Dave Davis, CEO Global Eagle Entertainment.
Global Eagle Entertainment (GEE) CEO Dave Davis says he sees strong potential for inflight connectivity sales in international markets.
Davis was speaking at the 2016 Internet, Media and Telecommunications Conference in Las Vegas, adding that GEE is now “global leader in the inflight content, connectivity, and digital media” business for the airline industry.
“We have 200 airline customers and our inflight connectivity systems are now installed on close to 700 aircraft around the world,” Davis said.
He added that GEE now has around 1,000 employees and is geographically diverse. Its biggest market sector is content services, but its broadband Ku-based inflight connectivity system also enables live TV broadcasts to aircraft.
Global Eagle revenues
GEE’s revenues from inflight connectivity rose from £11m in 2012, to £51m in 2013 and £75m in 2014.
Davis said that the number of connected aircraft in the world was heavily weighted on North America. “If there are 4,000 connected aircraft in the world, around 3,000 of them are in the United States and Canada,” he said.
“The domestic market is about 70% penetrated, but if you look at the international market only about 7% has some form of inflight connectivity on board. It is in its very early stages.
“So we see all the significant growth opportunities in future to be in the international market and that’s where our sales effort is focused.”
He added that in the last year or so, it has not been a question of “if” an airline will adopt inflight connectivity, but “when”.
“Airlines are cautious and take a long time to make decisions,” he said. “And one of the forcing factors behind decisions is ‘what are my competitors doing?’.
“So I think once inflight connectivity is seeded in a [geographical] area you’ll see other airlines in that region adopting it.
“I really think we are at an inflexion point on the S-curve. We are busier than ever in responding to requests [for information] from airlines and 2016 will be a year of accelerations and decisions being made.
“Regionally, we expect more activity from Latin America. India is also an interesting place as is China and I expect to see at least one decision from a major European carrier in the first part of 2016.”
Davis said GEE has a backlog of around 200 aircraft installs, which will take around two years to complete.
He also hinted that GEE will soon make other announcements about new inflight connectivity customers, beyond its existing announcements about flydubai, Hainan Airlines and Beijing Capital Airlines.
On the question of how inflight connectivity should be funded, he said that we can expect to see a diverse mix. “I don’t see one overall business model taking over,” he said.
He was questioned about the Ka-band connectivity available on JetBlue/United, as supplied through Thales (formerly LiveTV).
“In North America I think they are a viable competitor, but internationally I think it is dramatically less so,” David said, pointing to the lack of coverage currently available from ViaSat’s satellites in other parts of the world.
He did not comment on Inmarsat’s imminent introduction of its Ka-band Global Xpress service.
He also spoke about GEE’s future in the e-Enabled aircraft market, after two recent acquisitions, NavAERO and Masflight, has positioned it better for the transfer of operational data and EFB information to and from the ground.
“The potential leverage of this information for airlines is tremendous,” he concluded.
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