IFEC Profit Margins – In-flight Entertainment for Airlines
IFEC profit margins for business jets and commercial airlines is of vital importance. In the not too distant past, airlines depended on essentially the same technology for IFEC, aka In-Flight Entertainment Connectivity, as in most any movie theater.
A film was shot directly onto a screen using a projector, and customers could listen to the film via proprietary headsets or listen through in-cabin speakers. For many passengers, this was not an ideal situation.
This has changed and changed drastically in a very positive way for all parties involved. The main reason for going to this new system is the same as any reason a business makes changes – to increase IFEC profit margins and satisfy shareholders. It all comes down to weight on the plane. Weight is a major issue on flights. Some airlines have removed the seat back screens from their airlines, cutting weight by 1,200 lbs. A lighter plane means less fuel; less fuel means a better profit.
People have not seemed to mind this change for IFEC. The main reason is the advent of newer and newer technologies as gone are the bulky, heavy laptops of old (remember that weight issue) requiring lots of storage space. Touchpads, smartphones, and the like have changed computing in a way like Bill Gates did with Windows 3.1. Research already points to handheld devices reaching over 2 billion this year based on previous information from 2014.
Weight is Equal to IFEC Profit Margins
This is a welcome change for airlines, where again, weight is equal to profits. IFEC has certainly gone through its own growing pains from silent films to bulky 8mm, grainy machines to DVD’s and projectors. Along the way, passengers have been kept happy, entertained, and not as concerned about long delays, waits and unforeseen circumstances that kept a plane grounded for an indeterminate amount of time.
Jump forward several years, and now we have streaming video, movies and more coming in over wireless and data from cellular providers. For the airline industry, this is an absolute goldmine in IFEC profit margins. Gone will be the days of the same film showing for all passengers, young and old. Finding a movie suitable to keep all passengers entertained for a flight can be virtually impossible. Instead, passengers will be able to use personal devices to log into the plane’s on-board wi-fi system. Watching personal devices for Netflix, Hulu and YouTube is obviously a preferred method of IFEC over a single, one-size-must-fit-all movie.
Power of Choice will Increase IFEC Profit Margins
A customer, or in this case a passenger, who has some degree of choice in a situation is likely to be much happier and willing to accept certain situations and possible additional fees for the trade-off of continued in-flight entertainment. Families traveling with young children certainly understand the value and power of a portable DVD or gaming system to entertain, and adults benefit just as much when left in a similar situation. In other words, on a plane, everyone is a child wanting to know, “Are we there yet?”
The early Internet was certainly filled with its share of mistakes, drops and vicious lag that kept most everyone more annoyed than anything. Companies who provided Internet needed vast storage often kept at temperatures where a jacket or coat would be necessary due to the enormous amounts of heat generated by the systems. Today is a completely different story. Adding a server and the wiring for a completely wireless system in an airplane is almost no different from wiring a new business and networking computers and printers. The chief difference is the use of the Internet for pleasure over business, but one can realistically expect business to be happening as well during flights with free Internet as essential for IFEC profit margins.
While many would like to think of the wireless as free, nothing is free. Passengers interested in using the on-board wireless may have to listen to the occasional commercial interruption or pause during their movies or videos, but it is a small price to pay for the absolute convenience this offers. Consider this: many of the YouTube channels that are run by commercial entities often preview their own videos with a brief commercial often about their own product. An airline would do quite well with this content marketing strategy, particularly when they have a captive audience of sorts.
Future of IFEC Profit Margins
There is and will be plenty of room to grow from this point with IFEC profit margins. Commercial lines still must balance their customer needs and wants with shareholder expectations and desires. Wireless connectivity and IFEC on an airplane, however, is quickly advancing like the ideal window seat.
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