A recent public exchange between Elon Musk and Ryanair CEO Michael O’Leary over the implementation costs of Starlink’s WiFi service has reignited discussions about the necessity and affordability of in-flight internet connectivity in the airline industry. This confrontation highlights contrasting attitudes toward onboard WiFi between premium long-haul carriers and cost-conscious short-haul operators.
For airlines catering to premium travelers, the availability of reliable in-flight WiFi is increasingly viewed as a requirement rather than an optional amenity. Such carriers integrate seamless video calls and uninterrupted streaming into their service offerings to meet heightened customer expectations and loyalty program standards.
Conversely, budget airlines like Ryanair, whose operational model prioritizes minimizing expenses, see less justification in investing heavily in such technology. Ryanair operates over 600 aircraft and its CEO maintains that the operational and financial trade-offs of installing Starlink WiFi on its fleet do not currently favor this move.
David Whelan, an analyst at Valour Consultancy, notes that passengers on low-cost, short-haul flights do not anticipate the same level of in-flight services as those flying long distances. He suggests that if an airline’s primary aim is to provide efficient, low-cost point-to-point services, inclusion of in-flight WiFi may not be essential.
In the realm of traditional full-service carriers, consistent provision of WiFi has been a standard for years. However, demand has surged, especially since the pandemic, and along with the availability of faster, more reliable satellite internet options, more airlines have embraced high-quality connectivity services. Over the last year, several major airlines such as Lufthansa, Scandinavian Airlines System (SAS), and Virgin Atlantic have entered agreements to deploy Starlink or other competing satellite providers like Viasat and Intelsat.
Air France-KLM's CEO Ben Smith emphasizes that within markets such as transatlantic routes and the United States, onboard high-speed WiFi has evolved from a luxury to a required business standard to attract customers. Smith likens reliable internet connectivity onboard to the parity expected from a hotel, underlining how critical it has become.
Starlink’s competitive advantage stems partly from its use of lower earth orbit satellites, which reduce latency and enable continuous video-calling and live-streaming for passengers. SAS CEO Anko van der Werff, whose airline has recently subscribed to Starlink’s service, declared it the "gold standard" in inflight connectivity.
Implementing Starlink is a considerable investment, with costs estimated at around $170,000 per aircraft, according to Valour Consultancy’s calculations, which do not include hardware and installation expenses. Long-haul carriers can incorporate these investments into 'freemium' pricing strategies, offering complimentary WiFi to premium passengers while encouraging others to join loyalty programs through tiered access offerings.
Conversely, Ryanair's leadership argues that WiFi installation brings added weight and drag to aircraft, which has operational consequences such as increased fuel consumption. Musk dismissed these concerns, labeling O’Leary as an "utter idiot" via social media and jokingly suggested acquiring Ryanair to replace its management.
Michael O’Leary maintains skepticism about passengers’ willingness to pay even modest fees, estimated between 1 and 2 euros, for WiFi on short flights. Citing company data, he notes that fewer than 10% of Ryanair’s passengers would purchase such service, making the projected $150 to $250 million annual cost untenable. The only viable option for Ryanair, in O’Leary’s view, would be to offer WiFi free of charge onboard.