IT REPORT
ExpendITure SITA’s latest sector report, Air Transport IT
SITA is virtually alone in the realm of
gathering and distributing sector data,
particularly when it comes to areas
that are less than mainstream. Carrier
and airport IT spend is perhaps typical of
these and the company’s annual roundup,
as usual, o ers a window on what is
happening behind the scenes.
It’s an alarming thought, perhaps, but
a couple of decades ago few within the
aviation sector were overly excited by the
progress being made by IT. In that short
space of time though, technology has
proved to be an indispensable asset and,
as today’s traveller is increasingly ordering
his or her own journey, so its manifold
possibilities have been eagerly embraced
by airport, airline and handler alike. In
consequence, when one reads of stagnating
investment in terms of IT, then it can only
raise an eyebrow – but such has been the
reality in certain areas.
Airline IT budgets actually plateaued
over the 2016-2017 period, at a 3.12% total
IT spend as a percentage of revenue. But in
2018 (and as predicted by CIOs), the sector
witnessed a signi cant rise, with total
airline IT spend increasing substantially
that year to reach a 4.84% fraction of
airline revenue.
According to the report (in late 2019),
airline operating spend on IT had now
reached 2.89% of total revenue, compared
to 1.90% in 2017. at looks quite
promising – and all the indications are
that this level of investment is predicted to
remain largely stable, with the 2019 spend
gure expected to be around 2.91%.
Capital expenditure also increased in
2018 to reach 1.95% in 2018: this was up
from 1.24% in 2017. In fact, airlines were
also predicting an increase in capital spend
in 2019, with 2.31% a realistic gure.
The business
According to SITA, passenger processing
for operations is currently the leading
use of Business Intelligence, with 44% of
airlines having implemented an initiative
so far. Encouragingly, a further 45% plan to
invest in this area by 2022.
Of rather more concern is the take-up
of technology to meet IATA’s Resolution
753, that which concerns the tracking
of baggage across a journey. Airlines,
Insights 2019, makes for interesting reading,
declares Alwyn Brice.
in general, stated that they desired to
scale up their bag tracking capability but
the bald statistics show that 100% bag
tracking remains the stu of dreams – and
indeed, a large proportion of respondents
are struggling to cover even half of their
networks.
Speci cally, airline momentum
around baggage tracking has shown little
improvement since 2018, with just 14% of
airlines able to track baggage across more
than 75% of their route network (although
encouragingly this gure is up from 6%).
e vast majority of airlines in 2019 have
capabilities for tracking bags below 50%
of their route network; airlines report
that they are optimistic for 2022, though,
with 48% of carriers planning to have bag
tracking capabilities for over 75% of their
network routes by then.
The view from the airport
Moving over to the airport sector, it
becomes quite clear that those in the
survey are geared towards increasing
numbers of passengers.
One major trend is the growth of
investment in automating the passenger
journey in order to provide a faster, more
pleasant airport experience. Faced with
the challenge of mushrooming traveller
numbers, the vast majority of airports are
leveraging Business Intelligence to improve
passenger processing. Personalised
communications via mobile phones is a
de nite trend and the mobile app has, of
course, already proved its worth.
Statistically, IT and telecommunications
spend as a percentage of revenue continues
to increase: it reached a new high (6.06%)
in 2018, and was expected to rise slightly to
6.26% by the close of 2019.
Airports have a responsibility to keep
ahead of the game; thus it is not surprising
to learn that 64% of them reported that
absolute IT and telecommunications
investment increased in 2018, with only 5%
remarking that it had decreased.
Most airports predict continued growth
over the next two years, with 79% saying
that they were planning for an increase
in 2019 compared to 2018; and with 71%
expecting an increase in 2020 compared to
2019.
Smoothing the passenger ow is also
about e ective queue management. To that
end, wait-time monitoring is the main area
to have witnessed a signi cant increase in
implementation over the last year.
e implementation of wait-time
monitoring has jumped from 31% of
airports in 2017 to 42% in 2018. In 2019,
the vast majority of airports reported
having wait-time monitoring solutions in
place.
Where the real money will be spent,
though, is in the area of emerging
technologies. SITA’s ndings indicate that
some 85% of airports are investing in
biometric identity management solutions
with signi cant growth in the deployment
of major programmes: these are set to rise
12 February 2020 Ground Handling International