Tablets to replace in-flight entertainment systems: Analyst

By Digital News Asia July 26, 2012

In-flight entertainment systems could be phased out in favor of tablets
Low-cost, full-fledged carriers to use this trend as additional revenue stream, value add to customers

TABLET computers could end up replacing in-flight entertainment (IFE) systems in major airlines as its portability and relatively low maintenance are strong impetus to make this happen in the near future.

According to Frost & Sullivan, IFE systems are a major part of airlines’ marketing programs and they affect pricing of the seats along with the overall experience, the company said in a statement.

Noting that the IFE system is the most cumbersome of the services provided by airlines during flight and needs regular and constant upgrade and maintenance, Ravi Madavaram, aerospace & defense consultant for Frost & Sullivan Asia Pacific, said a 5-star rated airline commonly upgrades its IFE systems every five years or so, in order to provide the latest and best-in-class in-flight service.

“IFE also forms a major part of line maintenance during transit checks which maintain or upgrade the IFE system attached to the seats.”

Tablets to replace in-flight entertainment systems: Analyst Several airlines have already begun introducing tablets as a replacement for their respective IFE systems including Malaysia’s AirAsia, who was the first airline to do so in Southeast Asia. The budget carrier was also the first to position it as an add-on package to their existing revenue stream, noted Frost & Sullivan.

Madavaram noted that American Airlines and AirAsia have adopted the Samsung Galaxy Tab 10.1 as their choice, while Qantas has adopted iPads, provided by Panasonic.

He added that with tablets replacing traditional IFE devices, the whole value chain will see a major change as this opens a new revenue stream in addition to food, insurance and seat allocation revenues for low-cost carriers, and one which is relatively easier to adopt.

“This will trigger more low-cost airlines as well as full service carriers to adopt tablets as IFE as the airline industry spends about US$1.2 billion a year for IFE maintenance,” said Madavaram. “With the advent of tablets into this space, the dynamics of this segment will alter significantly in the next few years.”

Madavaram said Panasonic is the current market leader in this segment and Samsung has been relatively unknown. But given the advantages of tablets, it is expected that Samsung would gain significant market share rapidly in the near future, he added.

“The dynamics of the industry will alter significantly with Samsung making major inroads into the market,” he said. “The service providers, maintenance technologies and processes will alter according to changes in the industry.”