Ever since Apple released the first version of the iPad, the device has found its way into more parts of our lives. Even if you don't own an iPad, there a good chance you know someone who does or know a company using them in their business. While iPads certainly have their limitations, the easy mobility that comes with them has made them very appealing to airlines.
Long-distance flights are a source of boredom and discontent for many passengers and airlines have been trying various techniques to solve this problem. But the latest in in-flight entertainment involves bringing entertainment to directly to passengers' fingertips.
As part of a cost-cutting and selective expansion strategy, Air Canada (TSX:AC.B) has launched a new low-cost subsidiary airline called Air Canada rouge. By using older aircraft, packing seats tighter, and paying lower wages compared to mainline Air Canada, Air Canada rouge is targeted toward routes deemed unprofitable for mainline Air Canada.
But management wants Air Canada rouge viewed as a different, cheaper experience, not an unpleasant airline of last resort. It tries to personalize entertainment by allowing passengers to stream it to their personal iPads.
Although not everyone has an iPad, Air Canada rouge will rent you one for C$10. This strategy offers both the positive of providing additional services to passengers while also opening up another stream of ancillary revenue for Air Canada rouge.
Air Canada's not the only one to use iPads as a device for passenger entertainment. Southwest Airlines (NYSE:LUV) is making iPads available for checkout on three of its busiest routes. This iPad lending is being done in conjunction with its ongoing promotional relationship with DISH Network (NASDAQ:DISH). DISH intends to have ambassadors on hand where the iPads are being lent.
The partnership between Southwest Airlines and DISH Network is a mutually beneficial relationship, helping both companies as well as airline passengers. Southwest gets to provide a better passenger experience that keeps passengers happy and coming back. And DISH Network gets bored airline passengers to sample its services.
Taking care of business
Airlines aren't just using iPads for passenger entertainment. Despite the up-front cost, some airlines are using iPads to cut costs. JetBlue Airways (NASDAQ:JBLU) has given its pilots customized iPads eliminating the need for many manuals and paperwork in the cockpit.
Air Canada has also brought iPads to the cockpit to reduce manuals and paperwork. All this paperwork reduction has a benefit in reducing one of the largest costs in the aviation industry. Air Canada's manuals weigh around 35 lbs. each meaning a long-distance flight requiring four pilots could have a weight reduction of more than 100 lbs. by switching to iPads. Additionally, iPad manuals at Air Canada and JetBlue can be updated electronically rather than having to insert and remove physical pages.
Technology in flight
New aircraft get the biggest attention among aviation technology followers, but the integration of small pieces of technology goes directly to the business strategies of airlines. The portability of the iPad has allowed airlines to better the passenger experience while cutting fuel costs through weight reduction.
Alexander MacLennan owns shares of Air Canada. This article is not an endorsement to buy or sell any security and does not constitute professional investment advice. Always do your own due diligence before buying or selling any security. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.