Airline investment in IT is set to reach a new low this year as
airlines cope with huge financial losses, according to the 2009
Airline IT Trends Survey, co-sponsored by airline IT industry body
SITA and Computer Weekly sister title Airline Business.
Delegates at the SITA Air Transport IT Summit in Cannes today
heard that IT and telecommunications operating spend as a
percentage of airline revenue is forecast to be just 1.7%, the
lowest level recorded since 2002.
Airlines are seeking to reduce costs against a backdrop of
$10.4bn in losses last year and an IATA forecast of $9bn in losses
this year.
Many airlines are in "survival mode", said the survey, with 72%
intending to renegotiate IT supplier contracts and 70% planning to
invest in systems that lower overall enterprise costs.
Most airlines have already put in place measures such as
rationalisation of IT suppliers, IT infrastructure consolidation,
reduced head count and outsourcing.
Paul Coby, SITA Chairman and CIO at British Airways, said, "The
drop in IT investment by airlines is a direct response to the $80bn
in revenue that is expected to disappear this year from falling
passenger demand. For the first time in several years, there will
be a year-on-year decline in IT spend. The focus everywhere is on
doing even more with even less."
But Coby was keen to stress that IT was seen by airlines as an
essential tool to help them get out of the mess. He said: "Used
well and effectively, IT will cut costs and protect revenues. IT
has already accomplished a great deal in reducing distribution
costs and expanding self-service functionality."
Coby said technology growth areas over the next three areas
included IP telephony, service oriented architecture,
software-as-a-service, Web 2.0, cloud computing, data security and
biometrics.
The Airline IT Trends Survey polls senior IT personnel working
within the top 200 passenger carriers. This year, 116 airlines
responded.