Subscribe Free
in Air Transport / Technology

Inflight broadband creating potential $5.2bn market in Middle East by 2035

Posted 23 January 2018 · Add Comment

Inflight broadband has the potential to unlock a $5.2 billion market within the Middle East region by 2035, according to new data released today from the ‘Sky High Economics: Quantifying the commercial opportunities of passenger connectivity for the global airline industry’ report.



Carried out by the London School of Economics and Political Science (LSE) in association with Inmarsat, the study forecasts that airlines in the region will take a $1.3 billion share of the boost in ancillary revenues.

Based on current IATA data and industry sources, Sky High Economics shows that airlines around the world will benefit from four new revenue streams:

  • Broadband access charges – providing connectivity to passengers inflight
  • E-commerce and destination shopping – making purchases on-board aircraft with expanded product ranges and real-time offers
  • Advertising – pay-per-click, impressions, sponsorship deals with advertisers
  • Premium content – providing live content, on demand video and bundled W-IFEC access

Using the independent forecasting model, specially developed for the research, the quantified revenue opportunities for the airlines in the region are as follows:

Predicted airline profit of broadband enabled ancillary revenue opportunity in the Middle East:


The research argues that as passenger numbers grow globally, so too will passenger expectations for access to high-quality inflight connectivity. The data shows that when it comes to passenger value brought about by new, Wi-Fi enabled ancillary revenue streams, airlines will benefit from an extra $3.21 per passenger.

At present, airlines around the world average an additional $17 per passenger from ‘traditional’ ancillary services like duty free purchases and inflight retail, food and drink sales.

Also, despite the gradual blurring that has occurred in the airline type selected by many business passengers, the Middle East region continues to represent one of the higher revenue opportunities for both domestic and international FSCs (Full Service Carriers) – in 2035, the split is LCC (Low Cost Carriers) at $239m vs FSC at $511m. The research confirms the very strong position many global FSCs have that are based there.

Dr Alexander Grous (B. Ec, MBA, M.Com, MA, PhD.), Department of Media and Communications, LSE and author of Sky High Economics, said: “The airline industry is rapidly evolving across the world, including the Middle East. This research shows that airlines have a clear strategic opportunity to become distinctly more retail-focused and reap the benefits of this.”

Ben Griffin, Vice President, Middle East, Africa and South Asia at Inmarsat Aviation, commented: “The latest advancements in satellite technology have unlocked exciting new opportunities for airlines to enhance their passenger experience, increase their operational efficiencies and grow important new revenue streams.

“Having the right capabilities in place – from the cabin to the cockpit – is the key to benefitting from everything that a connected aircraft can offer, today and in the future. As the Sky High Economics report has identified, airlines in the Middle East are extremely well positioned to take a lead with the game-changing new trend.”

 

 

* required field

Post a comment

Other Stories
Advertisement
Latest News

Jazeera Airways announces Q1 2018 earnings

Jazeera Airways has announced its financial results for the first quarter of 2018.

Flydubai to operate flights to Sulaimaniyah

Fydubai has announced that flights to Sulaimaniyah, Iraq, will resume from 10 May 2018.

Ras Al Khaimah snapshot flight returns with Seawings

Seawings’ Ras Al Khaimah new season snapshot tour has returned to target the growing tourist market to the Emirate.

Rwanda launches ‘Bucket List Rwanda’ Travel Packages exclusively for Middle Eastern residents

The Rwanda Development Board, Rwanda’s governmental organisation responsible for promoting Rwanda’s tourism initiatives abroad, has launched luxury and weekend getaway packages, which have been exclusively tailored for

Etihad launches loungewear collection at the Louvre Abu Dhabi

Etihad Airways leveraged its sponsorships of global fashion weeks and its Platinum Partner status of Louvre Abu Dhabi to launch a new Emirati designed loungewear collection at an exclusive reception held last night at the iconic

FedEx Express named a UAE Great Place to Work

FedEx Express, a subsidiary of FedEx, has for the eighth consecutive year been ranked amongst the ‘Best Workplaces in the UAE’ for 2017-2018, by Great Place to Work.

TAA SK0902311218
See us at
SOFEX BT2018Global Aerospace BT2018AirportShow BT1502090518ASDubai BT1004091018MEBAA BT1004121218BIAS BT271017161118Istanbul Airshow BT22018Cargo BT1004091018EBACE 2018GATM BT1004061118