Free Internet is a Must: El Al’s Tal Kalderon Talks IFC as Airlines Look to Rebound

El Al Airlines is the national airline of Israel, and has been running strong since 1948. But with the COVID-19 pandemic affecting every corner of the world, the airline — like many others — has had to ground flights and change its way of operating. Many airlines have considered moving to a free In-Flight Connectivity (IFC) model during this time, as well as changed their plans for implementing new technologies.

Yet during this time, the satellite industry has seen a few big deals in the IFC space including Intelsat acquiring GoGo’s Commercial Aviation business, and Inmarsat working with Hughes on a Wi-Fi collaboration.

Via Satellite sat down with Tal Kalderon, El Al Airlines’ head of In-Flight Entertainment and Connectivity, to discuss the challenges of the COVID-19 pandemic, the company’s current IFC model, and where El Al plans to move next.

VIA SATELLITE: How has the COVID-19 pandemic affected El Al Airlines?

Kalderon: El Al was locked down and grounded almost throughout [all of] the COVID period, except for a few cargo flights. Just in the recent weeks, we have started to fly again to a few destinations, dependent on the health situation in those countries. And actually, just [recently] we announced the opening of a new flight route to Dubai. But at the moment, the airlines and the airport in Israel are prepared for safe flights, both in the preparation of the crews on the flights and with COVID-19 checkpoints at the airport. On the economic side, El Al has a new shareholder who has brought the airline additional investment. And we hope that if the vaccine is developed and distributed soon, we'll begin to feel the recovery in the aviation and tourism sector.

VIA SATELLITE: Are there any specific safety measures for passengers on board that El Al has implemented in response to COVID-19?

Kalderon: Like with most airlines, the passenger must wear a mask on the flight. They must also take a COVID-19 test at least 72 hours before the flight. And it if everything is okay, and they are healthy, they can fly with us.

VIA SATELLITE: A lot of providers have talked about using a free model for Wi-Fi, especially during this pandemic. What business model does El Al use?

Kalderon: Like many airlines, we're charging for internet use on El Al flights, but, I believe, not for long. I'm a great believer in free internet on board. And I think airlines are also starting to conclude that what happens on the ground will happen in the air. Nowadays, the internet in hotels and restaurants is free. And airlines understand that they will have to find another way to put the funding for internet activities on flights — and not at the expense of the passenger. I'm working on a new model and I believe we'll implement it quite soon.

VIA SATELLITE: What does the next generation of IFC services look like for El Al? Are you transitioning to the free model?

Kalderon: Yes. In my opinion, the ideal would be a free internet that allows the passenger to access their personal accounts on sites such as Netflix, Amazon, and Spotify. This way, the passenger will get their favorite content from huge libraries that we, as an airline, can never compete with. This situation requires technological improvements, mainly in the field of bandwidth and geographical coverage of satellites. As far as I know, internet service providers are already working on it. I assume that in the next year or two, there will be a significant improvement in the connectivity technology on board. Once passengers are able to browse and use streaming sites, it will allow airlines to invest less in getting and buying content rights, and invest more in technology to enrich the passenger experience. I also think it is better to allow passengers to browse and get the content to the seatback screen in front of them, and not to their personal device.

VIA SATELLITE: When people get back to flying, how realistic is free Wi-Fi? Will this be the overall standard?

Kalderon: I really hope so. We will have to be very creative in order to find ways to finance free internet. In today's situation, it will be very difficult for the airline to absorb the entire cost. But on the other hand, when the internet is free, the user take-up rate is much higher. When the take-up rate is high, it will be easier to get the advertisers or sponsors or corporations to fund the intended use.

VIA SATELLITE: How much has El Al had to scale back flights? With less flights, have you had to scale back your connectivity plans?

Kalderon: As I mentioned at the beginning, planes were grounded most of the time, and there were no flights. So, we had to disable the data service. And now that the flights are back, we will return the service.

VIA SATELLITE: What have your passenger numbers been like?

Kalderon: The passengers are still afraid, so only those who really need to fly, and the brave ones, are flying. This reduced the number of passengers. But when we start the vaccination process, we will begin to see improvement.

VIA SATELLITE: Are there any new technologies the airline is looking into, and do you see any competitive offerings coming into your arena?

Kalderon: What I'm looking for today is a significant improvement in bandwidth that will allow a large number of passengers to use high quality video, and at the same time, satellite coverage over all of our flight routes. Those are the main things that will allow us to approach the next step of building passenger access to streaming sites. The technological challenges are huge, and it is important to do it smartly, with a long-term vision that will enable the creation of a platform that significantly upgrades the customer experience. At the same time, it becomes a source of revenue and profit for the airlines.

VIA SATELLITE: What do you think of the Intelsat/Gogo business combination? Is vertical integration good for airlines?

Kalderon: I think such activities have been planned for a long time, and COVID-19 only accelerated the move. Beyond the economic move, it seems that there is significant technological improvement here. Reducing the number of service providers may outweigh the competition, and this may be reflected in the price the airlines will pay at the end.

VIA SATELLITE: How do you feel about the Inmarsat/Hughes deal? How does this affect the market overall?

Kalderon: It also looks like a great technological improvement. But if the internet will be free, the demand and use will be particularly high, and all parties must be prepared for it. I think the airlines have realized that the passenger will not be able to settle for just text messages and emails — the passenger expects a full internet user experience, as experienced on the ground. The deployment of the ISP was predictable, which is great. And if that requires two leading companies in the fields to merge, I guess it's good for everyone. Firstly, for the companies themselves, then for the airlines, and most importantly, the passengers.

VIA SATELLITE: With a vaccine in the U.S. widely available in early to mid-2021, do you predict that ridership will be back up to normal during the next vacation season?

Kalderon: We could see throughout the period of the pandemic that the memory of most people was quite short. As soon as it was possible, everyone immediately went to restaurants, cafes, jobs, even to the airports. I am sure that once a big part of the population is vaccinated, people will fly again. If they start [vaccination] around February, we will feel a recovery towards Easter, and certainly towards summer vacation. But it’s just my optimism — it's not something that relies on scientific prediction. It's just my positive thinking.

VIA SATELLITE: In wrapping up the interview, do you have any final thoughts?

Kalderon: Many airlines and many of my colleagues are thinking the same way: that free internet is a must. And most airlines will have to find other ways to fund it. There are ways to sponsor it, but it's not easy, especially these days. But I believe that it will be a must. In a year or two years from now, I believe that the internet will be free on most airlines. VS