Delta Air Lines made huge headlines at the start of the year with the news that it will start offering free Wi-Fi on board its aircraft in partnership with T-Mobile. It was one of the headline stories to come out of CES this year. At the start of last month, Delta began to offer free Wi-Fi on more than 500 aircraft serving its most popular routes, with full availability across its global fleet planned by the end of 2024. The company has unveiled its plans to elevate the customer experience to the next level, with free Wi-Fi at the heart of this.
It was a major strategic move for the airline, which has long been a pioneer in the in-flight connectivity (IFC) arena, and it could lead to other airlines following suit.
However, the move to ‘free’ is a risk. It is not inexpensive to offer these services to passengers and making IFC a success has proved far from easy for airlines over the last few years. Given Delta’s status as one of the world’s biggest airlines, it makes for interesting news for the satellite sector. If others follow Delta’s lead, there could be a spike in demand for satellite capacity.
In an exclusive interview, Ekrem Dimbiloglu, Delta’s managing director of In-Flight Entertainment and Connectivity talks to Via Satellite about the move to free, the company’s demands for satellite capacity, and how Delta is looking to evolve the customer service experience.
VIA SATELLITE: Why was the timing right to offer free Wi-Fi? It is a very bold, brave decision. What do you see as the key benefits for moving in this direction?
Dimbiloglu: This is something we have been working on for quite some time. If you think about the pre-COVID period and where Delta was and where the industry was, we were talking about how we could offer Wi-Fi for customers free of charge, and offer it as a product and make it available to anyone who is on board the aircraft. With COVID, there was a thought that maybe this work would slow down and we would pull back from improving the customer experience. In fact, quite the opposite happened. During the last several years, we have accelerated the work necessary to transform the airline and transform the experience for all the customers that fly us. It was at the right time, as we were at the right place. We had made the right investments. We had done the appropriate testing. We worked hard to fit the right technology to the right aircraft to deliver the right experience that our customers expect. 2023 was the right time because of the progress of the project, but also it was the right time because of where the industry is, and where we all are. We all now want to explore the world and stay connected. If you think about the work we have done on the Wi-Fi front in particular, it is really about bringing that connection and ensuring no matter where you are on the ground, or in the air, you can still stay connected to your loved ones and your family and friends.
VIA SATELLITE: Has cracking this market been harder than you anticipated? It seems that years later, no one airline has really been hugely successful with their connectivity strategy. Why has it proved so difficult?
Dimbiloglu: We have been very focused on this space for quite some time. I think technology has evolved. If you think about the space we operate in, Wi-Fi in particular, we have been on a journey at Delta to transform this experience. As we think of where customers use has been, and where the appetite has been to consume content, it has changed vastly over the last 10+ years. When you think about us offering free messaging, we had the ATG [air-to-ground] system, then we had the Ku/Ka-band. Airlines like Delta have had to evolve with that and continually update our strategy so that we are meeting and exceeding the expectations of our customers. I think we are now getting to that point where we can have reliable systems that offer the connectivity that customers need and want.
As we were designing the customer experience, it was really important to us that we weren't designing a customer experience for today only, but we were building something for the future. We know that customer needs, desires and consumption habits are going to change. It was critically important that as we were going through the selection process, that we could find a partner and a technology that could evolve with us and meet those expectations. We needed to make sure the companies we partnered with had a strong roadmap and had the capacity we needed to get that experience. That was really important to us in order to meet expectations. We don’t want to be at a point where we don’t have the capacity to meet the needs our customers now expect.
VIA SATELLITE: What is the demand going to be like in two to three years’ time?
Dimbiloglu: Capacity without a doubt is going to increase as time goes on. We will have more customers connected. We know from historical analysis that content consumption always goes up in terms of the types of sites the consumers go to, and the type of bandwidth required for them to be displayed in a way that customers expect. So, no doubt about that, there will be an increased need. You need to partner with companies that have a robust roadmap, that can make sure we can hold onto that. We need to have the right plans to address that.
VIA SATELLITE: Speaking of satellite, LEO is now a very real option. Starlink is now signing deals with commercial airlines. OneWeb may not be far behind either. Do you think they will really shake up the market here?
Dimbiloglu: We are constantly evaluating all technologies. And while we have done a test with Starlink, our biggest focus is about providing the right technology to the right plane at the right time. We are focused on delivering a great experience and part of that is understanding the marketplace and who the players are in the marketplace. We are watching everything very, very closely.
VIA SATELLITE: We have seen Intelsat acquire Gogo. Viasat and Inmarsat are on the cusp of their merger too. Is this overall, good or bad for the IFC market, given there are going to be less options to customers like Delta?
Dimbiloglu: As you think about where the market is today, for sure, competition is a benefit not only for airlines, but for the customer as well. My primary focus is offering a great experience to our customers and making sure the companies we partner with are world class and have their own world class roadmaps to make sure we can grow together. Competition breeds innovation.
VIA SATELLITE: Beyond providing entertainment services and content, what other ideas/concepts do you think will really resonate with customers when we talk about the overall experience?
Dimbiloglu: The opportunity is in providing new entertainment and new ways for customers to stay engaged onboard. This is not only with the brand, but with their journey, but also open their mind to new ideas that they may not think about when they are on the ground. We are focused on listening to customers and gaining feedback directly from them, and what they want to see and evolving the experience based on what we hear. For example, if you fly on a Delta plane today, you can take the survey on the free Wi-Fi service — we look at that on an almost weekly basis.
One area of focus in the coming months is on the premium brand partnerships we are building into the experience. One thing I am proud about is creating these brand partnerships and ecosystems that are truly valuable to customers. So, thinking historically, what we have done with the music experience on the seatback screens, bringing high-end education content onboard and what we will do in the coming months with exclusive streaming content and gaming that you would typically pay for — we have a lot of ideas on how we can bring brands into the Delta experience in a way that is seamless and delivers on our premium product vision.
VIA SATELLITE: Have you seen any new trends in terms of how customers are using connectivity as we are in this new normal?
Dimbiloglu: Customer trends, habits, preferences, and desires are constantly changing. I think what we have seen since the pandemic, and even just before that, there has been this shift towards staying connected, and staying connected to loved ones, and those moments that matter. We have all seen the fragility of life and the importance of staying connected to the ones we love which makes staying connected to people on the ground all the more important. Secondly, we see consumption toward streaming and video content that is really transforming how we use the internet.
If you think about where Facebook or Instagram is today, there is much more video content than three to four years ago. And we anticipate that this will continue to grow over time. At the same token, there are also things that we know will stay static. For example, there are people that we know need to stay connected to their work, answer their emails and stay connected to their colleagues on the ground. It’s important we deliver an experience that meets the needs of those customers as well. Ultimately, we need to mimic the service you have on the ground so customers feel like they are getting a great experience in the air.
VIA SATELLITE: You are going for free, yet to offer a service like this costs tens of millions of dollars. How do you justify it from a business model perspective doing this?
Dimbiloglu: Yes, it is costly, but it is done for the customer's benefit. We believe that by offering a premium high-quality service with partners that customers want to engage with, we will drive greater affinity and brand awareness to the Delta brand and bring customers in at higher numbers — free Wi-Fi is one part of that. The rationale is really what is best for our customers — what can we do to drive brand affinity and love to our brand?
VIA SATELLITE: Is connectivity and investing in connectivity more important than ever? What do you see as the big potential changes over the course of the decade as you evolve the customer experience?
Dimbiloglu: At Delta, connectivity opens a lot of different ways to improve the experience for customers. It is not only about providing free Wi-Fi — about allowing customers to stay connected with loved ones or stay connected with their work, or explore new things and new partnerships that we have. While this is really critical, it also unlocks a much more personalized experience when you are on board a plane in a variety of ways. For example, our upcoming product Delta Sync On Demand will enable us to connect our more than 145,000 seat back screens to Wi-Fi in new ways. That is going to open up a world of personalization opportunities. Being able to start a movie where you left off, tell us the content you like the most, interact with flight attendants and more — these are all things on our list to bring onboard soon. It will change how customers interact with the Delta brand and experience our product when they are on board.
VIA SATELLITE: While you are clearly motivated by what you are doing, do you think the fact that Delta has gone ‘free’ will lead to an industry wide momentum here, and others will follow?
Dimbiloglu: It is one I don’t spend a lot of time thinking about. We have so much going on with the upcoming launch of our Delta Sync Exclusive Hub is our focus. Where the industry goes, I don’t know. Time will tell. All I know is that this is where we need to be and where our customers want us and expect us to be. That is my focus.
VIA SATELLITE: Do you think the IFC market has entered a new phase?
Dimbiloglu: It is a hard question. It is always hard to say that if you are in the midst of a new phase. I think you need some time to step away from it to say if you were actually in a new phase. I do think the industry, at least from my perspective, has evolved. I think it has been a positive evolution for customers and it has been a positive evolution for airlines in terms of improving the technology and pushing the boundaries. That is good for all of us. The status quo in the airline and satellite business gets you nowhere. The moment you don’t push new ideas forward, it is the moment you can’t stay ahead. I do like the innovation we are seeing in the market right now. VS