A year ago AERQ made a splash with its Welcome Board product on a Lufthansa 380 Flying Lab flight. Now the company, a joint venture of Lufthansa Technik and LG, is formally launching not just the Welcome Board, but a broader suite of inflight entertainment offerings. It aims to bring competition and innovation to the IFE and cabin digitalization markets.
We are the cool kid of two cool companies. The combination of LG and Lufthansa Technik bring together in a venture form a really good idea and a solid business. We are ramping up a team which can deliver on the vision of this partnership.– AERQ Managing Director Arnd Kikker
A full IFE platform, ready to compete
Initially the Welcome Board product will integrate with existing inflight entertainment systems. It is just another screen to be programmed on the network. But AERQ intends to go far beyond that. The company describes it as an open IT platform, with the ability to integrate content and concepts from partners into the passenger experience. And, more importantly, AERQ content will not only display on the Welcome Board. Nor is it limited to larger screens that may appear on monuments or the cabin ceiling.
AERQ intends to deliver a full-fledged IFE system for airlines. The company is currently answering RFIs/RFPs and working to bring this platform to life in flight. As AERQ Managing Director Arnd Kikker explains, “We are going to have our own IFE platform. But beyond that, the inflight entertainment part is really an application in the whole system, it’s not purely the the main focus. Once airlines have the full availability of the of the platform and control of the different touchpoints with the passengers, then you can think of various use cases.”
The initial iterations will operate as traditional embedded IFE systems while also offering streaming content options. Looking longer term, however, a wireless embedded solution is also on the road map for the company. AERQ notes that it must be coordinated with the inflight connectivity providers as running multiple WiFi networks on board is less than ideal.
Controlling the digital touchpoints
AERQ’s market strategy focuses on returning control of the inflight digital touchpoints to the airline. Jan-Peter Gaense, Head of Lufthansa Systems Passenger Experience Solutions and former MD at AERQ points out the significant disconnect airlines face when trying to manage the inflight entertainment system, particularly compared to their website, mobile app or other digital properties. “They can change an app whenever they want to, do whatever they want to the website. But on their most important touch point, the one on the aircraft, airlines hardly ever own anything. They are no longer in a position to change something quickly. There are always processes, hurdles, obstacles, intentionally or unintentionally thrown at you by the provider who owns the IFE system.”
Can AERQ truly remove those impediments? The company’s IFE model offers airlines full control with a package of documentation and SDKs delivered to the carrier’s internal teams for implementation and management. A managed services option also exists, for those airlines that might not be ready to fully take over control.
Kikker similarly calls attention to the ability for airlines to differentiate themselves in the skies, not through seats or meals but through this digital platform. He suggests a more dynamic IFE offering, varying even by route, could deliver an improved passenger experience and aid the airlines’ cause.
Concept or reality?
These products are not just concepts for AERQ. The company confirmed it is working towards a line-fit installation on Airbus aircraft for an Asian airline, currently scheduled for delivery in 2022. That implementation includes a family of screen sizes, at 27, 32 and 55 inches. The ability to launch with a factory-installed offering demonstrates some of the value the Lufthansa Technik side of the relationship brings to the venture in terms of the long-standing relationship with OEMs and technical capabilities in bringing complex systems on to airplanes.
At the same time, however, the broader open IT platform appears slightly less rigid in its structure. Kikker describes it more as a framework and developing on a “journey together with the airline” to come up with a solution that will fly. The timeline for that to deploy is a bit later, targeting the end of 2022 or early 2023.
Is anyone buying?
That the product will launch as a line-fit installation on a new cabin, rather than a retrofit, is an uncommon path to market. While AERQ is not complaining about that deal the reality of limited cabin retrofits in the coming years is also top of mind for the company. Kikker sees an opportunity with that, however. Noting that carriers will not have much money to buy new cabins on a larger scale in the coming years, he sees the Welcome Board option as an opportunity to “bring a bit of differentiation to new cabins without having a full retrofit.”
Moreover, Kikker suggests that airlines are struggling with their legacy providers today, with “no thought nor resources for for designing the future or innovating.” He sees a few years of limited investment from airlines, a period during which AERQ has “freedom to really design something new because we are investing purely in innovation.” And coming out the other end, when money is ready to be spent again, AERQ expects to have a compelling solution on offer, far different from the legacy platforms today.
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