Archive | April, 2012

Kiss Sleep Goodbye Thanks to Singapore Airlines’ New In-Flight WiFi

Kiss Sleep Goodbye Thanks to Singapore Airlines’ New In-Flight WiFi

There’s no way we’re going to get to sleep on those overnight A380 flights now, as it sounds like in-flight WiFi is making its way to Singapore Airlines.

Right now plans are still in the works regarding the entire international fleet, but for now there’s going to be some A380s connected to the World Wide Web no matter where you are above the earth. Thanks to plenty of satellites—and the OnAir system—your Facebook, Twitter, Gmail and whatever else accounts will just be a few clicks away. Honestly, we kind of feel a little badly for the inflight magazine right about now.

Loads of technology is required to get the internet to your tray table, and that is all going to come with a price. Thankfully it’s not too expensive, but it’s not unlimited like it is when you connect domestically withGogo. Instead, you’ll find it’s going to be around $12 for 10MB of data and $30 for about 26MB of data. That’s certainly not enough to stream a movie—or even a YouTube video—but it’s better than nothing. Which is a good thing for us, as we still might be able to catch up on some sleep after all.

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Virgin Chases Business Travelers with Tablets and New Planes

Virgin Chases Business Travelers with Tablets and New Planes

Virgin Australia will step up its chase for a larger slice of business travellers and has signalled its intention to one day expand its international flying, with the arrival of two factory-fresh Airbus A330-200s in May.

The wide-bodied aircraft feature a new business class and will be used primarily on services from Sydney and Melbourne to Perth, as the mining boom fuels demand for workers heading to the West Australian capital.

The airline also this week launched a trial of Samsung Galaxy tablet computers to provide entertainment to business class travellers.

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While the two A330s – which are due to enter service on May 15 – have been earmarked for the Australian domestic market, Virgin Australia chief executive John Borghetti says the aircraft have been designed with an on-board product good enough to fly internationally.

Moreover, the A330-200’s range meant the aircraft was capable of reaching cities such as Tokyo, Mumbai, Beijing and Honolulu from Australia and therefore “ideally suited” for international flights.

“We have got the flexibility of putting it domestically or internationally depending how the market is, depending on where our needs are,” Mr Borghetti said in an interview during a media visit of the aircraft at the Airbus Delivery Centre in Toulouse on Monday afternoon (local time).

Virgin has forged alliances with four global carriers, including Singapore Airlines, Air New Zealand and Delta Air Lines, and Mr Borghetti said any decision on whether to use the A330s on overseas routes would be made in consultation with those partners.

The two A330s feature 24 lie-flat seats in a two-two-two configuration in business class and 255 seats in economy, with on demand in-flight entertainment, power points for every passenger and soft mood lighting.

Virgin’s brand director Hans Hulsbosch said the new A330 product was designed with a clean, simple and bold look.

An Airbus A330-200 costs $US208.6 million ($A202.89 million) at list prices. However, airlines typically receive discounts – which are rarely disclosed – from those published prices.

Virgin Australia has ordered four of these new A330s, with three to arrive in calendar 2012.

Figures from Virgin’s results presentation in February showed corporate and government accounts now comprised 17 per cent of the airline’s total revenue, up from 13 per cent at the end of 2010/11 and approaching Mr Borghetti’s target of 20 per cent.

Virgin launched business across most of its network in January 2011 and Mr Borghetti said the response from the market had been better than expected.

“On some routes it absolutely exceeds where I thought we would be in 12 months,” he said.

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In-Flight Wireless Entertainment Cleared for Take-off, According to IMS Research

In-Flight Wireless Entertainment Cleared for Take-off, According to IMS Research

Global Wireless Entertainment Install-Base to Grow from around 80 in 2011 to nearly 9,000 by 2021

Largely only a trial offering today, wireless in-flight entertainment (IFE) is forecasted to reach a global install-base of nearly 9,000 aircraft by 2021, revolutionizing how passengers are entertained, able to communicate outside of the plane, and manage their on-going travel, according to a new report by IMS Research (recently acquired by IHS Inc. (NYSE:IHS)), a leading supplier of market research and consultancy to the global electronics industry.

“In-flight Wi-Fi and cellular communication is becoming increasingly common, particularly in the US, and today 1,000s of aircraft are fitted with equipment that allows passengers to connect to the internet,” says Alastair Hayfield, Research Director, IMS Research. “Today US airlines like SouthWest and Delta are offering in-flight internet access. However, the aim for many airlines is to be able to offer many other services wirelessly, vastly improving the travelling experience for everyone.”

At the moment, traditional IFE is usually available in the seat back or from the cabin roof. However, a new wireless solution is emerging that is removing the need for cabling, and removing the need for ‘fixed’ IFE systems altogether. Wireless IFE – sometimes known as wireless content distribution – beams media such as video, TV, games and audio, around the cabin to be received on passengers’ tablets, smartphones, or airlines’ own handheld devices.

Benefits of Wireless IFE to airlines include:

  • Delivering better in-flight customer service by enabling passengers to check on-going connecting flight information, gate numbers, make hotel reservations, book theatre tickets, and research and plan-ahead sight-seeing or other entertainment activities
  • Achieving weight reduction and overall economy by removing seat-back systems and wiring
  • The opportunity to create a new revenue stream by charging passengers for wireless IFE access
  • And the facility for budget airlines like Easyjet and Ryanair – currently with no IFE service – the ability to offer new, value-added services

“The inevitable take-off of wireless IFE has clear benefits to both the industry and passengers alike,” Hayfield adds. “Until very recently we have all been cut-off from the outside world when flying, dependent on a limited program of entertainment, or reliant upon our own media. But very soon we will all be able to access not only online content, but be able to communicate with family, friends and colleagues, keep tabs on on-going travel plans – anticipate and contingency-plan around potentially missed flights or delays.”

About the report “The Future of Wireless IFE – World – 2012 Edition”


“The Future of Wireless IFE – World – 2012” is a new report tracking this potentially ‘game-changing’ aerospace technology. The report tracks the current and future penetration of wireless IFE systems over the next ten years, with analysis by aircraft type, region, connectivity, and flight duration. 

About IHS Inc. (

IHS (NYSE: IHS) is the leading source of information, insight and analytics in critical areas that shape today’s business landscape. Businesses and governments in more than 165 countries around the globe rely on the comprehensive content, expert independent analysis and flexible delivery methods of IHS to make high-impact decisions and develop strategies with speed and confidence. IHS has been in business since 1959 and became a publicly traded company on the New York Stock Exchange in 2005. Headquartered in Englewood, Colorado, USA, IHS employs more than 5,600 people in more than 30 countries around the world.

About IMS Research:

IMS Research is a leading independent supplier of market research and consultancy to the global electronics industry, offering syndicated market studies, custom research and consultancy services. Clients include most of the household names in the industry. IMS Research has offices in Europe, the US, China, Taiwan, South Korea, and Japan. To find out more, contact IMS Research:; T: +44 (0) 1933 402255;

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Airlines Paving Way for Use of Wi-Fi Devices On Flights: Report

Airlines Paving Way for Use of Wi-Fi Devices On Flights: Report

For business and leisure travelers alike, a frustrating part of flying is lack of access to wireless services for work or entertainment. But that will change soon, as more airlines install equipment that will allow passengers to connect to the Internet, according to a new report.

Compassionate Eye Foundation | Getty Images

Only about 80 planes now have access to streaming wireless in-flight entertainment (IFE). But that number is forecast to reach nearly 9,000 aircraft by 2021, allowing passengers far more options for entertainment and communication, according to the report by IMS Research, a market research firm. The report was based on interviews with hardware suppliers and communications companies as well as a survey of 50 major airlines, says Alastair Hayfield, research director of IMS Research.

Deployment of such systems will begin in earnest this year, with a steady installation rate ramping up yearly to 2021, Hayfield said. Hundreds of planes in the U.S. already offer in-flight, WiFi connectivity. The plane acts as a hotspot. Wireless IFE is a step beyond, as a server is installed in the aircraft that allows a range of content such as video, games, audio and connectivity to be beamed around the cabin from providers such as Netflix [NFLX  87.77   -14.07  (-13.82%)   ] , Hulu, Amazon [AMZN  189.31    1.07  (+0.57%)   ] Pandora[P  8.5578    -0.0022  (-0.03%)   ] and Spotify.


Wireless in-flight entertainment systems on planes would allow passengers to use their own devices to access the Internet, and also to stream a wider selection of content than can be stored on their devices. Southwest [LUV 8.0773    0.1973  (+2.5%)   ] and Delta [DAL  10.54    0.15  (+1.44%)   ] are undergoing trials on the technology, according to the survey by IMS. Other airlines trying it out on a limited basis are American, Air China and Qantas.

At the moment, traditional in-flight entertainment like movies is usually available on a screen embedded in a seat back or hanging from the cabin ceiling. But Hayfield says a new wireless innovation is emerging that is removing the need for cabling, and taking away the need for fixed entertainment systems altogether. Wireless IFE systems beam media such as video, TV, games and audio around the cabin to be received on passengers’ tablets, smartphones, or airlines’ own handheld devices.

Those likely to benefit the most are passengers of low-cost airlines or passengers on older fleets. If these aircraft don’t have a seat-back or overhead IFE system, the addition of a wireless IFE system could provide passengers on those aircraft with an entertainment system through their tablet computer, laptop or smartphone, significantly improving their travel experience. It would be a cheap and low-cost addition for the airlines as well, say those who follow the technology.

The Federal Aviation Association does not at present allow the use of personal electronic devices like smartphones, iPads or electronic readers such as Kindles on planes during taxing, take-off or landing, citing concerns they might interfere with a jet’s avionics systems. But that may be changing.

Personal Devices Allowed During Flights?

Laura J. Brown, deputy assistant administrator for public affairs for the F.A.A.,told the New York Times recently that the agency has decided to take a “fresh look” at the use of personal electronics and figure out how to test them for safety. Clearly, any IFE will need to comply with all relevant safety rules when in use, whatever they might be at the time.

One factor hard to pin down is what the cost will be to passengers to use such wireless systems. “This is a difficult question to answer as the cost will likely vary by carrier, route, passenger class and flight duration,” Hayfield told Currently, the service Gogo costs $12.95 for a 24-hour pass, or $39.95 for a month on in-flight Internet access.

Business travelers already expect to receive free Internet access where it’s available, and would likely expect to receive free wireless IFE too, he said. For leisure travelers, paying for wireless IFE may well be a popular addition on flights where there isn’t an entertainment system or the entertainment system is overhead with limited choice.

Many airlines already rent out personal electronic devices (PEDs) pre-loaded with a selection of movies or TV shows. On Alaska Airlines [ALK  34.26    0.44 (+1.3%)   ] , for instance, it costs between $6 and $14, depending on whether the device is reserved ahead of time and the length of the flight. Hawaiian Airlines [HA  5.15    0.13  (+2.59%)   ] offers a similar service.

Henry H. Harteveldt, a travel industry analyst at Atmosphere Research Group, says that streaming IFE content is an approach that makes sense for airlines. Atmosphere’s fourth quarter study in 2011 of 2,670 airline travelers in the United States showed that 83 percent have a laptop, 27 percent have tablet devices like iPads and that 59 percent have a smartphone.

“They bring these devices, especially tablets and smartphones, with them on most trips,” Harteveldt said. “A critical mass of travelers have the capability to take advantage of streaming entertainment. Plus, passengers who don’t have these devices, especially tablets, show strong intentions to buy one, which will only increase the potential audience for this product. Airlines have tested renting or loaning out iPads, Samsung Galaxy tablets, and Google[GOOG  604.19    6.59  (+1.1%)   ] laptops to travelers, which allows travelers who don’t have these devices to take advantage of the entertainment.

“The challenge will be whether travelers will pay for this,” he added. “Airlines will need to be able to separate the connectivity needed to access the plane’s IFE system from that needed to connect to Wi-Fi, which would allow the traveler to send e-mail, for example. I disagree with the assertion that business travelers expect in-flight Wi-Fi to be free, but I agree with the point that those in a premium cabin expect entertainment to be complimentary. Airlines will face some logistical challenges on how they offer the entertainment. I suspect that premium cabin travelers will be given a code to enter so that their entertainment is free.”

IMS Research is currently producing a passenger survey that will attempt to answer questions on how much passengers would be willing to pay for WiFi, video streaming, gaming and other such options, Hayfield said.

He thinks passengers will welcome the improvement. “Until very recently, we have all been cut-off from the outside world when flying, dependent on a limited program of entertainment, or reliant upon our own media,” he says. “But very soon we will all be able to access not only online content, but be able to communicate with family, friends and colleagues (and) keep tabs on ongoing travel plans.”

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United Said to Talk Exclusively With Boeing on 200 Jets

United Said to Talk Exclusively With Boeing on 200 Jets

United Said to Discuss Buying 200 Boeing Jets

United Continental Holdings Inc. (UAL) is negotiating only with Boeing Co. (BA) for an order of about 200 narrow-body jets after dropping discussions with Airbus SAS (EAD), two people familiar with the matter said.

Talks had been under way for at least six months about a mix of current-generation Boeing 737s or Airbus A320s plus variants with new, more-efficient engines, said the people, who declined to be identified because details aren’t public.

A Boeing Next Generation 737 jet sits on an assembly line at Boeing’s manufacturing facility in Renton, Washington. An order for 200 737s would have a list price of about $16.9 billion. Photographer: Kevin P. Casey/Bloomberg

A United deal would cement ties to a longtime customer and build on Boeing’s victory over Airbus in winning a 100-plane purchase from Delta Air Lines Inc. (DAL) in August. Airbus and Boeing, split a 460-jet order with AMR Corp. (AAMRQ)’s American Airlines in July. The list value for 200 737s would be about $16.9 billion, based on the $84.4 million retail price of the 737-800.

“If United goes with Boeing for this order we see this as a helpful market-share gain,” Robert Stallard, an RBC Capital Markets analyst in New York, said in a note to clients. He has an outperform rating on Boeing, which like United is based in Chicago.

Spokesmen for United, Boeing and Toulouse, France-based Airbus all declined to comment about the status of the latest negotiations.

Boeing slid 0.9 percent to $72.86 at the close in New York as U.S. stocks slumped, while United, the world’s largest airline, fell 0.3 percent to $22.85. Airbus parent European Aeronautic, Defence & Space Co. dropped 4.4 percent to 29.25 euros earlier in Paris.

Aircraft Options

Some of the planes in the 200-jet total may be options for future aircraft, said the people. The value of the order may rise once United settles on terms, because the 737-800 is less expensive than the so-called MAX model with upgraded engines. Airlines typically buy at a discount.

An all-Boeing order would also benefit CFM International, the General Electric Co (GE).-Safran SA (SAF) venture that makes the only engines used on the 737. CFM competes with United Technologies Corp. (UTX)’s Pratt & Whitney unit on the A320neo model.

The 737 is the world’s most widely flown airliner, and Boeing planes account for more than three-fourths of the main fleet of 701 jets at United Continental, which was formed in the 2010 merger between UAL Corp. and Continental Airlines Inc.

Continental had an exclusive relationship with Boeing dating back two decades. The new United is run by Jeff Smisek, who joined Continental in 1995 and was chief executive officer during the merger talks. United’s fleet management group is overseen by Gerry Laderman, senior vice president of finance and treasurer, who joined Continental in 1988.

“It will be a nice win for Boeing and GE,” Jeff Sprague, co-founder of Stamford, Connecticut-based Vertical Research Partners, said in a telephone interview. “Although the new company is called United, it’s really being run by Continental management and they’ve always been a Boeing carrier. It was probably natural for them to go toward Boeing and CFM for fleet commonality.”

Boeing is trying to reclaim the top spot in commercial production lost to Airbus in 2003. Airbus had record orders of 1,419 aircraft last year, while Boeing’s tally was 805. Airbus has said 2012 orders may fall by half as an initial flurry of purchases of its A320neo wanes.

United is refreshing a single-aisle fleet that includes Boeing 757-200s, with an average age of 18.2 years, and 737-500s that average 16.6 years old. Boeing no longer makes either model.

Before the merger creating the new airline, UAL’s United agreed in December 2009 to split an order for 50 wide-body jets between Boeing and Airbus. That deal was for 25 Boeing 787 Dreamliners and the same number of Airbus A350s.

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‘Dream Suite’ Indeed: All About Virgin Atlantic’s Updated Upper Class

‘Dream Suite’ Indeed: All About Virgin Atlantic’s Updated Upper Class

Hold up a moment while we hyperventilate. Virgin Atlantic just announced the details (and photos!) of their revamped Upper Class.

It feels like we’ve been waiting forever for the news—any news— on the new seats, but it’s actually only been since February that Virgin teased that the Upper Class was about to get a spruce-up. And they’ve managed to keep it all top secret…until now.

If you’ve ever flown Virgin Atlantic’s Upper Class, then you’ll spot the similarities and major changes right away. If you haven’t…well then, that just has to be fixed. Here are the major updates brought to the new Upper Class:

Not new: The herringbone layout that sees an arrangement of 1-2-1, all seats having aisle access.
New: An opaque window built into the divider between seats, so you don’t feel too closed off. Wider seats (1.5″ wider) with more recline (50% more, though they still go lie-flat too), and the longest business class bed of any airline, at a crazy 7′ 2″). We guess we know what will be the airline of choice for basketball players hopping the pond.

Not new: Individual entertainment systems with movies, tv shows and games.
New: Much larger TV screens (12.1 inches), controlled both by touch and with touchscreen remote controls. You’ll also be able to connect your phone, USB stick or tablet to “watch, read or listen to your own content, plus charge your device.”

Not new: Access to Virgin Atlantic Clubhouses at select airports, and the in-flight Upper Class bar.
New: A totally new JFK Clubhouse right near the gates, and a redesigned onboard bar (more on this to come).

Not new: The abundance of Virgin’s signature colors: purple and red.
New: That purple and red used in a new mood lighting system, and even in Swarovski crystal detailing around the onboard bar.

Not new: Full, course-by-course meals using real china, silverware and glassware.
New: Totally redesigned modern place settings and champagne glasses, plus the introduction of a proper afternoon tea set if you’re on an afternoon flight.

To virtually tour the new cabin, Virgin Atlantic even has a dedicated microsite called Planeview.

Believe it or not, the new Upper Class suites are already flying the Virgin skies on flights VS004 and VS003 between New York and London (excluding Fridays). Those would be A330s, though the future definitely holds Virgin Atlantic 787s with these new seats. *Bites lip with excitement*

We priced out a roundtrip VS flight in Upper Class for JFK-LHR in May, on the VS003 and VS004 routes, and seats are starting from $5,773. We didn’t say it was cheap; it is named “Upper Class,” after all.



The old Upper Class seat, for comparison’s sake 

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Virgin Australia A330 revamp

Big inflight entertainment screens feature in Virgin A330 revamp

VIRGIN Australia will intensify its bid to lure lucrative corporate domestic customers from May 15 when it launches a striking new custom-designed business cabin on its wide body trans-continental and Melbourne-Sydney services.

The airline will takes delivery of two new aircraft this month and a third later in the year to give it five of the six A330s it has planned for its fleet.

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Virgin America CEO talks about web site meltdown, Wi-Fi, Inflight entertainment…

Virgin America CEO talks about web site meltdown, Wi-Fi, Inflight entertainment…

Our recent experience on Virgin America’s inaugural Los Angeles-Philadelphiaservice wasn’t just about schmoozing with celebs, downing free cocktails and playing It’s Always Sunny in Philadelphia trivia.

Somewhere around Kansas, we sat down with Virgin America President and CEO David Cush to chat about the airline’s recent website meltdown, their reputation for raucous route launches and how many people really use in-flight WiFi.

NYCAviation: How’s this flight going so far compared to previous city launches?
David Cush: It’s pretty quiet so far. I think that’s because the flight left so early, but for example, the Fort Lauderdale launch we did out of LA, also was early, an 8 AM departure, but by 10 AM people were doing tequila shots in the back galley. So this one will probably get crankin’ up pretty good here soon.

Before it gets too nuts in here, let’s talk about your airline. Do you have any further expansion plans out of Philadelphia or the east coast in general?
Well, this is a pretty big commitment from day one, you know. Five flights, all long-hauls, so we’re gonna wait and see how this does. I think addtiononal flights would likely be a third from San Francisco, but that’s well down the line.

Our focus beyond this will be, in all honesty, an airport just down the road at Reagan National where they’re going to open up some slots and we want to fly into there also.

Longer term, Virgin America will be taking delivery of about 60 additional planes over the next several years, at which point you’ll have over 100. Where are they all going to go?
Most of them will come out of San Francisco and LA, those are really our focus markets. But I think once we get those built out, which is probably another 20 to 30 airplanes, we’ll be a little bit more opportunistic. We’ll see markets that are underserved who will like this product, which is really a long-haul product, then we’ll jump in. But no real plans beyond San Francisco and LA right now.

Any idea what the wifi usage rate is on Virgin America compared to other carriers?
We’re certainly higher than other guys. On a system average we’re in the low- to mid-20s. However, that varies widely by flight. If you look at our San Francisco-Boston, which is our highest penetration flight, we generally are over 50 percent on that flight. Same thing on San Francisco-JFK.

And it’s becoming a little bit of a problem. The network is slowed down. This is now an expectation of business travelers. With US Airways announcing last week they’ll be putting wifi on their planes it’s becoming more difficult.

We will be the launch customer for the new Gogo antenna, which will be a multi-directional antenna that can point to the most underused cell. We hope we can get that on an airplane this summer and test it out. But our plan is, if it does what they say it will do, which is four-times the speed that we currently have, then we’ll put it on all the airplanes.

Regarding the IT problems Virgin America has experienced over the past couple of months. Are those solved?
Are they solved? I would say yes they are. Our call center times are back down to normal. That’s usually your best indication, when people aren’t calling anymore. We’re answering 80 percent of our calls in under 40 seconds, which is our target. We don’t receive the complaints we were receiving on the website.

We have a lot of monitoring tools. We’ve used Omniture quite a bit, in terms of people dropping off the site. We used Tealeaf, which gives us an idea of sessions that are aborted and why they’re aborted. So we have a pretty good idea that things are working well, and now we’re focused on enhancements, which is really what this was all about.

We went in knowing it was going to be rocky. We had a significant transition because we were also going from ticketless to e-ticketing, and that’s a very complicated process of redoing all those records. That’s something United didn’t have to deal with. We also had a very unstable website already, but it was an unstable website that was used to its platform.

So we kind of knew what we were getting into. But my biggest concern, and the reason I rushed the implementation was our old system was also highly unstable. We went for three days in May of 2011 with the system being down. We can do that when we have 28 airplanes, which we did back then. Now we have 50 airplanes: It would basically drown the airline.

What have you learned from those issues?
The one thing I learned from it more than anything else, that I think I would do differently, and I think that United would probably do differently, and that I would counsel anyone who’s getting ready to go through this process, is go ahead and estimate the number of reservations call center agents that you think you’re going to need for the transition and then double it. That is where all problems end up falling, at the call center doorstep. That’s where people’s frustrations are the highest, is if they can’t get something done on the web, and then they can’t get through to the call center.

Our friends at Virgin Australia are getting ready to go through a transition later this year, also to Sabre, and that’s been my counsel to them. Go out and find as many Sabre call center support agents as you can, even if it’s third-party, and even if it’s for six months.

Answer the phones and most of your problems will go away.

Thanks so much, David.

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Where will Rob Fyfe End Up?

Where will Rob Fyfe End Up?

As two high profile CEOs get set to exit their multimillion dollar seats, there’s speculation about what they’ll do next.

Telecom has today announced Simon Moutter will take over from Paul Reynolds while Air New Zealand CEO Rob Fyfe will also depart later this year, his successor hasn’t been chosen yet.

Business commentator Rod Oram thinks Paul Reynolds would be a top candidate for an major overseas telecommunications company.

“Particularly where companies are dealing with very big government change or regulatory change,” he says.

Mr Oram picks Rob Fyfe may move to a leadership role outside the airline industry.

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Richard Branson: How To Succeed In Business By Really Trying

Richard Branson: How To Succeed In Business By Really Trying


Richard Branson: How To Succeed In Business By Really Trying

Suffering Philadelphian air travelers: help is on the way!

I was cheered to hear last week from CEORichard Branson that Virgin America is starting flights into Philadelphia. In May 2011, I described here the horrors of US Airways and its Philadelphia hub. Last week, on CNBC’s SquawkBox, on the introduction of the new service, Branson offered pointed insights as to why US airlines are doing so miserably as well as making us miserable. He gave five suggestions as to how things need to improve.

1. Increase quality of service

Branson said he had set up Virgin America to increase the quality of air travel for poor Americans who have suffered for many, many years domestically. Virgin America, he said, was opening a lot of new routes around America. Philadelphia has almost no competition between Philadelphia and Los Angelesand Philadelphia and San Francisco. He said that Virgin would give US Airways “a run for their money.”

2. Offer quality equipment

Branson said, “US Airways doesn’t have any plugs for plugging in your equipment, no entertainment system. But with Virgin America, we have the kind of airline that people from Philadelphia and the West Coast enjoy to fly and I think we’ll do well on this route.”

3. Don’t nickle and dime your customers

As CNBC host Becky Quick notedrecently air travelers in the US have been getting nickeled and dimed for everything. One airline is even proposing to charge people $35 if they want to bring any carry-on luggage with them to store in the overhead compartments. Branson agreed: “Virgin likes to come in to businesses where people are being nickeled and dimed and where the quality of services is pretty dire. What’s happened in America is you have got these enormous airlines that are getting bigger and bigger and, now, the last thing they seem to think about is quality of service. In every other industry in America—hotels, restaurants, clubs, et cetera—quality is of paramount importance. However on a competitive basis, the airlines play into our hands, the more they make decisions like this which the public dislike.”

4.      Allow actual competition

Consolidation of airlines in the US has made the airlines stronger but prices have also gone up. In fact, Virgin made its name going up against a virtual monopoly: British Airways. Branson said, “Consolidation is not good for the consumer and it’s incredible that the competition authorities keep allowing it to happen. In Britain, in their wisdom, the Comptition Authoriy has just allowed British Airways to take over British Midland. You wonder how they got the title, “Competition Authority”. A competition authority should be telling airlines to compete and if you don’t compete successfully to go away so you can make room for new up and coming companies with better ideas. You shouldn’t be able to be propped up by getting together with an even bigger carrier and then being able to monopolize and put fares up because you have no competition. It’s madness in what’s happening in the airline industry in the last five years.”

5.      No resurrection: let dead airlines actually die

Branson continued: “You also have this bizarre thing in America where if a company goes bust, it doesn’t actually go bust: it goes into Chapter 11. It screws its competitors by screwing its creditors, comes back out of Chapter 11 and then most likely goes back into Chapter 11 again few years later. Continental has been in chapter 11 four or five times. There’s not one carrier in America that we competed with over the last 25 years that hasn’t gone bust, at least once. Generally four or five times.”

Not unique to the airline industry

These problems are obviously not unique to the airline industry. I have described elsewhere how they play out in other sectors including:

In effect, we are not dealing with an airlines problem. We are confronted with an economy-wide management problem. Organizations are not sufficiently agile to cope with the demands of today’s emerging Creative Economy. The Fortune 500 must master the radically different management principles needed for continuous innovation that delights customers, with a different role for the managers, a different way of coordinating work, a different set of values and a different way of communicating. This is not rocket science. It goes by different names: “management 2.0″, “customer capitalism” or “Agile managment.” I have called radical management. Whatever we want to call it, as Richard Branson explains, it’s very different from traditional management.

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