Finnair is one of the most progressive airlines in Europe when it comes to connectivity and has ambitious plans in terms of bringing new services to passengers. Last year, it signed an agreement with ViaSat to install a high-speed wireless internet network on its entire Airbus A320 series short-haul fleet flying in Europe. The installation of the Wi-Fi equipment will begin in May 2017 and will be completed by June 2018. We recently caught up with Harri Valkama, manager of Inflight eCommerce & IFEC at Finnair, to get the latest on the airline’s strategy.
What is Finnair’s roadmap for offering in-flight connectivity services? What is your vision of the concept of the ‘Connected Aircraft’? What are the key plans for 2017?
The Finnair A350 fleet is linefitted with Panasonic eXConnect (KU-band). We have seven aircraft at the moment and four more coming in 2017. In 2023, we’ll have total of 19 A350s. Twelve of the 19 are now awarded to Panasonic. We are also retrofitting our A330 fleet with Panasonic eXConnect. Five out of eight aircraft are already done, and the whole A330 fleet is ready at the end of May 2017. During the summer 2017, we’ll start our A32 fleet’s connectivity installations, and the whole fleet (34 aircraft) is installed at the end of summer 2018. We’ll have ViaSat Ka-band solution for the A32s fleet. We have not made any decision on connectivity for the Embraer and ATR fleet. We want to offer personal and relevant digital services to our customers throughout the whole customer journey in all of our digital channels (www, mobile app and IFE/Wi-Fi). Connected aircraft is a key element in that. Connectivity also boots our ancillary and other sales in the aircraft and brings the operational efficiency.
When do you expect to have your whole fleet connected with Wi-Fi? What business model are you implementing? Why do you think it will be successful?
The whole fleet will be connected at the end of summer 2018, excluding Embraers and ATRs. At the moment, the Wi-Fi is chargeable in economy class and complimentary in business class and also for Finnair Plus Platinum and Gold members. Our business case is not based on Wi-Fi sales only. There are several other revenue streams enabled by Wi-Fi, and we think that overall the business case is successful for us.
At our Global Connected Aircraft Summit in 2016, Patee Sarasin of Nok Air talked about the free model, whereas Sabine Hierschbiel of Lufthansa believes airlines will have to charge for access. What is your take on this?
We are all the time challenging and evaluating our business model for Wi-Fi. We don’t rule out different sponsorship and partnership models. We have built our open Wi-Fi ecosystem in a way that enables fast time to market for changes and trials. It is more than likely that internet access is complimentary for all the passengers in the future and it becomes kind of a hygienic factor.
How much bandwidth do you think is needed for passengers who are perhaps carrying a number of devices onto the aircraft? Do you believe your systems will be able to cope?
Our ViaSat Ka-band solution for A32s fleet will bring roughly 12Mbs bandwidth per passenger, and we think that’s plenty for all the devices for now. Also in the near future we’ll get the benefit from HTS Ku-band satellites for our wide-body fleet, and that will increase the capacity and bandwidth. We acknowledge that there will be a demand for more and more bandwidth in the future for our passengers as the passenger devices evolve, and we hope that the connectivity technologies keeps up with that demand.
What are your main initiatives in terms of bringing improved services to customers here?
One of our strategic development items is the Nordic Sky Wi-Fi portal that is already available in all of our connected aircraft. Nordic Sky portal is a constantly evolving platform where we offer a different kind of useful services for our passengers like shopping, news, entertainment, customer service and, of course, internet connection and much more. Nordic Sky portal is integrated with other platforms like seatback IFE, crew payment terminals and Finnair back office systems on the ground. Our ecosystem enables agile development where we can bring new services and products for our customers in fast pace.
What is the return on investment for Finnair on such services?
Any service that we implement has a positive business case that brings additional revenue, improves customer experience and satisfaction or improves our operational efficiency and cost savings.
A number of airlines have now launched these services. What have been your learnings from the market so far?
We have tried several different services, some of them successful and some not. It’s important to fail fast in these trials and learn from them.
Do you believe airlines have a lot to learn from other industries in terms of improving the overall passenger experience? Where do they need to get better?
We certainly believe that we have a lot to learn in everything that comes to the connected aircraft. It is a quite new thing in the commercial aviation and the possibilities are endless.
How do you see the market for IFC services for passengers developing over the next 12 months? What would constitute a successful year for Finnair in this area?
We think the services for passenger are developing into more and more personalized services over the next 12 months. A successful year for Finnair is, of course, high take-up rates for our Wi-Fi and also happy customers. GCA