Press Release
Press Release

Ryanair goes off-air
Ryanair goes off-air
Geneva - April 05, 2010

Ryanair is to discontinue its OnAir cabin cellphone service. The Geneva-based connectivity provider announced the rupture on March 29, citing a failure to “reach a mutual agreement on the process and timing leading to full deployment” and declining to answer any questions.

Questions there certainly are. When the trial service was launched with great fanfare just over 12 months ago it was revealed that OnAir had paid for the Thales-developed equipment while the airline footed the installation bill. Now that the satellite antenna, picocell, leaky-feeder cabin antenna and other units in the aircraft are so much dead weight, nobody’s saying how much of it will be removed, and at whose expense.

Then there’s the matter of commercial returns over the past year, during which the service was available in 50 aircraft, nearly a third of the fleet. “The cost of modifying each aircraft is a six-figure sum,” Ryanair boss Michael O’Leary said last year. “We split the expense with OnAir, and our revenue share reflects that.”

At that time O’Leary was talking a good game about the earning potential of onboard cellphone. “We’re euphoric to be launching Europe’s first fleetwide service,” he said. “We expect millions of our passengers to use it as they become familiar with it, and we see it as a growing source of ancillary revenue, allowing us to continue lowering our fares.”

He did emphasize the exploratory nature of the initial effort, however: “This is a six-month trial. If for some reason it proves unsuccessful, we may not continue with the rollout. But experience in the rest of the world shows that this is unlikely to be the case.” Now the unlikely has come to pass and Ryanair evidently wants out.

OnAir chief executive Benoit Debains may recently have provided a clue as to why the relationship with his highestprofile client so far came unraveled. Talking about log-on rates among his airline customer base, he said: “At close to 50 per cent the rate with British Airways is outstanding. Wataniya and Royal Jordanian are hitting 20-25 per cent, and the figure is lowest on TAP Portugal and Ryanair.”

Flight duration factor

He described Ryanair’s comparatively short average flight duration as a factor and said that OnAir was developing applications and offers designed to offset the fact that on short flights people generally don’t see any need to make calls. “In this market—leisure but with a bit of business too—we need to offer services beyond the basic use of the phone,” he said. Flight duration killed Ryanair’s previous venture into IFE/ connectivity. The airline launched a handheld IFE offering based on digEcor players in 2005, only to ditch them a few months later when it became clear that sector lengths were too short for the service to be workable.

If OnAir’s Benoit Debains is dismayed at the Ryanair outcome he’s making a good job of concealing the fact. “It’s disappointing that we couldn’t reach agreement on the detail of a roll-out to the entire fleet,” he said this week. “But our experience was extremely positive and we wish Ryanair every success in the future.”

It could be that the pain of losing Ryanair is tempered by the prospect of bigger and better business to come - earlier this year Debains said that OnAir had a deal in the pipeline that would “blow your socks off”. And this week the company declared that it would shortly announce agreements with new airline customers and strategic partnerships with major mobile phone operators, and would launch service with six of its previously announced clients during the course of the year.