A pair of recent earnings reports left open questions about just how many aircraft are generating how much inflight connectivity revenue. Both Gogo and Inmarsat clarified those positions, providing better context around their numbers.
KLM
China Southern quits SkyTeam, seeks stronger partnerships
SkyTeam lost its largest mainland China airline this week. China Southern announced it will quit the alliance in 2019. The non-renewal of the membership contract will see the carrier transition out of its alliance relationships in the coming year. This is not a hard stop of relations; rather, the changes are likely to roll out over time. It is also not a surprise.
PaxEx Premium: Digging in to Global Connectivity Revenues
Gogo’s strong Q3 offset by global ARPA concerns
Gogo revised its expectations for 2020 and beyond, announcing updated goals as the company continues its drive towards profitability. Alas, details on those revised targets will not be shared with investors. CEO Oakleigh Thorne shared that the new math takes into account "more realistic expectations" of satellite costs and the shift to the airline-directed model. Assuming the new numbers are part of the Q3 '18 numbers they should help the company significantly, though there are indications some parts of the operation could revert to higher costs. The inability for global revenue to keep pace with growth in North America is also concerning given the company's current backlog.
PaxEx Premium: Another connectivity split fleet
KLM gives up control to win over customers
Long considered a leader and innovator in the digital landscape, KLM faces challenges as it seeks to hold on to that role. Giving up some control enables the company to gain consumer confidence and improve satisfaction. And, hopefully, convert those passengers into the truly loyal.
Joon crew want mainline rates, ignoring the entire reason for their existence
Benjamin Smith’s early days at Air France-KLM will be anything but easy. Union issues dog the company and the latest salvo from Joon flight attendants is a doozy!
Alitalia is out, Virgin Atlantic is in: TATL JV changes proposed
Alitalia’s struggles continue. The carrier still needs a fresh infusion of cash to pay off the bridge loan from the Italian government and some sort of long-term plan. And, for the latter, Alitalia will soon find itself forced to be more independent than it is today. Ouch.
KLM gets its 2Ku on, too
Nearly two years after the deal was announced the Gogo 2Ku hardware is beginning to show up on KLM aircraft. A pair of A330-300s now carry the kit. The service is not yet active for travelers, but that’s coming soon enough.
Finding détente in the airline-GDS cost battle: Air France/KLM and Amadeus make peace, progress
Peace is possible between the airlines and GDS platforms! Air France/KLM and Amedeus agreed to waive distribution fees in some cases, benefiting passengers in the near term. But it is the longer term plans around NDC content distribution that hold real potential for an improved passenger experience.