Global Times

Wi-Fi to board more Chinese aircraft

Long-term prospects bright for huge domestic aviation market as internet services guarantee passenger loyalty

- By Ma Jingjing

In-flight internet services are expected to attract more passengers in the Asia-Pacific region amid a period of consumptio­n upgrading, but China still has a long way to go in this regard due to challenges in satellite resources and business models, industry insiders said.

Nowadays, in-flight Wi-Fi is a key driver in securing customer loyalty and satisfacti­on among airline passengers in the region, said a report jointly released on August 8 by London-based satellite telecoms firm Inmarsat and market research company Populus.

The report found that 67 percent of passengers in the region consider in-flight Wi-Fi crucial, while 78 percent of passengers said they would rebook their flights with a different airline if it offered high-quality Wi-Fi.

Apart from attracting more passengers, in-flight Wi-Fi can generate new sources of revenue such as internet access, duty-free shopping and e-commerce, Li Wei, director of China Aviation Market Developmen­t at Inmarsat, told the Global Times on Wednesday.

However, in-flight Wi-Fi is far from being commonplac­e among Chinese airlines. As of June 2018, there were over 3,360 registered airplanes in the Chinese mainland market, but only around 3 percent of them provided internet services. That level is far below in-flight Wi-Fi rates in North America, Europe and the Middle East, Li said.

“Some Chinese airlines haven’t anticipate­d the influence that internet services could have on their operations, while some hesitate accelerati­ng the layout of in-flight Wi-Fi due to the emergence of problems like slow internet speed,” she explained.

The data created when passengers browse Web pages onboard Chinese aircraft that fly across the border would be stored in stations in China to guarantee informatio­n security, Li said.

A lack of satellite resources as well as vague business models, however, make Chinese airlines’ internet services lag behind those of internatio­nal airlines, one industry insider, who prefers to remain anonymous as his company’s satellite technology is still developing, told the Global Times on Wednesday.

“In-flight Wi-Fi covers basic telecommun­ications services, whose strict and long approval processes are beyond people’s imaginatio­n. Currently, only centrally administer­ed State-owned enterprise­s have operation qualificat­ions,” the source said.

As for satellite resources, he said that high quality internet services should be based on high-throughput communicat­ions satellites, but China only has one such satellite – the chinasat-16. “This satellite is not perfect enough to provide services,” the insider said.

At present, existing in-flight Wi-Fi in China is based on traditiona­l satellites instead of the chinasat-16, with services too poor to guarantee basic network performanc­e, let alone to help develop innovative business models, the source noted.

Many Chinese aviation pioneers are struggling to survive in this regard.

Beijing Business Today reported in July that Shareco, a subsidiary of HNA Group that focuses on in-flight connectivi­ty, defaulted on the payment for goods supplied by e-commerce platforms. Shareco recorded a net loss for four consecutiv­e years in 2017.

Market to boom

Despite facing losses, industry players still feel optimistic about the future prospects of the industry, finding reassuranc­e in positive signs.

Chinese airlines carried 550 million passengers in 2017, up 13 percent yearon-year, data from the Civil Aviation Administra­tion of China (CAAC) showed in February.

Boeing predicted that China will need 7,240 new airplanes in the coming 20 years, the Xinhua News Agency reported in September 2017.

Given China’s huge aviation market, in-flight Wi-Fi can bring about great opportunit­ies, with airlines, internet providers and e-commerce platforms all set to benefit, according to Li.

A joint study conducted by Inmarsat and the London School of Economics showed that by 2035, planes with inflight Wi-Fi will be in operation all over the world, creating a new market worth $130 billion and bringing additional revenue of $30 billion to airlines.

Now, China is accelerati­ng the applicatio­n of in-flight Wi-Fi. Following the CAAC’s January announceme­nt, which stated that airlines could decide on their own whether to allow the usage of electronic devices on their flights, domestic carriers such as Hainan Airlines and China Eastern Airlines have began piloting Wi-Fi services.

“China’s in-flight Wi-Fi venture has started late and it’s understand­able that it’s laggard. But China’s internet industry has been at the global forefront. With satellite resources and policy support, the country’s in-flight Wi-Fi sector will definitely grow fast,” the industry insider said.

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 ?? File photo: VCG ?? A China Eastern Airlines flight attendant shows passengers a sign advertisin­g in-flight Wi-Fi at Qingdao Liuting Internatio­nal Airport, East China’s Shandong Province.
File photo: VCG A China Eastern Airlines flight attendant shows passengers a sign advertisin­g in-flight Wi-Fi at Qingdao Liuting Internatio­nal Airport, East China’s Shandong Province.

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