Emirates Boeing 777-300ER at Düsseldorf Airport (DUS)

Emirates Significantly Increases Prices For On Board Wi-Fi Access

Posted on Posted in AIRLINE, NEWS, PASSENGER EXPERIENCE, TECHNOLOGY

Emirates announced it will end one of the biggest perks for all passengers with a significant price increase to access its on board Wi-Fi system on all long haul flights in effect immediately.

 

Emirates

For more than 2.5 years, Emirates had marketed the inexpensive on board Wi-Fi access as a selling point for travellers flying on its flights and connecting through its hub at Dubai International Airport (DXB) (Related news on Emirates Offers Free Wifi to Long Haul Passengers).  It was considered a marketing game changer in 2014 when selling 500MB for USD1 was not a common practice in the airline industry.

 

How Does The New Payment System Work?

Wi-Fi access pricing is now determined by the class of service and the passenger’s Emirates Skywards status level. Gold and Platinum members will now get free unlimited access travelling on all classes of service. Non members and up to Silver level members will have the first 20MB free if used within 2 hours of first log on (up from 10MB previously) and pay up to USD15.99 afterwards for an additional 500MB (check reference table below pricing). That is a price increase of between 500 to 1500% from the original offer depending on the passenger’s status.

 

Emirates Skywards Status Level Class of Service
Economy Business First
Non-Member

20MB free within the first 2 hours of log in

Additional 150MB for USD9.99 (~GBP 7.76 / EUR8.76)

Additional 500MB for USD15.99 (~GBP12.41 / EUR14.02)   

Blue

20MB free within the first 2 hours of log inAdditional 150MB for USD6.99 (~GBP5.43 / EUR6.13)

Additional 500 MB for USD10.99 (~GBP8.53 / EUR9.64)

Free unlimited Wi-Fi for entire flight Free unlimited Wi-Fi for entire flight
Silver

20MB free within the first 2 hours of log inAdditional 150MB for USD4.99 (~GBP3.87 / EUR4.38)

Additional 500MB for USD7.99  (~GBP6.20 / EUR7.01)

Free unlimited Wi-Fi for entire flight Free unlimited Wi-Fi for entire flight
Gold and Platinum   Free unlimited Wi-Fi for entire flight

 

 

“Emirates has made significant investments in our inflight connectivity. Today, Wi-Fi services are available on over 200 of our aircraft, and it is a service that Emirates continues to subsidise heavily. Inflight Wi-Fi usage, already popular from the start, has grown tremendously. Our new inflight Wi-Fi plans reflect Emirates’ commitment to continue providing this as a free service for as many customers as possible, especially to our most frequent flyers,” said Adel Al Redha, Emirates Vice President and Chief Operations Officer.

 

Analysis

Emirates has been coming under revenue and cost pressures since the large electronic device ban was initiated in March 2017 on nine airlines in the Middle East and North Africa. While the airline and DXB provided evidence of compliance (Related news on clearance) and obtained clearance on the U.S. Department of Homeland Security new enhanced security measures on July 5, 2017 (Related news), it is just starting to regroup from a schedule reduction to the United States (Related news on Emirates’ current schedule to the United States).

The airline has been subsidizing passengers to use its on board Wi-Fi system for over 2.5 years. The total cost is substantial and may not be sustainable as the airline continues to grow its long haul fleet and destinations served. For example, if all 615 passengers on its high density Airbus A380-800 were to use the 500mb allocation previously given, the airline would only receive USD 615 while paying for up to 307.5 Gb of data. Multiply that by thousands of flights Emirates operate yearly, the total bill may be too much for the airline to allocate funds for.

 

Wi-Fi Access
Wi-Fi Access       Source: Emirates

 

While the price increase for economy passengers is not surprising, the heightened cost for those who are travelling in business and first class but are not Emirates Skywards members is puzzling. This new measure may be seen as less luxurious and cheapens the experience for many who do not have any frequent flyer accounts but pay a higher price to fly comfortably.

The new pricing scheme will deter many economy passengers from accessing the internet after their initial 20MB is used up. This will improve bandwidth and provide other passengers with higher speed service.  The airline still has one of industry’s best inflight entertainment system dubbed “ice” with over 2,500 channels of tv, movies, music and books available for all passengers.

 

Competition

Competition has not changed significantly since Emirates’ first introduction of inexpensive Wi-Fi access over the past 2.5 years. Its new Wi-Fi pricing scheme compare favorably to other network airlines charging by capacity but may be higher per MB basis than those with options to pay for an entire flight’s access. Until data access costs are reduced and more bandwidth is available, the world’s airlines will likely not subsidize free or significantly reduce price on Wi-Fi access for all passengers.

There are some exceptions in the industry. jetBlue Airways offers free connectivity on domestic and Caribbean flights equipped with internet access. Long haul low cost carrier Norwegian Air Shuttle (DY) has the same service for all passengers on selected domestic European and international flights between the United States and the Caribbean. Emirates’ chief Middle Eastern competitor Etihad Airways (EY) provides free Wi-Fi access for all passengers travelling long haul in Business, First/First Apartment and Residence class. This is also the case for Qatar Airways (QR) with their long haul Business and First class passengers.

 

Wi-Fi On Board Source: Norwegian Air Shuttle
Wi-Fi On Board      Source: Norwegian Air Shuttle

 

Introducing a pricing scheme for non-member Business and First passengers allows Emirates the ability to make additional revenue from those who got their seats through a partner airline’s award redemption. Based on passengers feedback, the airline might revise this policy and provide a code for those travelling on a revenue ticket to access Wi-Fi for free.

 

 

 

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