Air New Zealand phone hijack is a rort

Air New Zealand is testing something which I view with grave concern.

They are testing a system that hijacks cell phones on their flights, and charging extortionate data rates along the way.

The proposal is to place a mini cell-site inside the aircraft, and have it connect to satellite.  Any calls or data traffic made during the flight would attract roaming rates which are beyond the standard international extortion:

  • Calls will be $3.50 per minute
  • Inbound calls will be $2.00 per minute
  • Data will be $20,000 per Gigabyte
  • Texts will be 80 cents to send

The calls are expensive, but we want calls to be short up in the air, and given the noise of an aeroplane and the discomfort that fellow passengers will project to loud callers I see little issue here.

However beware your teenage daughter texting her mates as you wing your way North – 30 texts will leave you $24 short

But it’s data that is the problem. Let’s look at a sample flight. If you leave your cell phone on then receive a call ($2 if you hang up within 1 minute), send 4 texts ($3.20), check out the news on a few websites  (say 10 pages at 1.2 MB = $240) and update your copy of an iPhone app (say Penultimate at 16.5MB, or $330) then you’ll be up for $775.20. That’s all possible within the space of a few minutes, and it shows the ludicrous nature of those data charges.

Don’t even think about tethering or using your T-Stick or Vodem. If you happened to receive an automatic OSX or Wndows update that was just 100 MB then that’s $2,000 thanks. Getting an updated movie from iTunes syncing across in the background? That’s about 1.5 Gb and a cool $30,000 thank you very much.

This isn’t just a rant as I use a lot of data. The average amount of data consumed on one mobile network in NZ (not sure which one), reported by Akamai, is 481 MB per month. Do that while flying with Air New Zealand’s new system and that will cost you $9,620.

This is not about safety

A decent percentage of pasengers leave their phones on during flights – it’s proof that phones out in the passenger section don’t really impact the flyability of the plane, especially larger ones, and that we’ll never get everyone to switch off. This is not the purpose of the exercise, and many people have realised that there are patches of cellular access on many domestic routes.

Why this matters

Passengers that leave their phones on now risk data being transferred and calls arriving while they are otherwise sitting in their pocket or suitcase.Welcome to an unexpected bill.

Other passengers could see that their phone was working and then start surfing away, thinking that $20 per MB sounds cheap. It’s not – it is  rort.

Vodafone and Telecom will look terrible in this exercise, as they are the ones that have to bill their customers. The customers will complain, the satellite provider will demand their money and Vodafone and Telecom will be stuck in the middle.

The transition moment is important. When does the in-air service take over from ground? Before takeoff? during takeoff? Is there an announcement? If the system was always on then passengers doing last minutes texts and tweets would be unexpectedly stung, and even people outside the plane could be affected.

Above all Air New Zealand has committed to treat us like friends. Friends don’t present each other with bills of this size.

We want to be nice to each other when we fly, and we are increasingly online when we sit down. But these prices are driving us to yak on the phone instead of quietly surfing.

How to solve it

1: Announce the prices each and every flight, and announce them in correct terms – as in $20,000 per Gigabyte.

2: Change the prices to be reasonable. Virgin America charges US$4.95 for all you can eat on flights less than 1.5 hours. I’d pay that. You can even get a $40 monthly pass. I’d pay that too. It’s actually only $19.95 for a 30 day pass for handheld devices, and I’d certainly pay that.

3: Make sure that phones are not automatically roamed onto this system. Customers need some warning before they do anything, whether it’s voice, data or text. The warning should apply to all three configurations so that we are fully informed whether we are using a T-stick, iPhone or regular phone.

About Lance Wiggs

@lancewiggs
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35 Responses to Air New Zealand phone hijack is a rort

  1. Nic says:

    You forgot one scenario – reading your books on a Kindle, automatically synchronising with the Amazon site.

    Like

  2. Ben Kepes says:

    Lance – I very much doubt that the roaming would be automatic. Logically it would be like when roaming internationally where users can chose to roam or not.

    Like

  3. mikea says:

    I doubt there would be a single person outside of airnz that wouldn’t agree with this post…

    I would have thought this was a good chance for them to differentiate themselves as a premium airline. I’m a regular business traveller, flying multiple times a month to Australia and back. We’re a small-ish privately owned company that doesn’t have a prefered airline. So I choose my airline based on the price, taking into account the services offered for that price. Its rare that I can justify the price difference between Air NZ and the budget airlines, so I often fly with the budget airlines – even since the advent of AirNZ’s so-called “Seat” option (that the in-flight staff are still struggling to implement – I’ve been given a few meals that I shouldn’t have and practically been asked to give back a half-eaten meal a few minutes later…)

    Anyway I’d probably choose AirNZ over the budget airlines if they offered data at a reasonable date so that I can work while flying. Doesn’t have to be cheap, I understand that they’re a monopoly up there – but neither should it be so expensive that the only customers they will get are celebreties tweeting about their flight and those you point out will forget to turn their smartphone off…

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  4. Tim Newman says:

    Good points but, think about this, you are hurtling along at 780 km/h 8230m above ground in a thin aluminium fuselage with two turbofan jets strapped to the wings producing thousands of pounds of thrust. While you nibble on your peanuts you’re able to make a call you your mother about dinner arangements via an intricate piece of electronic equipment which links to a satellite placed in a low spacial orbit.
    We truly live in amazing times!

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  5. Ian Simpson says:

    I assume there’s a minimum charge of 1MB too (please correct me if I’m wrong, but generally the case) so forgetting to turn roaming/data/whatever off on your smart phone will sting you $20 as soon as it checks your email (which most do every couple of minutes).

    Air NZ seem to have changed strategy over the last year or so to become a budget airline. We’ve seen them trying to force insurance on you (whether or not you’re eligible for it), offering seat only fares (despite having a far lower carry-on baggage allowance than the European budget airlines), and pinning on a credit card surcharge (which Mac users can’t get around).

    Trying to squeeze more dollars out of you in-flight is the next step. I was on a Ryanair flight from London to Dublin in December. In this 45 minute flight they tried to sell me drinks and snacks, duty free stuff, Christmas gifts, a calendar, and then tried to get donations for a charity for anyone who hadn’t already spent all their money. At this rate it seems this is where AirNZ will be in not too long…

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  7. Dominic says:

    The comparison to Virgin’s in-flight prices is unfair. Virgin uses a plane-to-ground based system that only works in the continental US.

    Air New Zealand will be using the Inmarsat satellite network. This means it’ll work in the middle of the Pacific Ocean, but it also means they’ll be paying something like USD$16.69 for a *single minute* of 256kbps data (for example: http://www.wcclp.com/serviceIn.asp)

    Like

    • Alex says:

      Should subscriber really be bothered what technology is used? Subscriber needs fast connection for reasonable price (both are impossible to assure with Inmarsat).

      So, why not to use new technologies, that can do speed and price?

      Like

  8. Nick M says:

    You should note in your point 2 of how to solve it that those prices are in USD, while the rest of your article is NZD. A bit misleading otherwise.

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  9. AaronM says:

    It’s even worse than that; it’s actually $20,480 per GB of data (there is 1024mb per gb). Yeouch!

    I flew Air NZ from Wellington to Auckland on Friday night, and they said we could turn our phones on whilst the plane was still taxi-ing around the runway. Normally they don’t let you do it until the seat belt sign comes off, which happened 10-15 minutes later. Cunning plan to get us into the habit?

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    • Lance Wiggs says:

      The local/AirNZ rule i that once you are off the landing runway you can turn on mobiles. I’ve often seen the person making the landing announcement time it perfectly so that she mentions phones just a the aircraft turns. This is a concern but my hope is that the service would be switched off before landing.

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      • Rob says:

        They probably don’t make much money on the flights due to competition, so they have to make money elsewhere with the addon services, where there is no competition.

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  10. CJ says:

    I think we definately need answers from AirNZ on when they turn their ‘machines’ on. Surely it will only be for the period in the air when you are allowed to turn your phones on.

    This is going to be a real issue for smartphone users that ahve push emails. Turn on your phone to send a quick text saying when you will be landing (expect 80c charge) and end up with an extra $20 as you BB or iPhone cheaked your emails.

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  11. Aaron Hodder says:

    You missed one “How to solve it”

    4. Turn off your phone before you board the plane

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  12. Pingback: Surely AirNZ wouldn’t rort Kiwis « Red Alert

  13. Lance,

    By focusing on a per GB rate you are comitting the same statistical deception Air NZ are.

    Using the 481 MB per month (assuming a 30 day month and 16 hour day) is about 1MB per hour. So AKL-WLG would run about 1.5MB?

    It might balance your graph a little if it also included a “Poll your email server a couple of times for text only emails” at 1.5MB

    Peter

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  14. Rich says:

    The data price isn’t that much out of line with Inmarsat’s raw prices in the $6k per gigabyte range:
    http://www.wcclp.com/serviceIn.asp

    My Android defaults to not use data service when roamed – don’t all phones?

    Like

  15. Rob says:

    I can just imagine duing the rugby world cup that there will be visitors wingling that they have got huge bills after flying on our planes, and that won’t look good for NZ, as those stories will be broadcast around the world. I compare it to those people who were trying to rent out their houses for huge money during the world cup, in that it doesn’t reflect well on NZ.

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  16. Louis says:

    I don’t think its entirely excessive whilst this technology is in its infancy.

    Even if you have a smart phone downloading emails whilst you’re in the air – emails are typically no larger than 2-4KB ($0.039 – $0.078). Unless you’re stupid enough to leave your phone downloading images, doing updates, etc without first asking permission.

    Like all things – It starts expensive until economies of scale kicks in. Costs will always be passed onto a consumer at an increased rate. These increases are not that steep when you take into account the data cost of a satellite connection.

    Additionally – satellite’s are slow. Do you really want that ass-hole in the seat in front of you torrenting and rendering the connection unusable because they’re not thinking twice about using bandwidth. Or that guy at the back watching YouTube videos whilst you have an urgent business email that needs seeing too.

    200 KB is plenty of bandwidth to check emails throughout a flight I’d pay $3.90 for that. Don’t assume that you need 20GB to check your emails – That’s just greed.

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  17. Joel Pitt says:

    People seem to be so entitled these days.

    Yes it’s extortionate, but I’ve been in hotels that are close to that and countries that have similar costs for calls and texts. And those are not even satellite connections in a freaking plane!

    If you try to upgrade an app on roaming charges then you deserve to pay ridiculous amounts. You’re using a limited connection being shared amongst all other passengers. Hog the bandwidth, get burnt.

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    • Lance Wiggs says:

      Louis “you’re stupid enough to leave your phone downloading images, doing updates, etc without first asking permission”

      Yes I’m that stupid, or more to the point email contains images etc that we have no control over. The 10 latest emails in my inbox this morning are 1.806 MBytes, which would cost me $36.12 on a flight. Except that there were a bunch more emails, and goodness knows what else that went straight to spam. One spam email was 16.5 Kb – that’s about 33 cents. Clipping the emails to stop overly large ones may prevent some fees, but email tends to make it up on volume – especially if your phone is catching up with your computer. No thanks.

      Joel The issue is that we are not in an expensive hotel, or Mozambique or even Australia. We are in New Zealand, on a domestic flight in a situation where we do not expect to be stung. So you’d be ok if your child downloaded all updates to app on your iPad? That’s $2000 thanks.

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  18. Louis says:

    Lance – my point clearly is asking how crucial is that photo in your email is.

    You can set your phone up to download emails via text only and get it to request permission for an image. I do this on a daily basis purely for the fact I don’t need to clutter my phone and I can flick between emails faster. I don’t need the latest office photo of John in accounting last friday on my phone – I can wait until I’m sitting at my desk.

    “Joel The issue is that we are not in an expensive hotel, or Mozambique or even Australia.”
    Think of this logically and over simplified.

    Expensive hotel has a landline/fibre/cable (a physical cable run to the building) traffic over this is next to nothing as the requirements are a box at each end. They can often charge up to $15,000 per GB (and I’ve been in these Hotel’s).

    Now you’re on a plane, you’re using a satellite connection. You’re connected to something 800-2000Km above you whilst you rocket along at 400kmph. You now need equipment to broadcast and receive signal at both ends wirelessly. Not only that – Satellite’s aren’t cheap, they are a scarce resource.

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    • Lance Wiggs says:

      The Satellite industry is bragging about Ka band satellites that have 100Gbit.sec capacity, and when Australia gets their NBN show on the road then the prices should drop. But that is in the future, and for now we are stuck with outrageous costs.

      But the focus here should not be on the costs. The focus of this piece and everybody is on the price to the consumer, which is ludicrous.

      While some technically savvy people might have the knowledge and discipline to reduce the size of their inbound and outbound communications, most people do not. The overall problem here is that Telecom, Vodafone and 2Degrees will be sending bills for tens, hundreds or even thousands of dollars to people that are not expecting them and cannot afford to pay them. None of those carriers and certainly not Air New Zealand will win.

      It seems clear that satellite access at these prices is unsustainably high and will result in more backlash than positive karma. Clare Curran’s initial reaction and then horror once she realised the actual costs is a good example of what every person flying will go through.

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  19. Dylan Reeve says:

    I think it’s a little unfair to beat up on Air NZ (or perhaps more accurately Vodafone, as they are the service provider) – they are beholden to the technology that’s available to them, which at this time is Inmarsat where they will pay per-minute for the data/voice carrier as well as per-MB for the data traffic that is carried.

    While we can’t know exactly what they commercial realities are of their service with Inmarsat, we do know for sure that it’s about the most expensive way you can connect to the internet – but it’s also currently about the only way to get a cellular service to work on a plane.

    This is not like Air NZ and Vodafone are just using the normal Vodafone network and sticking a bloody big markup on it, it’s a very different technology.

    I’m sure with scale and maturity the price will get better, but for the moment that’s what it will cost. And for many business people it will be more than acceptable.

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  20. Louis says:

    If you’re afraid of technology and unwilling to LEARN how to use it then don’t – your choice to be left behind. Technology is the way of the future, if you are unable to learn how to do something as simple and disabling images in an email you’re going to struggle indeed.

    Truth is you can save bandwidth on your phone by disabling images, stopping updates etc. The prices are not that high and the satellites using 100Gbit/s speeds will most certainly not be the ones over New Zealand anytime soon. New Zealand is too small for such technology to be profitable here.

    The problem with people now is greed. New technology is expensive so you can bloody pay for it, just because you THINK its a rip-off doesn’t mean that it is. People today are so full of entitlement its ridiculous – you’re entitled to NOTHING unless you work & pay for it.

    This service is provided out of good will NOT a requirement. Put your phone in flight-mode and quit complaining – greedy people such as yourself are never happy. Think you can do it cheaper – propose a business plan to Air NZ (off course that would require you to first LEARN how much it costs).

    Don’t like it – don’t use it. Stop complaining and stop getting in the way of developing technology, you’ll only ever lose.

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    • Welly says:

      Louis, the point everyone is making is that all your suggestions require a conscious effect to do, when you have other more important things on your mind, and may not remember to do all those steps. It also removes features of a smart phone, such as html emails, which require images to be enabled. Remembering to manually disable all those things before you go on a flight is inconvenient and even the most technical knowledgeable person may not remember to do all those things. You then have to rememeber to change everything back again, and all those steps take a lot of time. You may forget to turn off your phone and have it in your suitcase in the cargo hold, and it could be running up all these charges if it is set to autoupdate.

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  22. Welly says:

    I think this is a good reason to use prepay, so you can’t run the risk of running up these huge charges.

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  23. Louis says:

    Your points are flawed

    HTML emails can have images disabled.

    Up until now you’ve always had to turn off your phone whilst in flight. Now you’ve got the option to leave it on – its a crisis if you get charged for it.

    If you want to be billed and if you’re stupid enough to leave your phone on – who’s fault is it?

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  24. Ben Kepes says:

    Let us be clear here. Travelers will need to switch their phone off on takeoff and make a conscious move to turn them on once cruising altitude is reached.

    That being the case, any claims that travelers will be “surprised” by roaming charges lose credibility as in order to be “surprised” you have to make the conscious decision to turn your phone on.

    Of course for all those bad people who leave their devices on while taking off… but then again that’s against the law so doesn’t count, right?

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    • CJ says:

      Ben – I think you have pretty much got it right.

      The only issue is those naive smart phone users who turn on their iphone/bb to send an 80cent text and dont realise that their email is pushed to them. I can see the arguments now – “but I didn’t check my email!!!”

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    • Welly says:

      Yeah, but what if you put it in your luggage and forget all about it and it has been left on. It is not as though you can go into the luggage hold to get it mid flight. I think it has been proven that mobile usage on a plane does not cause any safety issues with planes, which was possibily the reason for the law. Same with mobile use in a petrol station, they are urban myths.

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