If there was a definitive airline story in 2018 it was of disruption – but of quite the wrong kind, and 2019 is promising more of the same. Carriers and their passengers were at the mercy of gyrating oil prices, striking pilots at Air France, Virgin, Ryanair and elsewhere, pilot shortages, militant baggage handlers around the globe and extreme weather. On top of all of that, the major engine makers, Rolls-Royce, Pratt & Witney and GE and plane manufacturer Boeing all still have major product problems that have grounded planes.
The scale of the delays competed for the headlines and won, pushing down column reports on technical innovation. However, while it is no longer the stuff of ‘hot news’, digitalisation continues to force a shift in business models as airlines increasingly realise they can no longer focus solely on controlling their ticket sales and leave other businesses to capture the ancillary revenue. Yet, what is grabbing attention here is the speed at which Google and Uber are moving to offer to do a better job than the airlines in connecting passengers with the transport solutions they want.
As Forbes magazine points out, “Google Flights, a simple travel shopping app, is now starting to show baggage and other restrictions along with schedules and fares. It’s a safe bet that this functionality will improve before long to show the right combination for each customer — simplicity itself. Meanwhile, the airlines continue to layer on complexity.
“Less apparent to the consumer, this capability will enable Google to capture richer data about the demands of customers, based on what they search for and click on. For Google, this creates opportunities to sell more targeted advertising, which commands a higher price.”
A very different endeavour by Uber, albeit a ‘blue-sky one’ at this stage, is its white paper outlining possible plans to develop a network of on-demand, electric air taxis over congested cities like Los Angeles and Sao Paolo. “It’s not that farfetched,” adds Forbes. “Last year, Uber partnered with the European airline Transavia to offer UberESCAPE. For one week, customers were able to grab a flight on the app as easily as a car!”
Amazon is also moving in, although only to cargo handling at this stage, having committed $1.5bn toward building an air cargo hub at Cincinnati's airport.
18/12/19 Eye for Travel
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The scale of the delays competed for the headlines and won, pushing down column reports on technical innovation. However, while it is no longer the stuff of ‘hot news’, digitalisation continues to force a shift in business models as airlines increasingly realise they can no longer focus solely on controlling their ticket sales and leave other businesses to capture the ancillary revenue. Yet, what is grabbing attention here is the speed at which Google and Uber are moving to offer to do a better job than the airlines in connecting passengers with the transport solutions they want.
As Forbes magazine points out, “Google Flights, a simple travel shopping app, is now starting to show baggage and other restrictions along with schedules and fares. It’s a safe bet that this functionality will improve before long to show the right combination for each customer — simplicity itself. Meanwhile, the airlines continue to layer on complexity.
“Less apparent to the consumer, this capability will enable Google to capture richer data about the demands of customers, based on what they search for and click on. For Google, this creates opportunities to sell more targeted advertising, which commands a higher price.”
A very different endeavour by Uber, albeit a ‘blue-sky one’ at this stage, is its white paper outlining possible plans to develop a network of on-demand, electric air taxis over congested cities like Los Angeles and Sao Paolo. “It’s not that farfetched,” adds Forbes. “Last year, Uber partnered with the European airline Transavia to offer UberESCAPE. For one week, customers were able to grab a flight on the app as easily as a car!”
Amazon is also moving in, although only to cargo handling at this stage, having committed $1.5bn toward building an air cargo hub at Cincinnati's airport.
18/12/19 Eye for Travel
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