CES 2023: Delta To Launch Free Wifi And Streaming At Scale
Originally published by Forbes on Jan 5, 2023
Free in-flight wifi is not new. Today at CES in Las Vegas, CEO Ed Bastian announced a billion dollar plan to make it better.
Delta CEO Ed Bastian joins MediaLink CEO Michael Kassan on stage Jan. 5 in Las Vegas at CES 2023.
Courtesy: Delta Airlines
After years of false starts and technical difficulties, Delta Air Lines today announced the launch of “full, fast, and free” wifi for all SkyMiles members to become available on most domestic mainline flights beginning next month on February 1 — with plans for full availability to roll out on both international and regional aircraft by the end of 2024.
In 2019, when Gogo Inflight was Delta’s official internet provider, passengers had to pay for the privilege of a service that, more often than not, didn’t work. Though CEO Ed Bastian had shared his goals of providing free wifi at the time, he worried that “if we made it for free, the system would crash.”
Today, Bastian is sharing a much different message with a captive audience at CES, America’s largest annual tech conference:
“We’ve invested a billion dollars to do this. The only requirement is that you login via your SkyMiles account,” said Bastian from his seat on stage next to MediaLink CEO Michael Kassan at the Aria Resort and Casino. “No one better connects the world than Delta, no one better connects the sky, and this is the last frontier of connection that exists,” proclaimed Bastian, as the packed ballroom room erupted in applause.
This isn’t just about having wifi, it’s about what Delta can do with it. Today, the carrier also announced its planned spring launch of a new digital platform called the Delta Sync Exclusives Hub, in which Skymiles members can access free content that is typically behind a subscription-based paywall, including Paramount+ entertainment, New York Times Games, Atlas Obscura travel content, and Resy, a restaurant guide app owned by American Express.
The next-level move here is the ability to stream video on your personal devices. Up to this point, airlines haven’t invested in the satellite-based bandwidth necessary to support robust streaming. But with its new contract with ViaSat, Delta is attempting to make this possible.
A beta version of the Delta Sync Exclusives hub is coming this Spring. CHRIS PATEY VIA DELTA
To be clear, there are some limitations to this service. “We’re not going to be having telephone calls, FaceTimes or Zoom calls because we don’t believe that you should be sitting in a cabin on a plane listening to other people’s conversations. But, you’ll have streaming capabilities,” Bastian told Forbes in an exclusive interview preceding today’s event.
Given that streaming is the biggest consumer of bandwidth, offering it is a pretty big promise. Which begs the question: What kind of streaming services are we talking about?
“Two things relate to streaming: There’s what you find on the seat back screen, which is not streaming; it is stored [pre-loaded] on a server onboard the airplane. Then there’s the overall promise to allow you to stream video, whether that video is from Paramount, Youtube, Instagram, you name it – we want you to be able to stream video on your device. That’s our customer experience aspiration,” said Ranjan Goswami, S.V.P. of Customer Experience Design for Delta.
It’s all part of the company’s plan to personalize in-flight entertainment and build a new digital customer experience, or “CX platform,” that is as similar to your Smart TV at home as possible. We are, after all, creatures of habit. This partnership-based strategy is expected to bring many more Delta passengers into the membership fold.
Bastian disclosed that “roughly half” of the customers traveling on Delta today are registered in their Skymiles membership program. But about half are not. “There’s somewhere in the 20 to 30 million range of people who travel on Delta who are not members that we look to eventually enroll in the program,” he added.
The Billion Dollar Plan
If they pull this off, Delta will have the first-mover advantage among the largest U.S. carriers. Though free wifi in itself is nothing new — JetBlue began offering free Wi-Fi on its relatively smaller fleet in 2017 — the scope and scale of today’s announcement marks a major milestone in Delta’s quest for full connectivity.
The airline will offer the service on “more than 700” aircraft by the end of 2023, in partnership with T-Mobile and Viasat, Delta’s new satellite internet service provider. The carrier also plans to bring wifi on international and regional aircraft by the end of 2024, though it did not specify exactly how many airplanes that entails. (Delta’s full fleet, according to the company’s September 2022 10-Q statement, is made up of 1,242 mainline and regional aircraft, both owned and leased.)
Accomplishing hi-speed internet on planes is not as easy as you might think. The process requires a major investment of time and money to remove aircraft from revenue-generating service and retrofit planes with the necessary hardware, including the satellite antenna, a network modem, and digital decoders — those ‘black boxes’ that receive a signal and turn it into IP packets with wifi access points, similar to what you might have in your home or office.
To mimic the speed of service we’re accustomed to on the ground is a question of bandwidth. Demand for more bandwidth means the world needs more “high capacity” satellites.
A Piece of Sky
“We’ve been planning for this for years, knowing there will be insatiable demand for connectivity, whether it be on the ground or in the air,” said Don Buchman, vice president and general manager of Viasat’s Commercial Aviation business.
Viasat didn’t have to launch any new satellites to fulfill Delta’s current agreement. Their satellites already in orbit were built with the capability to support everything Delta just announced. “The capability has been there for years. The airlines didn’t realize they needed that much bandwidth,” said Buchman in a phone interview.
The company has been launching satellites since 2011. But to keep up with increasing demand this year, Viasat will launch Viasat 3, a trio of satellites with one terabit per second of capacity. Once all three are in orbit, about 18-24 months from now, Buchman says the coverage will “cover the globe” excluding the two poles.
His company’s core business is actually delivering consumer internet to homes in rural areas outside cities. But he says they’ve seen an increased demand from airlines spurred by the travel industry’s pivot to personalization. “When you think about personalization and your relationship with a brand, that’s the next frontier of travel,” said Bastian at CES today. It’s a common refrain in the entire hospitality industry, as it strives to fully recover from the pandemic.
“We’ve been watching the ball drop for a long time. Streaming was the start of it, as airlines cater to individual tastes. We wanted to make sure our system was able to support them,” adds Buchman.
Viasat’s four largest airline customers are United, American, JetBlue, and now Delta. If this new wifi-at-scale mission works, all competitive carriers will presumably feel pressure to up their internet capabilities. To win Delta’s business, ViaSat went through a rigorous request-for-proposal process and testing. Essentially, they tried to crash the system in a simulated scenario. For example, assume each of the 200 passengers on a given plane is using a device to browse the web, answer emails, watch video, or chat at the same time — and test the performance.
“The key for this kind of system is the peak; you get measured by how well you do at peak demand at a concentrated time and geography. For example, on a Monday morning around a busy hub in New York, DC, or Atlanta, that’s where the system needs to keep up,” explains Buchman.
The Test Flight
On the “festival shuttle” flight to the CES conference from New York to Las Vegas on Jan. 4, we were all guinea pigs. About 106 passengers on board logged into their Delta Skymiles accounts at the same time to test the free wifi on a Boeing 737. By all accounts, it actually worked, albeit slightly unevenly with the occasional throb of a loading icon. It had better work to keep this highly caffeinated crowd of corporate conference-goers connected to their multiple devices, collectively creating a symphony of emails, texts, and Slack channel chats which seem so all-important at 30,000 feet.
When the system goes live February 1, the service will be free not just for VIP suits, but for anyone and everyone who signs up for a free SkyMiles membership account. It’s the ultimate loyalty play, in an industry increasingly reliant on frequent flyer programs and the credit card companies that help finance them. In Delta’s case, it’s American Express.
“Not only can inflight connectivity help airlines attract new customers and keep existing ones happy, but it also opens the door to new revenue generation opportunities for airlines to support the industry’s ongoing recovery. We’ve been tracking the desire for inflight connectivity for years and can see it shows no signs of slowing down,” said Niels Steenstrup, President of Inmarsat Aviation, a global satellite communications services company.
The big question for Delta, and any other major carrier that decides to offer wifi-at-scale, is whether they will “throttle it”, i.e. manage the traffic by limiting bandwidth (thereby lowering its service costs), or “open the pipe” — which is essentially allowing all manner of downloading or streaming, on any platform. One of Viasat’s main services is helping its clients optimize internet traffic.
No one really expects Delta to open the pipe — not even Bastian, who said: “This will be a day by day decision as we go. ViaSat knows this; not all streaming content is created equal. So, we’re not going to open the pipe until we understand what it does to the customer experience.”