deltaffindfw
Topic Author
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Article with Robert Isom, AA President (good info)

Wed Mar 21, 2018 4:14 pm

Interesting article:

https://airwaysmag.com/interview/high-f ... bert-isom/

I few things on aircraft:
- still no decision on A350
- 767s need to be upgraded or they are gone (A350/787/A330)
- A321neo is not a 757 replacement
- 100-110 seat aircraft decision is a few years away
 
Runway28L
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Re: Article with Robert Isom, AA President (good info)

Wed Mar 21, 2018 4:51 pm

I bet AA wants the A350 to be improved with more MTOW boosts before a decision is made. Couple with the 772s still a few years away from being replaced, they don't need the A350 yet.

The 763s are currently going in for WiFi installation. A good start... maybe more mods especially to economy?

The comment on the A321neo is interesting. Just shows how airlines are mixed when it comes to that plane as a 757 replacement. But was Isom referring to the 321neo or the 321LR?

100-110 seat aircraft... really hope they go for the C-Series, even if it's a few years away. Seems like the CS-100 is right up that alley.
 
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millionsofmiles
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Re: Article with Robert Isom, AA President (good info)

Thu Mar 22, 2018 5:18 am

I sure wish Isom reverses the decision to "sunset" seatback IFE. I was traveling LAX-CLT at tithe end of February, and the first thing the guy next to me said when he sat down was, "This plane sucks. No TV." Streaming to your own device is no substitute,
 
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Polot
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Re: Article with Robert Isom, AA President (good info)

Thu Mar 22, 2018 1:23 pm

Runway28L wrote:
I bet AA wants the A350 to be improved with more MTOW boosts before a decision is made. Couple with the 772s still a few years away from being replaced, they don't need the A350 yet.

I doubt AA has much interest in an even more capable A359. Most of their current 77Es are not being used anywhere near their max capabilities as is. If anything they would be more interested in how the improved A339 shakes out vs the A359.
 
EarlyLateORD
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Re: Article with Robert Isom, AA President (good info)

Thu Mar 22, 2018 1:33 pm

Everyone complains about the current 767 modifications in biz class, but they are really quite alright to fly in. They are generally used for second tier routes like MIA-MVD, and the attendants pass out portable media players.

However in Economy, they need a pile of love! The experience flying economy on the 767 versus the 789 is night and day!

Adam
 
davescj
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Re: Article with Robert Isom, AA President (good info)

Thu Mar 22, 2018 1:40 pm

millionsofmiles wrote:
I sure wish Isom reverses the decision to "sunset" seatback IFE. I was traveling LAX-CLT at tithe end of February, and the first thing the guy next to me said when he sat down was, "This plane sucks. No TV." Streaming to your own device is no substitute,


I suspect this was a decision based out of the US model. They had a very poor IFE program prior to the merger if I recall correctly. I was and am still amazed that AA is not making greater steps to keep up with DL and UA. I don't fly UA, so can't say much about it. But I know DL has upgraded many of the plans, not only with Wi FI, but A319s often have personal TV. They haven't updated the A320s, but I would suspect they will.
Can I have a mojito on this flight?
 
commavia
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Re: Article with Robert Isom, AA President (good info)

Thu Mar 22, 2018 1:47 pm

millionsofmiles wrote:
I sure wish Isom reverses the decision to "sunset" seatback IFE.

davescj wrote:
I suspect this was a decision based out of the US model.


I suspect it was more a decision based on economic rationality.

It seems as though AA has concluded that investment in the upfront and recurring costs of AVOD PTVs is not worth it, and given market conditions and competitive dynamics in the industry, it isn't at all difficult to see how AA arrived at such a conclusion. Personally, I've yet to see any clear, demonstrable evidence that AVOD PTVs on domestic narrowbodies is accretive to profit - I remain skeptical that it generates meaningful, durable revenue premiums, let alone revenue premiums sufficient to overcome the higher associated costs. It is for precisely this reason, I'd guess, that every single major U.S. airline except Delta and jetBlue is actively choosing to not invest in AVOD PTVs on domestic narrowbodies, and in most cases are instead investing in cheaper and more agile high-speed streaming solutions. In time, I suspect that the management teams of AA, plus Alaska, Allegiant, Frontier, Southwest, Spirit and United will be proven correct.
 
Austin787
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Re: Article with Robert Isom, AA President (good info)

Thu Mar 22, 2018 4:54 pm

commavia wrote:
I suspect it was more a decision based on economic rationality.

It seems as though AA has concluded that investment in the upfront and recurring costs of AVOD PTVs is not worth it, and given market conditions and competitive dynamics in the industry, it isn't at all difficult to see how AA arrived at such a conclusion. Personally, I've yet to see any clear, demonstrable evidence that AVOD PTVs on domestic narrowbodies is accretive to profit - I remain skeptical that it generates meaningful, durable revenue premiums, let alone revenue premiums sufficient to overcome the higher associated costs. It is for precisely this reason, I'd guess, that every single major U.S. airline except Delta and jetBlue is actively choosing to not invest in AVOD PTVs on domestic narrowbodies, and in most cases are instead investing in cheaper and more agile high-speed streaming solutions. In time, I suspect that the management teams of AA, plus Alaska, Allegiant, Frontier, Southwest, Spirit and United will be proven correct.


The decision to not put IFE in future aircraft is cost savings - nothing to do with "market conditions" or "passenger feedback". USdbaAA may save on costs in the short term, but there is evidence not having IFE is costing them revenue in the long term. Delta and JetBlue have proven a market for PTV equipped planes exists, and both are taking market share from USdbaAA. I know several people who fly on a USdbaAA plane with no IFE, developed a negative impression, and fly a competitor in the future.
 
alasizon
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Re: Article with Robert Isom, AA President (good info)

Thu Mar 22, 2018 5:11 pm

Austin787 wrote:
commavia wrote:
I suspect it was more a decision based on economic rationality.

It seems as though AA has concluded that investment in the upfront and recurring costs of AVOD PTVs is not worth it, and given market conditions and competitive dynamics in the industry, it isn't at all difficult to see how AA arrived at such a conclusion. Personally, I've yet to see any clear, demonstrable evidence that AVOD PTVs on domestic narrowbodies is accretive to profit - I remain skeptical that it generates meaningful, durable revenue premiums, let alone revenue premiums sufficient to overcome the higher associated costs. It is for precisely this reason, I'd guess, that every single major U.S. airline except Delta and jetBlue is actively choosing to not invest in AVOD PTVs on domestic narrowbodies, and in most cases are instead investing in cheaper and more agile high-speed streaming solutions. In time, I suspect that the management teams of AA, plus Alaska, Allegiant, Frontier, Southwest, Spirit and United will be proven correct.


The decision to not put IFE in future aircraft is cost savings - nothing to do with "market conditions" or "passenger feedback". USdbaAA may save on costs in the short term, but there is evidence not having IFE is costing them revenue in the long term. Delta and JetBlue have proven a market for PTV equipped planes exists, and both are taking market share from USdbaAA. I know several people who fly on a USdbaAA plane with no IFE, developed a negative impression, and fly a competitor in the future.


People develop flying preferences all the time, there are plenty that fly DL and/or B6 and then have a bad experience and choose to fly a "non-PTV" carrier. The market for PTV equipped planes exist, but if every carrier equipped their fleets with PTVs, then you end up with more of a supply than their is a demand and nobody makes a profit off it. AA and others likely decided that its worth it to let others have that chunk of the revenue and instead save on costs.

deltaffindfw wrote:
- still no decision on A350


Although there is no "decision", they are hiring project managers currently to work on the A350 EFB which I think says that AA is still moving forward with them at this time.
Manager on Duty & Tower Planner
 
commavia
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Re: Article with Robert Isom, AA President (good info)

Thu Mar 22, 2018 5:17 pm

Austin787 wrote:
there is evidence not having IFE is costing them revenue in the long term.


And that evidence is ... ?

Austin787 wrote:
both are taking market share from USdbaAA.


Source? And again, on what basis can we persuasively conclude that this alleged share shift is attributable to differing IFE offerings?

Austin787 wrote:
I know several people who fly on a USdbaAA plane with no IFE, developed a negative impression, and fly a competitor in the future.


And I know more than several people who comment on how nice AVOD PTVs are when they see them on planes, and then continue to book the schedule and fare that best suits their needs regardless. And I have a strong suspicion about which group, in the aggregate, is larger.

As said - until I see conclusive and persuasive evidence otherwise, I simply do not believe the investment in AVOD PTVs on domestic narrowbodies is worth it. There has to be a causal relationship between the presence of that form of IFE (as opposed to high-speed streaming solutions rapidly being deployed) and a durable, sustainable and systemic unit revenue premium that justifies the higher unit costs. And I still don't see such a causal relationship. I continue to believe that - long-term - the decision being made by AA, Alaska, Southwest and United to focus on power+streaming vs heavy, maintenance-intensive AVOD PTVs will be proven the more optimal, profit-maximizing approach. But we'll have to wait and see.
 
MIflyer12
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Re: Article with Robert Isom, AA President (good info)

Thu Mar 22, 2018 5:20 pm

davescj wrote:
millionsofmiles wrote:
But I know DL has upgraded many of the plans, not only with Wi FI, but A319s often have personal TV. They haven't updated the A320s, but I would suspect they will.


All of Delta's 319s now have AVOD, and do about 1/2 of the 320s (still in process), and all of the 321, 73W, 738, 739, 757, 753, and all widebodies. Stay off the Mad Dog derivatives - 717, MD-88, and MD-90 - and you will find AVOD on a Delta plane. Delta is doing this even as they have put faster satellite wifi on 400+ aircraft.
 
commavia
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Re: Article with Robert Isom, AA President (good info)

Thu Mar 22, 2018 5:29 pm

tphuang wrote:
I don’t think it will be a problem for aa in markets where aa has the best schedule and network advantage. But in a market like New York and la, we will get a true measurement if it matters or not.


Well by that logic, I don't think we have to wait very long. There are lots of markets in both NYC and LAX where AA - and Alaska, and Southwest, and United - already heavily overlap with Delta and/or jetBlue. So again, is there persuasive evidence that in such markets, Delta and/or jetBlue derive a meaningful, durable unit revenue advantage that justifies the higher unit costs of AVOD PTVs on domestic narrowbodies?
 
tphuang
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Re: Article with Robert Isom, AA President (good info)

Thu Mar 22, 2018 5:30 pm

commavia wrote:
Austin787 wrote:
there is evidence not having IFE is costing them revenue in the long term.


And that evidence is ... ?

Austin787 wrote:
both are taking market share from USdbaAA.


Source? And again, on what basis can we persuasively conclude that this alleged share shift is attributable to differing IFE offerings?

Austin787 wrote:
I know several people who fly on a USdbaAA plane with no IFE, developed a negative impression, and fly a competitor in the future.


And I know more than several people who comment on how nice AVOD PTVs are when they see them on planes, and then continue to book the schedule and fare that best suits their needs regardless. And I have a strong suspicion about which group, in the aggregate, is larger.

As said - until I see conclusive and persuasive evidence otherwise, I simply do not believe the investment in AVOD PTVs on domestic narrowbodies is worth it. There has to be a causal relationship between the presence of that form of IFE (as opposed to high-speed streaming solutions rapidly being deployed) and a durable, sustainable and systemic unit revenue premium that justifies the higher unit costs. And I still don't see such a causal relationship. I continue to believe that - long-term - the decision being made by AA, Alaska, Southwest and United to focus on power+streaming vs heavy, maintenance-intensive AVOD PTVs will be proven the more optimal, profit-maximizing approach. But we'll have to wait and see.

I don’t think it will be a problem for aa in markets where aa has the best schedule and network advantage. But in a market like New York and la, we will get a true measurement if it matters or not.

Time will tell.
 
HPRamper
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Re: Article with Robert Isom, AA President (good info)

Thu Mar 22, 2018 5:38 pm

Austin787 wrote:
The decision to not put IFE in future aircraft is cost savings - nothing to do with "market conditions" or "passenger feedback". USdbaAA may save on costs in the short term, but there is evidence not having IFE is costing them revenue in the long term. Delta and JetBlue have proven a market for PTV equipped planes exists, and both are taking market share from USdbaAA. I know several people who fly on a USdbaAA plane with no IFE, developed a negative impression, and fly a competitor in the future.

You spelled "AA" wrong. Multiple times. I'm sure it was an honest mistake and you aren't intentionally being obnoxious.
 
Austin787
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Re: Article with Robert Isom, AA President (good info)

Thu Mar 22, 2018 7:41 pm

commavia wrote:
Austin787 wrote:
there is evidence not having IFE is costing them revenue in the long term.


And that evidence is ... ?

Compare AA's and Delta's financial reports over the years

commavia wrote:
Austin787 wrote:
both are taking market share from USdbaAA.


Source? And again, on what basis can we persuasively conclude that this alleged share shift is attributable to differing IFE offerings?

Look at JFK and BOS. Delta and JetBlue are expanding while AA only cuts. Just speculating: Is it a coincidence that the airline downsizing JFK and BOS also offers the worst IFE?
 
commavia
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Re: Article with Robert Isom, AA President (good info)

Thu Mar 22, 2018 7:48 pm

Austin787 wrote:
Compare AA's and Delta's financial reports over the years


Respectfully, I didn't ask for evidence of whether Delta has achieved a yield premium over AA at a system level. The yield premium isn't that large, but it is unquestionably there (at least for now). My question was, specifically, whether evidence existed that indicates this unit revenue premium is attributable to varying IFE offerings. I have yet to see any such evidence.

Austin787 wrote:
Look at JFK and BOS. Delta and JetBlue are expanding while AA only cuts. Is it a coincidence that the airline downsizing JFK and BOS also offers the worst IFE?


There are literally so many confounding variables inherent in the above comparison that I'd say it's essentially impossible to seriously and credibly arrive at the conclusion based on the alleged evidence offered.

Again, there is no question that AA's market share in the NYC metro has declined in the last decade, both in absolute terms and relative to both Delta and JetBlue. But as said, that's not the question. The question is whether persuasive evidence exists to suggest that this market share change in NYC - which, by the way, is obviously not at all indicative of market share at a system level - is attributable to varying IFE offerings.
 
AA94
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Re: Article with Robert Isom, AA President (good info)

Thu Mar 22, 2018 8:09 pm

HPRamper wrote:
You spelled "AA" wrong. Multiple times. I'm sure it was an honest mistake and you aren't intentionally being obnoxious.


Perhaps obnoxious, but also largely true.

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