The New Reality for Customer Engagement
Though Terminal 1 has only been open since April, the GTAA already reports a 15 percent increase in passenger throughput, and it has reason to expect greater bottom-line results, too. At McCarran International Airport in Las Vegas, for example, Airline Systems Manager Dave Bourgon has likewise seen a 10 to 15 percent increase in passenger throughput, to the point where, he says, it's as if his airport had gained nine extra gates. Moreover, he adds, the common-use approach has saved the airport more than $3 million per gate since 1999.
Still, it remains difficult for airports with dominant airlines to make the move, and that's where Pearsonand its success in bringing along Air Canadaprovides hope. At Miami International Airport, Maurice Jenkins has been the manager of information systems and telecommunications for 16 years. For most of his tenure, Jenkins has eyed common use as both a solution for the inefficiencies of accommodating disparate and proprietary systems for multiple airlines, and also as a way to alleviate the stress caused by computer crashes and failed weather adjustments that can clog the halls with swarms of hot, unhappy passengers.
"Initially, when I first started thinking about this, there was no one out there to back me up," he says. "But when I found out that there are other people doing this, it validated my ideas. It was the light at the end of the tunnel." Jenkins has studied what Burke has implemented at Toronto, and tweaked it for his unique needs. Jenkins has yet to convince his biggest customer, American Airlines, to sign on, but he's optimistic.
"It's been a slow but steady move to common use," says Dick Marchi, senior vice president for technical and environmental affairs at the Airports Council International-North America, the largest division of the airport trade group that represents more than 550 airports around the world. Marchi notes that major hub airports like Dallas- Ft. Worth (American) and Chicago O'Hare (United) will likely be the last ones to make the switch, because the hub airlines often control entire terminals, and they're in no hurry to share with their upstart competitors. Plain old inertia can prove a formidable obstacle, too. "It's starting to happen faster now," says Marchi. "I would say that Jim has moved the shared-infrastructure model ahead half a football field length."
Burke's impact on the airline industry may be more far-reaching than he could ever imagine. When the federal government deregulated the airline industry in 1978, a move that met with decidedly mixed results, a common complaint from would-be competitors was that the skies had been deregulated, but not the ground. By opening to the free market a business that had been managed by the government, deregulation brought lower prices and higher productivity throughout the airline industry. But deregulation also left the airports with a few major airlines that could dominate their hubs with near-monopoly status. With the advent of common-use airports, however, the long-awaited arrival of a truly competitive airline industry could be upon us. This could give discount upstarts such as Southwest and JetBlue even greater odds against the struggling incumbents, but either way it should improve the experience for travelers.
At the end of the day, Jim Burke isn't comfortable taking credit for such sweeping change. The common-use system at Terminal 1 is only three months old, and there is still much to be done. Burke is still noodling with an effective way to offer Wi-Fi service in the airport without causing too much wireless interference, and he wants to integrate RFID into the baggage systemsomething he hopes to accomplish within five years.
Aside from emerging technologies, Burke is also concerned with the viability of Air Canada. In bankruptcy protection since April 2003, Air Canada narrowly escaped liquidation this May when it concluded acrimonious negotiations with the Canadian Auto Workers Union (which represents about 6,000 of the carrier's customer-service personnel), and received an extension from the courtsto Sept. 30for its re-emergence. (On August 15, Air Canada's creditorsowed $9.5 billion dollars U.S. when the carrier filed for bankruptcywill vote whether to proceed with the plan or not.)
Air Canada's Segaert remains convinced that the new system will help the airline recover. "I only pay for what I consume," Segaert notes, "and normally when you shrink, you have to pay to remove yourself . . . this way, we just pick up and leave." Meanwhile, if Air Canada were to liquidate, the GTAA could have dozens of other airlines filling its gates and ticket counters in short order.
All of this uncertainty plays on Burke's mind as he stands in the main hall of Terminal 1 and watches passengers catch an Air Canada flight to the west coast. His voice grows quiet as he slips into problem-solving mode. "Now if I can just get the customs, air-traffic control and other government agencies tied in together on the network, we'd really see some progress."
Dan Briody is a former senior writer for Red Herring magazine and author of The Halliburton Agenda: The Politics of Oil and Money.
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