AIRLINES carrying 57 per cent of the world’s passenger traffic have reported a real increase in IT and telecommunications (IT&T) expenditure and are ready to invest big on passenger mobile services and other transformative technology, according to results published recently in the 13th annual Airline IT Trends Survey from SITA/Airline Business.
Compared with 2010, 50 per cent of airlines are reporting an increase in total IT&T spend.
Despite concerns about market conditions and fuel prices, the outlook for 2012 is also positive with 54 per cent of survey respondents expecting budgets to increase, and 29 per cent expecting them to remain the same. More than 91 per cent of airlines plan to invest in passenger mobile services and 93 per cent are prioritising virtualisation technology.
Launching the survey, SITA chairman Paul Coby said: 'I see IT spend as the barometer of overall air transport industry confidence.
'Airline IT departments are delivering major transformational initiatives using advanced applications for areas like revenue management and optimising load factors. Virtualisation and cloud computing are going to be critical for both IT efficiency and managing cost. Ninetythree per cent of this year’s survey respondents plan to implement virtualisation technologies. Survey respondents are also telling us of their success in pushing more traffic and sales through their websites with corresponding improvements in ancillary sales and up-selling.
'Airlines continue to increase the proportion of tickets sold via their directly- controlled distribution channels and I predict that 2011 will see them overtake indirect distribution for the first time. If you extrapolate the trend, by 2014 58 per cent of tickets will be sold directly. This channel shift will reduce the share sold through GDSs and online travel agents.'
Passenger mobile service offerings from airlines are set to explode in the next three years with 91 per cent of responding airlines planning to invest in mobile device-based services for passengers.
The priority is on mobile services which support check-in, flight status notifications, electronic boarding passes and travel distribution. Airlines anticipate that by 2014, 15 per cent of all passengers will use mobile phones to check-in.
Of those surveyed, 85 per cent of airlines either already sell (33 per cent) or plan to sell (52 per cent) tickets through mobile phones by 2014 and most plan to extend mobile functionality to include ticket modification/upgrades and sales of onboard services.
The survey underlines how travel distribution has become a multi-channel environment with kiosks and social networks joining mobile phones as important emerging sales channels; 70 per cent of airlines already sell, or plan to sell, tickets through kiosks and social networks by 2014. At present, 19 per cent sell tickets through kiosks and 16 per cent through social networks.
Hani El Assaad, SITA regional vice president Mena, said: 'The number of airlines actively selling tickets on mobile phones has almost doubled from last year and we see clear plans now to offer richer functionality in the form of ticket upgrades and modifications.'
The survey confirms increasing interest in social networks as distribution channels. Today, 80 per cent of airlines either have or plan to have some presence on social networks and using social networks for ‘promotion of products and services’ has the highest level of implementation to date (41 per cent).
Respondents also revealed a strong shift towards the adoption of alternative usage of self-service kiosks. For example, the number of airlines with flight transfer kiosks has quadrupled since last year’s survey.
The Airline IT Trends Survey is an independent poll of senior IT personnel working within the top 200 passenger carriers.