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Message: Hot Topic: The IFE Market: Part 2 The Heavy Iron

Hot Topic: The IFE Market: Part 2 The Heavy Iron

posted on Dec 12, 2005 07:52AM
Hot Topic: The IFE Market: Part 2 The Heavy Iron

Wide-Body aircraft, or twin-aisle planes, had represented the bread and butter for IFE companies as the new planes came off the line. Big ticket sales, high dollar, contracts and huge battles for Boeing and Airbus new business, earmarked the IFE market in the pre-911 time period. As sales declined, vendors re-tooled their products to fit the smaller plane market but in the last year, big iron sales have been looking up. Both new deliveries (Boeing 72 and Airbus 90 projected for 2005) and the second generation of older wide-body retrofits) are starting to look up again. With a fleet of some 6393 big jets and an average IFE price of $6000 to $15,000 per seat, fleet sales of IFE can be staggering. In 2005 delivery installations, we expect to see MAS, Thales, and Rockwell to garner the top delivery spots, however, 2006 may be more interesting. Retrofits of 30 year old planes like the B-747 still come in as airlines try to compete against competitors new planes with tricked out interiors and IFE. These retrofit numbers will probably be in the 50 to 150 range and are very sensitive to factors like fuel cost, competition, route structure, and the like.

On the horizon, new strategy drivers are heating up the big aircraft war again. Vendors are reporting new interest in higher feature, longer playing IFE for delivery aircraft as the route structures shift to point-to-point service. Singapore Airlines is only one example of an airline who now offers Singapore to New York flights that last an astonishing 18 hours and cross 10 time zones. Passengers get there faster (a big driver) and need a bigger fix of IFE. This craze will be aided by planes like the B787, the B777-400ER, and the A340-500. Lets face it, bypassing one hub or international portal is good for everybody lower costs from fuel and landing fees, less total trip time, and baggage arrival probability that is greatly enhanced.

All this boils down to some new and interesting IFE possibilities, here are just a few: new emphasis on connectivity and TV for super long haul flightsbig server capabilities for more movie and audio choicemore interactivity with the system and the crewnew, big, LCD screens (been to the video store lately)Wi-Fi for many applications including entertainment and passenger communicationSeat power, seat power, and more in-seat powerback office passenger tracking and reportingVOIP for personal and crew callingand on, and on. Competition for delivery aircraft will remain in the hands of the big three, no doubt, so the retrofit market will be the focus for smaller developers and hardware manufacturers but history there still favors the entrenched producers as a retrofit is very challenging from an engineering perspective. Next year should be another good year with at least a 6% growth rate in delivered planes, or so the pundit say. Stay tuned!

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