Please follow suit Air New Zealand
October 7th, 2010 at 9:31 am by David FarrarThe Herald reports:
Singapore Airlines, the world’s second-largest carrier by market capitalisation, said it will equip long-range wide-body planes with internet and phone-message access to meet growing demand from business travellers.
The carrier said yesterday it had signed a contract with OnAir NV, an on board-communications provider part-owned by aircraft maker Airbus, to install Wi-Fi internet and mobile phone links on the planes in 2011.
I don’t care about the mobile phone links, but I do want Internet access. Lufthansa used to have it, and it was superb. Rather than face a huge amount of work to catch up on when you land, you just use the plane as a mobile office.
For me, offering on board Internet will be a major factor in deciding which airline to fly with, if the flights are more than eight hours.
October 7th, 2010 at 9:39 am
Can’t you go eight hours without youporn?
Vote:October 7th, 2010 at 9:40 am
Air NZ better run along to Mr. Joyce and ask him to do it for them then.
Vote:October 7th, 2010 at 9:47 am
Oh crap. Lack of cell phone coverage and internet access is the one good thing about flying – you get a few hours’ peace.
Vote:October 7th, 2010 at 9:50 am
Oh great, for decades we used to have to put up with second-hand cigarette smoke in aircraft, now we are going to have to put up with the sound of incoming telephone rings and text message alerts, and passengers shouting down their ‘phone so they can be heard over the sound of the aircraft’s engines.
Vote:October 7th, 2010 at 10:05 am
I’m pretty sure that a recent economist article said airline Internet had been a failure. I just can’t recall whether that was a technological failure (ie doesn’t work) or a commercial failure (no-one will pay enough to make it profitable). Either way, I’d prefer air nz wait until someone else has it working and profitable. Since as a taxpayer I still own part of air nz I’d rather they didn’t lose money. Of course, if the govt sells out, then I’m all in favour of air nz providing a service at a loss.
Vote:October 7th, 2010 at 10:09 am
“Either way, I’d prefer air nz wait until someone else has it working and profitable. Since as a taxpayer I still own part of air nz I’d rather they didn’t lose money. Of course, if the govt sells out, then I’m all in favour of air nz providing a service at a loss.”
You’re a Romanian right Paul?
http://www.thediplomat.ro/articol.php?id=1444
Vote:October 7th, 2010 at 10:16 am
Ewwww. BaitRed shows off his reading circle to everyone. Sad Act.
Vote:October 7th, 2010 at 10:17 am
Singapore Airlines actually did have wireless on their planes a few years ago as a trial. I remember sending a email to my wife while flying AKL-SIN in 2005 or 2006 in one of their 747′s. It was during the day, so would have been somewhere over Oz.
Cheers,
Vote:FM
October 7th, 2010 at 10:24 am
You lost me red. I’d rather the govt didn’t own air nz. Since they do, I like it to make a profit. If they didn’t, then I don’t care what air nz do, and if they want to take risks it’s none of my business.
Vote:October 7th, 2010 at 10:51 am
Paul- I was attempting to alert you to the poor business practice of waiting for some other company (the competition) to take the lead. As you say, Air NZ should not be underwritten by taxpayer’s money, and your post and the issues it raises show why.
Vote:October 7th, 2010 at 11:11 am
It’s often good business practice to be a fast follower. The leader can get first mover advantage, but unless they have some sort of network effect, a fast follower gets very similar advantage. Further, the fast follower doesn’t carry anywhere near as much risk of their solution failing (at high cost), or becoming a technological orphan as the technology leapfrogs your first generation solution. Microsoft have been very successful in a fast follower strategy.
The economist article I mention suggested that internet in airplanes really isn’t working. As such, as a part owner of Air NZ, I would prefer they didn’t take this risk. If I wasn’t a part owner, then as a strong supporter of capitalism, I’m all in favour of other people (i.e. the shareholders) investing their money in risky ventures that will probably fail, but in the mean-time will provide the consumer (me) with increased choice.
Vote:October 7th, 2010 at 11:23 am
Some days I just wish for a global EMP to thin out the useless portion of our population who only exist in cyber space while sucking O2 in real space.
Vote:October 7th, 2010 at 11:31 am
“as a part owner of Air NZ, I would prefer they didn’t take this risk.”
I think the people running Singapore Airlines have a little more smart than to use an article by an Economist journalist as the basis for their risk assessment exercise.
They will make it work because they have the will to make it work. How’s Romania’s airline going?
Vote:October 7th, 2010 at 11:47 am
It would be great if there were a few less airlines around so this could happen a bit more easily, DPF. Oh yeah, that’s right, I’d forgotten that competition authorities never let them team up, let alone merge, because it’s quote unquote anticompetitive! Anyone else noticing how that probably makes it less competitive?
Vote:October 7th, 2010 at 12:00 pm
Not for me thanks, flown United with wifi LA to NY, used it once 3 or 4 trips ago, not since. I prefer trying to relax as much as possible on the flight to reduce jetlag & be ready for work when I land.
Vote:Having said that, I think it’s a necessary thing for Airlines to have wifi connectivity & it makes some stuff like inflight sales alot simpler, united & continental have credit card only purchases for instance.
October 7th, 2010 at 12:04 pm
I have long had a dream of running instances or battlegrounds in Warcraft at 30,000 feet.
Vote:October 7th, 2010 at 12:45 pm
Air NZ not quite in the league of SQ, but as we all know they are improving.
My advice: avoid western airlines – older aircraft, air crew too old, unionised and generally poor service.
Along with TVNZ, needs to be privatised.
Vote:October 7th, 2010 at 12:57 pm
IIRC Singapore Airlines have already had inflight WiFi – I’ve used it a few years ago and it was later discontinued. I recall thinking the downlink would be fast and the uplink slow… so I tried a Skype video call. It was amazing! I was able to walk up and down the aisle and broadcast a flicker-free, live link at 800km/h and 38,000ft. My business partner in NZ thought I was playing a trick on him.. but he’d signed off the travel an knew exactly where I was at the time I called him
Vote:October 7th, 2010 at 1:01 pm
As someone who just completed his 36th trans pacific flight a few weeks ago (over 25 years I might add) I heartily endorse David’s sentiment. I spend at least 7-8 hours on those flights sleeping but to be able to email and spend some time on the internet rather than be limited to Air NZ’s programme selection (which is OK) would be awesome.
Vote:October 7th, 2010 at 1:07 pm
Also, some Emirates aircraft are already installed with mobile cell sites. Don’t think this includes the ones that fly the NZ routes. Your phone roams onto their network and is acquired by what looks like a specialist mobile carrier. Can’t recall the call rates, but they were sphincter popping!
Vote:October 7th, 2010 at 1:28 pm
Gwilly, I agree with the advice about avoiding western airlines, but I’d be more specific and say, avoid American airlines (not just American Airlines!), British Airways and any carrier that looks like it’s becoming a creature of its national government. You’re right, let’s hope Air NZ gets privatised before it turns that way! It would also be helpful if one of the airlines convinces some court that a competition agency isn’t actually improving competition by stopping it from teaming up with someone, too.
Vote:October 7th, 2010 at 1:58 pm
Air NZ announced months ago that you’d be able to use Internet on their new planes which are being delivered from early next year.
http://www.stuff.co.nz/travel/3741430/Air-NZs-new-planes-allow-mobile-phones
$40/MB is a little steep, but when you consider that’s only a little bit more than using your phone in the airport when you land it’s not so bad. Hopefully as regular roaming comes down, that follows.
Vote:October 7th, 2010 at 3:48 pm
Hope they do a better job of wiring it in than on Swissair 111. Geeks don’t necessarily work to aero industry standards, as that disaster showed…
Vote:October 7th, 2010 at 5:30 pm
“You’re right, let’s hope Air NZ gets privatised before it turns that way!”
Sometimes Kiwiblog really is comedy gold! When Air New Zealand collapsed who was at the controls? Who had been running the company into the ground prior to its flat spin?
Seriously I’m not so ideologically blinkered that I think one form of ownership is superior to the other. It’s about delivering results and in the case of a strategic organisation like Air New Zealand benefiting the country for which it flies the flag. Air New Zealand following its collapse has gone from a basket-case with an outdated and embarrassingly poor hard product and fleet to a world-leading carrier. It just so happens this has occurred under state ownership.
Look at Qantas, already privatised the loons running the asylum attempted to sell it to a private equity firm and feather their own nests. That failed miserably and those nuts eventually bowed out having systematically destroyed what made Qantas a good airline. Today Qantas remain truly atrocious and is being usurped by its low-cost even more atrocious subsidiary – JetStar. JetStar will continue to grow at the expense of Qantas thanks to a supply of cheap labour in New Zealand. Qantas is so crap that I prefer Garuda Indonesia over them, although I am giving them one last chance in long haul in a couple of weeks.
Singapore Airlines (a state-owned airline) is generally accepted as one of the best airline’s in the world. I would go as far to say that they are the best on balance bar none. They have made a few mis-steps along the way, one of them being their attempt to purchase Air New Zealand (which would have been disastrous for New Zealand as a country) but remain a shining example of how good an airline can be when its not at the mercy of fools.
However, I’m not saying there aren’t good examples of non state-owned airlines. Despite the US airlines being largely deplorable JetBlue and Virgin American stand out as hopefuls. The founder of JetBlue then went to create a new airline in his native Brazil that seems to be on the up and up.
Aviation is a risky industry, and for capital too. But Air New Zealand have provided us as taxpayers with a great return so far, even more so intangibly. They must continue to take risks and set trends in their hard product offering. They have done very well under state-ownership and we must continue to let them do so.
Vote:October 7th, 2010 at 6:50 pm
My advice: avoid western airlines – older aircraft, air crew too old, unionised and generally poor service.
http://tvnz.co.nz/travel-news/air-nz-named-airline-year-3330439
Vote:October 7th, 2010 at 7:33 pm
LeftPilot, where do I start? Air New Zealand was perfect when it was fully-owned by the Government before 1990? You gotta be joking, mate!
The problem with governments running stuff is that, at the end of the day, it’s the politicians running the business at the taxpayer’s risk and expense. I certainly don’t suggest all government businesses are run badly, but the incentives just aren’t there to encourage them to be run well. In the fact of certain scandals involving politicians and porn movies rented on minsterial credit cards, you’ve got to make a pretty good argument about why politicians will be better at running a business than someone whose career and/or money are on the line. If you have such an argument, would you care to pass it on?
Maybe you like governments ’cause they easier for pilots’ unions to bully in wage negotiations. What do you reckon?
Vote:October 7th, 2010 at 7:59 pm
Hahahahahaha more comedy gold – cheers? Pilots wages have taken slides in real terms and it continues to get worse because sadly too few of us have backbones and are actually willing to take massive cuts in terms and conditions and pay for the job to boot. This is having real affects in safety right now. Over time it will eventually become so obvious that something will have to be done. It is just a shame there will be needless loss of life in the interim.
You just go on an ideological rant. I did not say that Government ownership is the answer, but in some cases it works and people shouldn’t be calling for a change when it is not required. You are quite right Air New Zealand was Government owned before Brieley’s destroyed it further. But that is the point, their stewardship of the company did not improve it. After its collapse it was bailed out by the government and has gone from strength to strength. There is a level of certaintiy that ownership by the Government provides. Also the structure around its ownership is quite different to how it was prior to privatisation and is allowed to operate without government intervention.
To say that the politicians are running the business is either incredibly ignorant or ideologically blind! So enough of trolling out the silly statements.
The whole bully thing is still making me chuckle though. Onya!
Vote:October 7th, 2010 at 8:59 pm
Ideological rant, huh? Ideological is a word commonly used when people wanna say someone else is wrong, but aren’t up to arguing why they’re wrong. If you think governments do a better job or running a company than the private sector, please argue why! Don’t just take the easy option and dismiss me as “ignorant or ideologically blind”. I may of course be ignorant sometimes, but, when you believe I am, please convince me of the error of my ways. If you’re not up to doing so, you’re the one risking looking “ideologically blind”!
Vote:October 7th, 2010 at 10:03 pm
Great argument, LeftPilot! I’m off to bed now. Any chance I’ll see some of your logical brilliance tomorrow morning?
Sweet ideological dreams!
Vote:October 7th, 2010 at 10:25 pm
NZ govt should have sold Air NZ to Singapore Airlines when they had the chance instead of wasting $885M of taxpayers money.
Air NZ may be doing well at present, but it will never recoup $885M plus interest incurred to bail it out, and in the long-term it has next to no chance of surviving once there is further consolidation in the industry. The long-term future for the airline is to operate privately on internal routes.
Governments simply have no business running airlines, just like shipping lines, which thankfully we sold in the 80′s.
Vote:October 7th, 2010 at 11:25 pm
Seriously?
Rather than writing it again, although I could quite easily make it part of a thesis see “October 7th, 2010 at 5:30 pm”.
Vote:October 8th, 2010 at 7:26 am
LeftPilot, I’m looking at your 5.30 comment and I’m seeing little argument about why politicians should be any good at running airlines. All I can see is just some unreferenced statements to how Air NZ and Singapore are operating so well and Qantas isn’t. Somehow we’re meant to decide that that is solely because of government ownership.
Forgive me if I’m failing to see what objective argument lies behind this. Would you be able to fill me in on what I’m missing? You’ve already said I’m ignorant or ideologically blinkered so it’s probably best to do so slowly and carefully.
Vote:October 8th, 2010 at 9:35 am
Dumbfuck why do you keep on repeating this nonsense about “politicians running airlines”?
Leftpilot explained exactly what you are still asking for, I suggest you try actually reading it.
Vote:October 8th, 2010 at 10:08 am
Dumbf*ck, huh? No need to get nasty RRM! Surely we can and should all act like adults around here. If, by virtue of Gov’t ownership politicians don’t end up running businesses they have little experience in, how do you explain the recent appointment of Michael Cullen to the board of NZ Post? I guess it was all that experience he had of running postal networks before becoming a politician, eh?
Am I still a dumbf*ck now? No? Maybe I’m ideologically blind? What do you think?
Vote:October 8th, 2010 at 10:27 am
I think there are more than a few people commenting on here who really need to chill out! Just because I’m disagreeing with you is hardly an excuse to start calling me names or commenting on my principles. I am not an unreasonable person – if you think I’m wrong then, by all means, have a crack at convincing me so. I have been known to humbly admit that I’m out of line before, but, if you wanna come after me, you better come packing a good argument!
RRM and LeftPilot, there’s the bar – are you up to clearing it?
Vote:October 8th, 2010 at 2:45 pm
No I thought it was a civilised enough argument. Problem is you keep refusing to read what I write so it is getting rather pointless.
I clearly stated that I don’t think any one form of ownership is better “Seriously I’m not so ideologically blinkered that I think one form of ownership is superior to the other”. But in some cases and in the case of Air New Zealand being a strategically important business for an isolated country it is appropriate.
Please tell me how Government ministers are involved in the daily running of the business? The reality is they way the shareholding is set up that they have far less involvement, read zilch compared to the arrangements when BIL was the cornerstone shareholder. This provides a level of stability and seems to protect them from the likes of what happened previously and what happened to Qantas with the private equity debauchery.
I’m quite chilled about it all, obviously this is my area of interest being in the industry and its worthwhile to clear up misconceptions and falsehoods.
Private ownership works, no doubt about it. But there are very clearly situations when the stability provided to a critical asset of national importance is required and can be extremely beneficial.
Vote:October 8th, 2010 at 2:49 pm
“But there are very clearly situations when the stability provided to a critical asset of national importance is required and can be extremely beneficial.”
Not when government monopolies prevent competition. Air NZ is not any kind of “asset of national importance”. If it was vapourised tomorrow, it would not be missed one iota.
Vote:October 8th, 2010 at 4:03 pm
I think brandishing monopoly about is a little simplistic. I think it would be great if there was more competition in the domestic regional markets, but no-one has been able to reach that critical mass required. Of course some sort of regulation could be implemented to enable a new entrant to survive on the regional domestic market.
New Zealand is after all a country of only 4.6 million and the population centres don’t provide that critical mass to make frequent airline service by a multitude of carriers possible. While I would like to see more options, I don’t think it can be sorely blamed on Air New Zealand.
In terms of pricing, although I used to think ticket prices were quite expensive, having lived overseas for a few years and flown in markets with far larger population bases it doesn’t seem entirely out of line. I’m coming home for a visit soon and was unable to book the cheapest fare for a regional flight from Auckland but the Flexi fare was $287 one way. A little pricey maybe but I really don’t think it unreasonable. My own companies ticket prices are not too dissimilar in a more competitive market.
Although to play on the monopolistic nature “If it was vapourised tomorrow, it would not be missed one iota”. So after an overnight vapourisation the loss of 10,000 jobs and the majority of airline service in New Zealand would not matter, would have no effect on the national economy?
Vote:October 8th, 2010 at 4:23 pm
“So after an overnight vapourisation the loss of 10,000 jobs and the majority of airline service in New Zealand would not matter, would have no effect on the national economy?”
Nope. Another airline would merely take up the empty market space, and do so without the economic distortion caused by a government owned airline. Consumers and businesses in the long run would be better off and so therefore would the employees of the airline. I have no beef with unions (with voluntary membership) looking after the interests of their members, but I am totally opposed to government over-reach into areas of commerce and industry.
I cannot recall the detail now, for it was some years ago (5 maybe) where government policy caused Emirates (I think) to alter their business policy here and this led to increased cost to NZ passengers. (I faintly recall writing on the issue on this blog) The idea was to protect Air NZ. No thanks. Air NZ should stand on its own two feet and not be propped up by government policy that disadvantages and/ or increases costs to consumers.
Vote:October 8th, 2010 at 4:46 pm
The reality of the aviation industry and the five freedoms among other things is that Governments routinely step in to protect their national interests and sometimes by association those of the national carrier regardless of whether they are publicly or privately owned.
Emirates is also a Government owned airline.
Vote:October 8th, 2010 at 4:54 pm
LeftPilot, jn the present argument, I agree with Redbaiter – no one’s going to give two hoots if Air NZ goes, It would leave a profitable opportunity and an overseas firm would enter, hire Air NZ’s workers, get some planes and restart domestic services. So what?
How is the Government involved in running the day-to-day business? Quite simple, it appoints the directors, who employee managers below them, who employee staff below them. You ever worked in a crap company? If you don’t know how important it is to get the right people at the director level, you need to try working in one that doesn’t have them – and yes plenty exist, even in the private sector.
I agree it was quite a civilised argument – I’m hardly going to get all offended because someone called me ideological! However, then someone else went and called me a f*ckwit; bye bye calm civilised argument.
Finally, if you think the Government always runs companies in a stable manner, how do you explain the bailout of BNZ in 1990 or the recent shortfall in ACC’s non-earners account? Both Government and the private sector make mistakes! Do we expect one to be better than the other? Yesterday at 7.33pm, I made an argument that we can expect the private sector to be better (on average). I asked for a counter argument; so far, none has been forthcoming. Care to try now?
Vote:October 8th, 2010 at 5:11 pm
“The reality of the aviation industry and the five freedoms among other things is that Governments routinely step in to protect their national interests and sometimes by association those of the national carrier regardless of whether they are publicly or privately owned.”
Yes, I do not deny this is the reality. What we are debating here is whether that reality is ultimately beneficial or not. I say that market distortion caused by government intervention is harmful to business, consumers and employees. You say that it is warranted sometimes. I say it is never warranted.
Mjwilknz makes a good point regarding appointment of management by politicians. How you can say that this is ever a good thing completely baffles me. At least if private companies appoint poor management they are not bailed out by the taxpayer. Or at least they shouldn’t be, as the Obama/ Bush TARP program is about to demonstrate so well by means of a massive negative impact upon economic recovery there. (leaving aside the corruption and waste the program has been most notable for)
The bottom line is market distortion by governments. I think global events and history pretty much demonstrate that this is most often an exercise in self defeat. Ideologues of the left as always will deny this reality until their Potemkin village collapses in a sorry heap around them. This failure to recognise economic reality is endemic in the left, and it is why all socialist experiments ultimately end in failure.
Vote:October 8th, 2010 at 5:12 pm
LeftPilot @ 4:46, two wrongs don’t make a right. If some other country wants to own an airline and make silly decisions with it, let them. Nothing’s being done for NZ taxpayers if we do the same!
Vote:October 8th, 2010 at 7:58 pm
I asked for a counter argument; so far, none has been forthcoming. Care to try now?
On balance most successful airlines have either been wholly or part state-owned. You are right that there are countless examples of poor-managed state-owned companies as their are in the private sector.
What my over-arching argument has been is that just because a company has a Government as a shareholder does not necessarily make it bad.
On the Director issue I would say John Palmer has done a reasonable job at Air New Zealand, effectively appointed by the Government but in a process far different to they way directors were appointed to the board when BIL and Singapore Airlines has shareholdings in Air New Zealand. In those instances their appointed directors seemed to have a far greater allegiance to their appointers than to the good of the business in its own right.
“You ever worked in a crap company?”
Indeed I have both Government run and privately-owned, one was even *shudder* Australian. Right now my employer is pretty crap and makes seriously dubious business decisions but I am fortunate to have exceptional colleagues and have the opportunity to fly in one of the most dangerous albeit exciting flying environments in the world.
Vote:October 8th, 2010 at 8:51 pm
I guess we are creatures of environments, LeftPilot. While you have a lot more experience with airlines than I, I might have a bit more background in government and public policy. I completely agree that a company with a government shareholder will not necessarily be bad – it’s just I fear they are more often run badly than private companies for the incentive reasons I’ve described!
Best of luck with your current employer. Thanks for the chat – I enjoyed it (particularly our discussions today) and your perspective – one of someone familiar with airlines – does give me food for thought. Have a good one!
Vote:October 9th, 2010 at 6:19 am
And same to you sir.
Vote: