History of IFE Systems: The introduction of wireless systems
The IFE systems improved over the time. However, the high installation costs and their weight remained an issue. That changed with the third major paradigm shift in IFE: wireless systems. Let´s see which impact this idea had and where IFE is going in the future in the last part of our blog series summarizing the history of IFE.
- In part 1 of our blog series we had a look at the beginning of IFE.
- In part 2 we described the development from communal screens to personal screens.
- In part 3 we remembered that the industry had to deal with some notable failures in the Nineties.
- Last time, in part 4 we took a look at how to provide the content.
In addition to reliability and system cost, the rising cost of fuel over the last several years has made system weight an IFE issue, as Lumexis foresaw. Therefore, when in 2011 IFE systems emerged that could eliminate the cost of wiring, as well as use tablet, smartphone and laptop screens that passengers were carrying onboard in place of airline-provided screens, this seemed to qualify as the IFE industry’s third significant paradigm shift. While carriers like British Airways, Emirates, and Singapore Airlines may always offer lavish embedded IFE systems, the temptation for an airline to provide the wireless delivery and content, with either the airline or the passenger providing the screen, may be the future for many airlines as it was for Virgin Australia that installed a wireless system from Lufthansa Systems in 2013.
Despite cutbacks in other areas to reduce costs, and despite the failure of IFE business models to generate sufficient revenues to seriously mitigate their costs, airlines remain committed to IFE. The worst of the problems of the 1990s are being left behind, and companies like Lufthansa Systems, Panasonic Avionics, Thales, Zodiac and others continue to deliver IFE systems with increasing sophistication and growing quantities of content that successfully address the challenges of providing living room-quality entertainment high above the ground.
Personalized services and programmatic advertising
The emergence of targeted, personalized and programmatic advertising in IFE may improve the revenue generation potential of IFE. What will the next paradigm shift in IFE be? The migration into digital platforms hosting IFE, connectivity and a range of applications with the aircraft as a datacenter? This is a concept in which Lufthansa Systems has been a thought leader. Will it be the migration from the use of the IFE system as entertainment to its emergence as a communications portal with airlines proactively promoting engagement with its passengers? Will it be the emergence of data analytics? Will it be the emergence of cloud-based processing and delivery of content? Or will it be the aggregate of all of the above—with Lufthansa Systems emerging as the leader?
One thing is clear: The IFE market will continue to grow as passengers expect the same entertainment and connectivity they are used to on the ground. At the end of 2013, this market was worth more than US$2 billion annually. By 2025, the combined inflight entertainment and connectivity market is forecast by some to reach US$9.8 billion. Let´s see where it will take us in the next chapter of the history of IFE.