Airports will invest more money on IT than ever before this year and their commitment to spending big on technology is being matched by the airlines, with both focusing their efforts on similar priorities.
Indeed, according to SITA’s latest report, Air Transport IT Trends Insights, top of the agenda for CIOs at both airlines and airports are investment in cyber security and cloud services. In addition, they are prioritising investments in passenger self-service.
SITA’s research shows that their IT spend remains strong, with a colossal $33 billion expected to be invested by the world’s airports and airlines on new technology in 2017.
It says that airport spend as a percentage of their overall revenues will rise an estimated 5% this year or $8.43 billion, while for airlines the upturn is expected to be 3.3% or $24.3 billion in 2017.
Looking ahead to 2018, over 70% of airlines and 88% of airports are expecting IT spend to increase or remain at the same levels as today.
And as IT spend rises, says SITA, both airports and airlines agree that the number one priority for their investments is cyber security.
Nearly all of them – 96% of airports and 95% of airlines – plan to invest in major programmes or R&D on cyber security initiatives over the next three years.
According to SITA, this shows alignment across the industry on the importance of investing in this area.
Ilya Gutlin, SITA’s president of Air Travel Solutions, says: “The air transport industry is going through a digital transformation and focusing its attention on protecting the business and passengers; making it more efficient; and improving the passenger experience.
“Cyber-attacks are a very real threat in the highly interwoven air transport industry, so building solid defences is essential.
“Cloud services provide important efficiencies which play a key role in keeping costs down. Investments in self-service improve passenger satisfaction as they welcome the independence and efficiencies it delivers.”
He continues: “When it comes to IT investment, airports and airlines are aligned to provide better, more secure service to customers.
“The interdependencies built into air transport systems mean investments and improvements in all these areas, by airlines and airports alike, will continue to contribute to a strong global industry.”
Antoine Rostworowski, director of airport customer experience and technology at ACI World, notes: “SITA’s research, which was co-sponsored by ACI, reveals valuable insights for our industry.
“It is encouraging to see the alignment of investment priorities among airports and airlines, which reflects the collaboration between ACI and IATA on best practices.
“ACI and IATA have joint initiatives such as Automated Border Control, end-to-end baggage tracking (Facilitation), Data Exchange, Common-Use (Airport IT) and Smart Security.
“Industry partners such as SITA and others are also involved in these initiatives to make airports more efficient and to improve the passenger experience.”
Cloud services are another top investment priority with 95% of airlines and 85% of airports planning to invest over the next three years, continuing an upward trend that SITA has recorded since 2015.
The third key area of investment that was highlighted by both airlines and airports is the desire to provide more self-service options to passengers.
At airports, self-service processes at check-in, bag drop and boarding are increasingly popular with passengers and 89% of airports are investing in these processes.
Airports operators are also said to have a keen focus on improving the journey through the terminal, and as a result, are looking to new technologies such as the Internet of Things, beacons and sensors to support their goals.
SITA’s insights show that 80% are investing, or planning to invest, in these technologies over the next three years.
Nearly three quarters, 74%, are investing in wayfinding solutions and 68% in solutions to improve personalisation for the passenger.
Airlines, says SITA, are focusing on providing mobile services. Today the majority provide check-in (73%), boarding (70%) and flight status notifications (68%) via mobile and by 2020 more than 97% plan to do so.
A key area of growth, suggests SITA, will be providing real-time flight updates over social media, which will jump from 31% of airlines doing so to 92% in the next three years.
Providing a seamless experience is key to the airlines. In total, 94% rate streamlining services into a single app as a priority, with 58% rating this as a high priority.
Mobile app capabilities and usability are developing quickly and an increasing number of airlines plan to use mobile as a customer service tool, including at times of disruption.
AI, chatbot and beacons
Another revelation of the new report is that airports and airlines are increasingly embracing new technologies and turning to artificial intelligence (AI) to support their customer service.
In fact according to SITA, over the next three years, 52% of airlines plan major AI programmes or R&D and 45% of airports will invest in R&D in the next five years.
Airlines are looking at how technology can help minimise the impact of disruption on the passenger experience and their business and, over the next three years, 80% of them plan to invest in major programmes or R&D into prediction and warning systems, which rely heavily on AI.
Another technology that is catching the attention of the industry, says the report, is chatbots. Today, 9% of airports and 14% of airlines use chatbots, however, there is said to be a “significant appetite” among air transport CIOs to embrace this technology over the next three years.
So much so, in fact, that Air Transport IT Trends Insights predicts that 42% of airports and 68% of airlines plan to adopt AI-driven chatbot services by 2020.
SITA’s report also shows that mobile app development is a top priority among airlines and airports. Indeed, over the next three years, 94% of airlines and 82% of airports plan major mobile programmes or R&D.
The main area of focus is in the commercialisation of their mobile services with airlines looking to boost both direct and ancillary sales via their apps. In fact, airlines expect sales via their mobile apps to double by 2020 and reach 17% of their total sales.
Streamlining services into one single app to deliver a seamless experience is a priority for almost every airline (94%) and a high priority for more than half (58%).
Jim Peters, SITA’s chief technology officer, says: “We know that passengers prefer to use technology, and when it is well designed it can really improve the passenger experience.
“Airlines and airports are investing in AI and mobile programmes to make services even better for the passenger, supporting sales and providing customer support, particularly during times of disruption.
“The industry is using a healthy mix of in-house and outsourced development which will combine expert and industry-specific knowledge with emerging approaches to tech offerings.”
Airports plan to use chatbots for services such as notifications and airport guides. They are also looking to beacons and sensors to help provide context and location-aware services.
SITA’s research shows that 40% consider this area a ‘high priority’ for app development and a further 43% consider it a ‘priority’.
“Airports clearly recognise the opportunity to provide useful and relevant mobile services to passengers to optimise time spent at the airport,” says SITA.