Amidst COVID-19, A New Airline Industry Forcast Estimate a $460 Million Decrease in Airline IT Revenues by 2025 -- Frost & Sullivan

Frost & Sullivan’s recent study, Analysis of the Global Airline IT Market, Forecast to 2025, finds that the increasing expectations of passengers are compelling airlines to embrace digital enablers and propelling a digital transformation journey that will fundamentally change traditional airline information technology (IT) strategies. Impacted by the COVID-19 pandemic, the airline IT market is estimated to generate a revenue of $20.74 billion by 2025, compared to $21.20 billion in 2019. As per the original forecast, by 2025, the market was estimated to reach $25.1 billion from $21.20 billion in 2019.

“Despite the adverse impact of COVID-19 on the industry, airlines are increasingly focusing on adopting next-generation digital solutions such as mobility, machine learning (ML), Big Data analytics, and artificial intelligence (AI) to identify cost-saving and revenue-generating opportunities,” said Abhilash Varkey Abraham, Aerospace & Defense Research Analyst at Frost & Sullivan. “Additionally, a few major airlines have already committed to migrating their entire IT infrastructure to the cloud over the next 3-5 years and this trend is likely to continue and grow, mainly among low-cost carriers.”

Abhilash Varkey Abraham,

Frost & Sullivan

Abraham added: “From a regional airline IT market perspective, North American airlines were the highest revenue contributor in 2019 and are expected to remain so during the forecast period. Further, APAC is expected to be the key growth engine over the medium and long terms.”

With global airlines losing $25 billion due to disruptions in operations and with 50% of them addressable via digital solutions, a huge opportunity exists for IT suppliers to innovate and expand their portfolio. Market opportunities include:

• Real-time data analytics with an interactive display/graphical user interfaces (GUI) will have higher penetration in the medium term, which will serve as a growth opportunity for suppliers.
• With airlines embracing the capabilities of next-gen technologies such as AI and ML, solution providers are encouraged to integrate these technologies into their solutions.
• Vendors are encouraged to develop solutions to solve airlines’ disruption pain points, especially in the areas of passenger re-accommodation and compensation.
• Adopting Big Data platforms can streamline the operations of airlines, reducing cost and time.