Market research company In-Stat has published a new report on the up-take of in-flight internet users and the numbers are, well, interesting. The company is very bullish on the technology, suggesting that by 2015 it should cross the $1.5Bn annual revenue mark. The company also suggests that in-flight wifi is no longer "a competitive differentiator, it is now simply viewed in the US market as a competitive requirement."
The strange thing about this last claim, however, is that the number of folks actually using the service is still incredibly low. Yes, the take rate has increased from 4% to 7% year over year according to their stats. That is a reasonably significant jump percentage-wise. But it still isn’t a ton of users.
And, more significantly, it is hard to comprehend how a senior analyst at the research company can claim that a product used by such a small percentage of customers is anything close to a competitive requirement. There are 90%+ of the passengers who apparently do not care at all about in-flight wifi as they aren’t using it. It is also not clear from the teaser part of the report how many of the users were willing to pay for the service versus using it for free.
Yes, in-flight internet will eventually be a compelling product and it will be a competitive requirement for airlines. That day is coming. It just isn’t here yet, despite reports such as this one.
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