Scandinavian Airlines Exec Highlights Connectivity Plans for 2020
Scandinavian Airlines (SAS) has long been considered one of the pioneers of offering In-Flight Connectivity (IFC) services to passengers. The airline, which works with Inmarsat, has exciting plans for 2020, as it looks to increase services across its fleet. In an exclusive interview with Via Satellite, Thérèse Lorenius, SAS vice president of products and services, said that because SAS’ long-haul fleet has been connected since 2015, the company is focusing its attention on its short-haul fleet. SAS intends for its short-haul fleet to be fully equipped and ready during the fourth quarter of next year. Its new A350 fleet will be equipped with IFC services at delivery.
“The present business model is to give free Wi-Fi to our most frequent passengers, who see the airspace as their second office, meaning the highest tiers in our loyalty program, EuroBonus, as well as to passengers traveling in our Plus and Business classes. Passengers in Go (economy) pay a small fee for the service. It is important to listen to the passengers and adapt if needed. So far, we have been successful with our model,” Lorenius said.
Lorenius said that she sees the airline as a leader in the European market when it comes to delivering a smooth passenger journey supported by smart digital services. “Our overall objective is to continue to be the passenger target group’s natural choice by providing easy, clear and time-saving products and services, all linked to an unmatched network and a schedule with frequent departures,” she said. “We strive to facilitate and make planning, booking, and taking a trip easy for customers. Irrespective of whether you travel on business or pleasure, today’s travelers expect the same level of ease, clarity, and efficiency. Connectivity plays a key role in this.”
SAS signed a significant deal with Inmarsat this year. The airline selected Inmarsat’s GX Aviation in-flight broadband service for its brand-new fleet of Airbus A350 aircraft. SAS has ordered a number of new Airbus A350 aircraft as part of an extensive fleet renewal program, the first of which will be delivered from the Airbus factory in Toulouse at the end of this year, with GX Aviation pre-installed. As for why SAS decided to go down this route, Lorenius said, “To offer Wi-Fi onboard is quite different than on ground. During a long-haul flight, an airplane passes various zones and it is crucial to be connected to a satellite. We did a thorough study on which operator that could offer connection no matter what zones and distances we fly. For a line fit aircraft there are not many suppliers to choose from. It was in this case of great importance to have full global coverage and a robust supplier roadmap. For the A350 fleet, Inmarsat was the best choice for us.”
Lorenius said Wi-Fi has become a commodity these days and it is a means to deliver on SAS’ brand promise to make life easier by making time matter to travelers. She said the airline wants its passengers to make full use of their time onboard without the need to change their behavior because they are on an aircraft. The key plan is to continue the implementation on the short haul fleet.
Some airlines have gone down the business model of offering IFC for free. Others believe that the costs involved in equipping aircraft justify a fee. How does SAS view the business model? “A fee in itself will never be sufficient to pay for Wi-Fi installations. You need to see this as a competitive advantage or service feature that will make customers choose your airline in the first place and continue flying with you. The business model must be flexible and easy to adapt to changes in customer behavior and future digital development on ground,” Lorenius said. “Each airline is different depending on its own business model and strategy in general. Thus, the Wi-Fi offering must reflect how you build your Wi-Fi offering to fit into the overall airline strategy. It also depends on the market you operate in, your competition, and why you want to offer this service to the passengers. It is therefore not possible to give a straightforward answer to that.”
So, where does SAS’ connectivity offer go next? The airline has a number of ongoing partnerships, from streaming services to restaurant bookings. It also sees an opportunity to increase ancillary sales of its own travel related products, like upgrades and seat reservations. SAS is also negotiating with authorities with the aim of offering a full gate-to-gate Wi-Fi experience. “The context the passenger is in plays an important role in the success of the offer. A large number of our customers travel for business reasons and want to see their travel in the air as their office, while leisure travelers look for inspiration, relaxation, and want to stream just like home,” Lorenius said.
She mentioned a takeaway has been that IFC involves not only the product department, but all departments, including the crew.
“Having your colleagues onboard and engaged, is so important for success,” she said. “A good governance process with your supplier and general troubleshooting involving your operational teams are also key. And most importantly, it is an ongoing development. Nothing is finished once you have the antenna on top of an aircraft.”
Interestingly, Lorenius believes there will be more discussions in the airline industry around new alternatives such a Low-Earth Orbit (LEO) satellites, air to ground development in Europe, etc.