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Frontier Adding DirecTV

Fri Jun 07, 2002 11:45 am

Thursday June 6, 7:14 pm Eastern Time
Reuters Company News
Frontier Airlines to offer inflight satellite TV

DENVER, June 6 (Reuters) - Frontier Airlines (NasdaqNM:FRNT - News) said on Thursday it plans to install DirecTV satellite television on some of its planes, which would allow passengers to watch two dozen channels of news, sports and other real-time television from their seats.

Frontier, a Denver-based low-cost airline, said it would be the largest air carrier to sign up for the inflight DirecTV service. Rival low-cost carrier JetBlue Airways (NasdaqNM:JBLU - News) offers the same satellite service to its passengers.

Frontier said it expected to have a deal written up for the purchase and service of inflight DirecTV equipment by July 1.

DirecTV, the largest satellite broadcaster and a unit of Hughes Electronics Corp., is in the process of being acquired by rival EchoStar Communications Corp. (NasdaqNM:DISH - News).

The DirecTV equipment will be installed on Frontier's Airbus A319 airplanes and certain Boeing aircraft starting in October. Frontier expected the work would be finished by next spring.

Yes, I actually *do* work for an airline,how about you?
 
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OA412
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RE: Frontier Adding DirecTV

Fri Jun 07, 2002 11:53 am

Sounds like a good move by F9. Honestly, I would rather have the choice of 24 channels where I am pretty much assured to find something I like rather than be forced to pay $5 for a movie I wouldn't have watched at the box office anyway.
Hughes Airwest - Top Banana In The West
 
Guest

RE: Frontier Adding DirecTV

Fri Jun 07, 2002 12:09 pm

Wow, this just reeks of merger with Jetblue!
 
ILUV767
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RE: Frontier Adding DirecTV

Fri Jun 07, 2002 12:14 pm

OA412 wrote:
Sounds like a good move by F9. Honestly, I would rather have the choice of 24 channels where I am pretty much assured to find something I like rather than be forced to pay $5 for a movie I wouldn't have watched at the box office anyway.

Too bad the movies are free on United, and last time I checked on any other airline, they never force you to pay for the movie.

Honestly, I dont think that F9's decision to add this will make any difference in the market. Passengers dont give a damn about direct tv. This is not why JetBlue wins over some passengers. They win over passengers because of their location to Queens and southern Connecticut in need of a low fare airline.

I wonder what DirectTV will come at the expence of...my guess is meals.

I L U V 7 6 7
 
MAH4546
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RE: Frontier Adding DirecTV

Fri Jun 07, 2002 12:18 pm

ILUV767, depending on length of flight and programming, movies are not always free. Internationally they are always free, IIRC, but domesticly they are not, depending on the airline. I know Delta still charges.
a.
 
mlsrar
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RE: Frontier Adding DirecTV

Fri Jun 07, 2002 12:23 pm

DirecTV doesn't always guarantee success, ask Legend about refitting aircraft.

Their current business model must work quite well, as their traffic increased 47% over last May.

If it ain't broke...
I mean, for the right price I’ll fight a lion. - Mike Tyson
 
flyingbronco05
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RE: Frontier Adding DirecTV

Fri Jun 07, 2002 12:26 pm

Frontier Airlines Signs Letter of Intent with LiveTV to Bring DIRECTV Programming to Every Seat in its Fleet

"DENVER--(BUSINESS WIRE)--June 6, 2002--Frontier Airlines (Nasdaq: FRNT - News) today announced that it has signed a Letter of Intent with LiveTV to customize the seats in its fleet with DIRECTV® satellite programming."

More at: http://biz.yahoo.com/bw/020606/60328_1.html

I was going to post this but I saw it so I didnt post it. I just decided to add another article for you guys to read.
Never Trust Your Fuel Gauge
 
Dash8King
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RE: Frontier Adding DirecTV

Fri Jun 07, 2002 12:45 pm

ILUV767 how can you say it doesn't make a difference. If you had the choice between AA with no movie and no Directv and Frontier with live channels why would you pick AA over F9 with exception of using points? The average person cares! Tango charges I believe.
 
ILUV767
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RE: Frontier Adding DirecTV

Fri Jun 07, 2002 1:26 pm

MAH4546 wrote:
ILUV767, depending on length of flight and programming, movies are not always free. Internationally they are always free, IIRC, but domesticly they are not, depending on the airline. I know Delta still charges.

If you would actually fly United, you would know that the movies are free on all flights. If you dont belive me, I'll take you up to the United challenge. Lets see...since last january, I've done over 80 segmants on United. Many of those has been transcons, as well as midcons. I know the service inside and out. You wanna step outside buddy?  Smile/happy/getting dizzy

Dash8King wrote:

ILUV767 how can you say it doesn't make a difference. If you had the choice between AA with no movie and no Directv and Frontier with live channels why would you pick AA over F9 with exception of using points? The average person cares! Tango charges I believe.


If I had a choice, you're right, I'd take F9 becuause of the entertainment. Now, however, on the flip side, if you ask 99.9% of the low yeild leasure traveler what is most important to them, they will say price. If they are not loyal to a millage program, they dont care what airline or how many stops it is...they care about the price.

Bottom line, most low yield travelers want a cheap ticket. They dont care about movies and meals. They just want to get to their destination.

High yield travelers on the other hand want an airline that offers good inflight service, with a premium cabin and lots of connections. This is where American, United, Delta and even to some degree Continental come into play.

F9 is fighting a loosing battle as they do not cater to the biz traveler like UA. (they dont care about DirectTV...they want a F class seat). I dont think that they expect to pick up that many low yielding travlers by offering DirectTV.

I L U V 7 6 7
 
Dash8King
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RE: ILUV767

Fri Jun 07, 2002 1:39 pm

Alright I see your point. I guess they just want to offer more then Southwest. I am not really aware of Frontiers destinations do they complete a lot with southwest?
 
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OA412
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RE: Frontier Adding DirecTV

Sun Jun 09, 2002 11:33 am

Too bad the movies are free on United, and last time I checked on any other airline, they never force you to pay for the movie.

UA is the only US major with free movies so the fact that most charge $5 for a movie is more than relevant. Besides, I don't fly UA so it makes not difference to me whether or not they offer free movies. And, yes I'm pretty sure that B6 has attracted at least some passengers because of DirecTV. If fares and schedules are the similar, passengers are going to go for the amenities, simple as that.
Hughes Airwest - Top Banana In The West
 
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RE: Frontier Adding DirecTV

Sun Jun 09, 2002 12:57 pm

I think United stopped charging for movies because... well probably only about half the people were paying anyway.
 
ILUV767
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RE: Frontier Adding DirecTV

Mon Jun 10, 2002 5:40 am

OA412 wrote:
UA is the only US major with free movies so the fact that most charge $5 for a movie is more than relevant. Besides, I don't fly UA so it makes not difference to me whether or not they offer free movies. And, yes I'm pretty sure that B6 has attracted at least some passengers because of DirecTV. If fares and schedules are the similar, passengers are going to go for the amenities, simple as that.

Im sure that JetBlue has attraced many many customers with Direct T.V. and the promise of low fares. However, on the New York transcons, where JetBlue is really big, American, United and Delta all offer a product with more amenities. There are people paying $2000+ for their tickets on that market, and they are sitting in the First class cabin on those planes. JetBlue is taking some of the lower yielding tickets, and yes, while offering Direct T.V., they do not offer the same level of inflight service that a high yield passenger would expect from Delta, American or United.

I L U V 7 6 7
 
Guest

RE: Frontier Adding DirecTV

Mon Jun 10, 2002 6:37 am

>>JetBlue is taking some of the lower yielding tickets, and yes, while offering Direct T.V., they do not offer the same level of inflight service that a high yield passenger would expect from Delta, American or United.<<

Considering it costs about $1800 more for a transcon traveler in coach to fly on DL, AA, UA compared to B6, let's see what we could do with that $1800.

1) Buy a whole row and have a little sleeping area for $1200, then spend $200 for nice sheets and blankets, $300 for noise-canceling headphones, and $100 for a meal to go from a nice restaurant.

2) Buy a whole row, and get a chef to make you a meal there.

3) Spend an extra $5/day on food for a year.

4) Take your spouse with you and then stay a little longer for a small vacation.

5) Treat clients to a great night with great dinner and all.'

6) Buy 90,000 FF miles on the airline you are loyal to.
 
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OA412
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RE: Frontier Adding DirecTV

Wed Jun 12, 2002 3:23 am

However, on the New York transcons, where JetBlue is really big, American, United and Delta all offer a product with more amenities. There are people paying $2000+ for their tickets on that market, and they are sitting in the First class cabin on those planes.

That's all well and good but it completely ignores the current trend in air travel. Corporations, and individuals for that matter, are no longer willing to fork out big bucks for first class but are rather opting to fly economy. I believe that we will see more and more business travellers opt for the cheaper fare even on this route. Frankly, I don't see how one can justify a premium of some $1800 over B6s lowest fare on that route.

JetBlue is taking some of the lower yielding tickets, and yes, while offering Direct T.V., they do not offer the same level of inflight service that a high yield passenger would expect from Delta, American or United.

Again, this ignores the changes currently taking place in air travel. Certainly, B6 is taking some low yield business away from the majors but I would venture a bet that they are also taking high yield business away from them. Anyway, if high yield passengers/business passengers cared so much about inflight service, WN wouldn't be carrying so many business passengers on its planes now would it?



Hughes Airwest - Top Banana In The West
 
flashmeister
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RE: Frontier Adding DirecTV

Wed Jun 12, 2002 3:37 am

The comparisons to Legend are completely out of context -- Frontier is profitable, it's stable, it's got a good customer base, and its got a bright future. Legend was undercapitalized and executed poorly.
 
airworthy
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RE: Frontier Adding DirecTV

Wed Jun 12, 2002 5:27 am

ILUV767,

The points you make are true...but don't necessarily spell success for United in the post 09/11 environment.

The reason why jB is doing so well is not only because of the increased demand for low-fare business traffic, but also because of less demanding needs of the business traveler.

Yes, less demanding needs. It sounds crazy doesn't it? Especially when airlines are upping the in-airport amenities for business travelers, like priority security lines and upgrading of lounges.

Well if you are a biz traveller and the big bucks for astronimically priced full-fare tickets are fine by you, then you're good. But if you're the growing set of biz travelers looking for lower fares, you're going to choose a low-fare carrier because it costs too much to become an elite on a "major" airline. And, when all else is equal you still face the same long security lines and "hassles" of showing up to the airport earlier than before.

In other words, air travel has not become so time sensitive. Before, the plus side of flying full fare were those aforementioned elite perks, but the main reason was the schedule offered by the major airlines. These days, that's become less relevant because you have to show up to the airport earlier than before anyways. This is a key point.

So... let's sat that increasing type of affordable seeking biz traveller is going indeed going to do as predicted and go for the low fares. He lives in Denver and has the choice of Frontier or United -to- Dallas/Ft. Worth at the same price. According to the pre 09/11 model, we'd say he'll go for United if he is a biz traveller because he likes miles and wants to work his way up to or maintain elite status with the airline. Now, we can't be so sure. In fact, it depends on the biz traveller.

However, let's consider how the appeal of M+ would be less effective in this case (these could be his thoughts):
  • Frontier will always try to offer low fares... my perception of them is a low-fare airline, and their slogan is "Always Affordable"
  • I might as well join Frontier's mileage program because they will probably offer more lower fares than not, so I will probably fly them more
  • HEY!!! Frontier offers free DirecTV at every seat.... I've heard about how great this is from news about that cool new airline JetBlue... Frontier must be pretty cool too!
  • Frontier isn't all that more inconvenient than United... I still have to go through that same security line after ticketing... and in fact their terminal is closer and I can walk to it instead of waiting for the train.
  • Froniter has pretty frequent schedules in and out of Denver too...
  • I'm gonna fly Frontier!

    As you can see, if a lowest-fare seeking biz traveller in Denver is already considering Frontier, they are already thinking positive thoughts about it against choosing United Airlines. Once information about Frontier offering DirecTV (a very positive thought) is brought up, this will make the potential Frontier customer even more positive about F9.

    In advertising, we call this "hypothetical THOT analysis". It's a practical way to look at the psychology of consumers, because when we think about their perspective, we will most likely come to their conclusion.

    And you know, everybody knows I'm a United fan for life. But the harsh reality is that UNITED is fighting a losing battle against FRONTIER. Just take a look at this article.

    United Air Market Share Drops At Denver Hub; Frontier Gains
    http://biz.yahoo.com/djus/020531/200205311334000580_1.html
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