Airline industry to invest just 1.8 per cent of revenue in 2010

By Martin Courtney
25 Jun 2010 View Comments
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Paul Coby
Paul Coby: ATI companies need to work together to build interoperable IT systems

The Airline IT Trends Survey 2010 published this week suggests that airline operational IT spend will represent just 1.8 per cent of revenue in 2010, flat year on year, giving IT vendors selling into the industry little cause for optimism.

Many airline systems remain locked on legacy mainframe systems and databases, with cost-saving consolidation initiatives such as virtualisation and cloud computing – which have been widely implemented in other industries – having made little impact so far.

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These large-scale infrastructure upgrades are being delayed in favour of low-cost software implementations around check-in and ticketing applications for mobile devices, as well as improving aircraft supply chain management, and adding social networking elements to web services to streamline operational costs and steal customers from rivals.

“It is the lack of executive support which is critical – IT projects need the blessing of the CFO and the CEO or they face an uphill battle,” said Henry Harteveldt, vice president and principal analyst at research company Forrester. “It is hard to get funding for basic things, let alone new technology challenges.”

British Airways CIO Paul Coby also sits on the board at SITA – a specialist airline travel industry ICT provider. He argued that ATI companies need to work together to build interoperable IT systems and applications on common standards, which will help passengers get through airports more easily as well as streamline cargo, baggage and aircraft engineering operations.

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