Re-Heat
18th Apr 2005, 16:11
Thought this might be of interest to some - it just goes to show that you can't always milk cash from areas in which you don't have the know-how.
From FT.com:
Ryanair drops paid-for service
By Kevin Done, Aerospace Correspondent
Published: April 18 2005 03:00 | Last updated: April 18 2005 03:00
Ryanair, the Irish low cost airline, has abandoned its experiment in paid-for inflight entertainment, after a disappointing response from passengers.
At the same time it is intensifying the low cost airline battle in Germany with plans to open a second German base in Lübeck to the north-east of Hamburg in addition to its present base at Frankfurt-Hahn.
EasyJet, Ryanair’s main rival, has already opened two German bases at Berlin-Schönefeld and Dortmund airports, while German low cost rivals are also expanding rapidly.
The inflight entertainment trial using handheld devices the size of a portable DVD player, to show movies, cartoons, sports and music videos, was launched on a trial basis last November.
It has been followed with intense interest by other airlines, in particular in the low cost sector. Similar trials are currently under way in the UK at both EasyJet and BMI British Midland.
When he launched the experiment Michael O’Leary, Ryanair chief executive, billed the move as “the next revolution in the low fare airline industry...We expect to make enormous sums of money. We wouldn’t do it, if we didn’t think it had huge revenue potential.”
The airline charged £5 or €7 a flight for the service, which was launched initially on five aircraft flying out of the airline’s main base at London Stansted airport, and it hoped originally to have its whole fleet of more than 90 aircraft equipped by last month.
Instead a Ryanair spokesman said the service was “being withdrawn because of lack of interest from passengers.”
The airline had planned to take delivery of 6,000 of the so-called digEplayer devices over five years from a US company APS, based in Tacoma, Washington State.
With an average spend of only 50 cents per passenger Mr O’Leary expected to generate €14m of additional revenues a year to boost the airline’s ancillary earnings and to offset the expected continuing decline in average fare levels.
Instead a Ryanair spokesman said the airline believed that inflight gambling could now have great potential for generating extra revenues, although there still had to be some technological advances, before it could proceed. The introduction of scratchcards had already proved “a phenomenal success.”
Web Barth, marketing director of APS, said that the flights on which Ryanair had been offering the inflight entertainment devices had been too short. “The ideal is six-hour flights to holiday destinations. Short flights or morning and business flights are problematic.”
Potentially Ryanair was going to be APS’s biggest customer, but Mr Barth said the digEplayers had proved successful at several other airlines including Alaska Airlines and KLM.
EasyJet said its two-month trial of similar devices, which was being run out of Newcastle and Nottingham East Midlands airports chiefly on longer routes to southern Spain, was due to finish at the end of April.
A spokesman said that demand was not a problem, but a key issue was the cost of buying in the content especially current release blockbuster movies, which the studios were now charging for on a per passenger basis rather than on a flat rate per month.
From FT.com:
Ryanair drops paid-for service
By Kevin Done, Aerospace Correspondent
Published: April 18 2005 03:00 | Last updated: April 18 2005 03:00
Ryanair, the Irish low cost airline, has abandoned its experiment in paid-for inflight entertainment, after a disappointing response from passengers.
At the same time it is intensifying the low cost airline battle in Germany with plans to open a second German base in Lübeck to the north-east of Hamburg in addition to its present base at Frankfurt-Hahn.
EasyJet, Ryanair’s main rival, has already opened two German bases at Berlin-Schönefeld and Dortmund airports, while German low cost rivals are also expanding rapidly.
The inflight entertainment trial using handheld devices the size of a portable DVD player, to show movies, cartoons, sports and music videos, was launched on a trial basis last November.
It has been followed with intense interest by other airlines, in particular in the low cost sector. Similar trials are currently under way in the UK at both EasyJet and BMI British Midland.
When he launched the experiment Michael O’Leary, Ryanair chief executive, billed the move as “the next revolution in the low fare airline industry...We expect to make enormous sums of money. We wouldn’t do it, if we didn’t think it had huge revenue potential.”
The airline charged £5 or €7 a flight for the service, which was launched initially on five aircraft flying out of the airline’s main base at London Stansted airport, and it hoped originally to have its whole fleet of more than 90 aircraft equipped by last month.
Instead a Ryanair spokesman said the service was “being withdrawn because of lack of interest from passengers.”
The airline had planned to take delivery of 6,000 of the so-called digEplayer devices over five years from a US company APS, based in Tacoma, Washington State.
With an average spend of only 50 cents per passenger Mr O’Leary expected to generate €14m of additional revenues a year to boost the airline’s ancillary earnings and to offset the expected continuing decline in average fare levels.
Instead a Ryanair spokesman said the airline believed that inflight gambling could now have great potential for generating extra revenues, although there still had to be some technological advances, before it could proceed. The introduction of scratchcards had already proved “a phenomenal success.”
Web Barth, marketing director of APS, said that the flights on which Ryanair had been offering the inflight entertainment devices had been too short. “The ideal is six-hour flights to holiday destinations. Short flights or morning and business flights are problematic.”
Potentially Ryanair was going to be APS’s biggest customer, but Mr Barth said the digEplayers had proved successful at several other airlines including Alaska Airlines and KLM.
EasyJet said its two-month trial of similar devices, which was being run out of Newcastle and Nottingham East Midlands airports chiefly on longer routes to southern Spain, was due to finish at the end of April.
A spokesman said that demand was not a problem, but a key issue was the cost of buying in the content especially current release blockbuster movies, which the studios were now charging for on a per passenger basis rather than on a flat rate per month.