the chief executive, re-iterated the bank's commitment to Scotland. I am sure RBS's executives are relieved that the upheaval of independence will now not happen.

     
  30.  
    POUND STRENGTHENS 06:12:

    A decisive win for the No campaign could lead to big spike in the Pound. Jeremy Cook, economist at World First says. The obvious risk to the currency markets was a Yes, and that would have caused a big sell off. Now the markets will go back to concentrating on the fundamentals of the UK economy," he adds.

     
  31.  
    SCOTLAND INVESTMENT 06:01:

    Simon Walker, director general of business group the Institute of Directors has given an interview to the BBC. He says he thinks the government will now give the green light to investment projects that had been previously held up because of the uncertainty caused by the independence referendum. He adds the ending of that uncertainty will be positive for business.

     
  32.  
    POUND STRENGTHENS 05:54:
    pound versus dollar

    This chart shows the pound against the dollar over the last month. You can see it dipped to a low of $1.6071 on 10 September. That was after a poll in the Sunday Times showed a lead for the "No" campaign. It is now trading at $1.65. That's a move of 5 cents which is pretty big over two weeks.

     
  33.  
    MARKET UPDATE 05:47: BBC Radio 4

    Asian markets are up nearly 2% overnight BBC business correspondent Linda Yueh, tells Today. The market indications are that the FTSE 100 will open 0.7% higher. That's not exactly a surge but it is a positive reaction.

     
  34.  
    BANK OF ENGLAND 05:42: BBC Radio 4

    Justin Rowlatt is down at the Bank of England for BBC Radio 4's Today programme: He says the lights are on and staff are busy working inside. Although perhaps not quite as frantically as if Scotland was looking on course to vote Yes in the referendum. Bank governor Mark Carney cut short a meeting to fly home overnight. "He may have had a wasted trip," Justin says.

     
  35.  
    POUND STRENGTHENS 05:36:
    Pound dollar

    This chart shows how the pound has faired against the dollar since the polls closed in Scotland on Thursday evening. As you can see it's strengthened from a low of $1.63 to above $1.65, that's its highest point since the start of the month. In currency market terms it's also a huge move in a short space of time.

     
  36.  
    05:30: Ben Morris Business Reporter

    The pound has bounded higher overnight in reaction to the Scotland vote. More reaction through the morning. Stay with us.

     
  37.  
    05:30: Matthew West Business Reporter

    Morning folks. It looks like - with 26 of 32 local authorities now having declared the result of their ballots- that the No campaign is on course to win the Scottish independence referendum. We'll bring you all the reaction from the financial markets and the business community as it comes in. As always if you want to get in touch you can email us at bizlivepage@bbc.co.uk or tweet us @bbcbusiness.

     

Features

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.