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Message: Mezzo Movies: IFE one-stop shopping for new-entrant airlines

Mezzo Movies: IFE one-stop shopping for new-entrant airlines

posted on Feb 27, 2005 10:35PM

February 28, 2005 – BRITISH company Mezzo Movies is aiming to catch the new wave of low-fare, regional and leisure carriers interested in IFE by offering turnkey packages designed to generate “significant and sustainable” revenue streams.

Set up in 2003 by two former executives of Tesco, the multi-billion-pound British supermarket chain, London-based Mezzo wants to help carriers who are new to IFE by applying proven best practice from the retail industry to the supply of equipment, content and supporting services.

With offices in central London, the Mezzo team comprises five people with expertise in retail, consumer product development, finance, IT and logistics. Mezzo is partnered with British IFE content post-production company Phantom Media - a total of eight people, each with over 20 years’ experience of supplying content to airlines around the world – and has relationships with games companies such as Miniclip.com, which specialises in games for the Internet.

“Airlines who want to start selling IFE have to climb a very steep learning curve if they are to succeed,” says chief executive David Sampson, former head of strategy for Tesco’s online shopping operation. “We know that simply choosing a particular IFE system and playing films will not guarantee the sort of returns that are possible. By bringing the best retail practice to onboard entertainment we can turn what has traditionally been a cost for airlines into a substantial revenue and profit stream.”

Mezzo maintains that getting revenue from renting handheld devices is not as straightforward as it might seem. “Our retail approach focuses on the detail,” says Sampson. “That includes things such as such as ensuring the passengers are well aware of the service before they board, and the cabin crew are able to provide the devices quickly.”

Advertising also represents a potentially valuable new source of revenue that can offset the cost of providing IFE. “We will find new advertisers in a way that won’t cannibalise existing in-flight magazine revenue,” Sampson declares. “Moreover, handheld devices offer a new and quite different mechanics for advertisers that can be far more compelling than off-the-page delivery.”

The company is offering what it describes as a fully managed and completely outsourced solution. “We cover all the services needed to sell IFE quickly, effectively and profitably in every sector of the air transport industry,” says Sampson.

The Mezzo method thinks the process through from the initial creation of the business model and the passenger proposition (content selection, user interface design, pricing and passenger research) all the way to the hoped-for outcome - viewing statistics, monthly sales reporting, revenue shares, reports on system performance and recommendations for future developments.

In between, Mezzo and its subcontractors would handle necessary but labour-intensive functions such as passenger communications (check-in, gate and onboard point-of-sale materials, direct marketing through existing airline channels, and onboard public address announcements), acquisition and management of advertisers, and training and motivation of staff.

On the hardware side, Mezzo is focused on the new handheld systems – APS/Wencor digEplayer, IMS PEA, Astronics (ex-GD) YES – while passengers’ own portable devices, including laptops and PDAs, would also be accommodated.

“We are handset-agnostic,” says Sampson. “We don’t sell the devices - we will work with the airline to select the most appropriate. All three handsets are excellent, offering a real choice to airlines.” Mezzo’s own content management platform can automatically deliver encrypted digital entertainment files in file sizes and formats to suit the end-device, according to the company. The Mezzo service could include the selection and purchasing of devices and onboard content loading stations for the airline, and inventory management, maintenance and repair.

Content management services could include encoding and encryption, supply and operation of a content management platform, and automated content acceptance, distribution and upload to passenger devices.

The Mezzo content management platform is designed to automate the process of content loading to and data retrieval from the handheld devices, using encrypted files only. “Network delivery of content is important to minimising costs as well as enabling content to be refreshed as frequently as necessary,” Sampson observes. “It will allow us to quickly replace content that is unpopular - a key way of ensuring that what the passenger sees remains appealing.”

Mezzo is determined to provide the most appropriate content package for each airline. “Get it wrong and passengers won’t want to use the service and the profits rapidly disappear,” says Sampson. “Get it right and it can be very profitable, which is why we take an analytical approach to content selection. Passenger profiling is a standard tool, but we go much further by using the research techniques that made Tesco successful.”

The company is working with Phantom Media and others to create an entertainment package that includes games and online gambling – “Though we do recognise that gambling has had a bad press in the world of IFE and may not appeal to all airlines.”

Mezzo is looking to Phantom to choose the most appropriate content and to accommodate a wide range of languages – “This is an extremely important aspect of being able to offer compelling passenger propositions for international carriers.” On the games side, Mezzo is working with a number of companies, each with its own strengths. “For example, the very simple games that Miniclip.com develops really suit short flights and are easily played by youngsters and adults alike,” says Sampson.

Once a basic offering had been defined, Mezzo would develop, manage and report on an in-service trial and use the results to refine a definitive solution. Mezzo has already presented to a number of airlines - low-cost operators, regional and full-service carriers - in the UK and the USA, and describes the response as encouraging. “Airlines quickly see that our approach is different and relevant,” says Sampson. “We have several trials planned for the first half of this year.”

http://www.shephard.co.uk/inflight/D...

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