Billion-dollar airline routes
travelstatsman.com
travelstatsman.com
There have been past attempts to harness the passive residual capabilities of air travel for photography, but none have stuck based on the difficulty of scaling such a system. If successful, crowdsourced aerial photography for cartography could add a layer of temporal resolution we just can't achieve with fewer than 500 imaging satellites currently in orbit, and for 1/10,000th the cost of satellite-based imaging. Add on concerns about LEO crowding and the thousands of use cases near-real-time aerial imaging could provide at a fraction of the cost, it becomes an interesting problem to solve.
There are plenty of barriers to this kind of scheme, regulation in particular, that could keep airlines from participating; the first major carrier who does, however, may find themselves with a new multi-billion dollar revenue stream.
(Disclosure: Founder @ https://notasatellite.com)
I'd imagine the customers here would be looking for a way to keep an eye on competitors? Ford would like daily overhead shots of GM's factories and parking lots, McDonalds would like to check on the length of average drive-through queue at competitors, etc? All in near-real time, without waiting for quarterly earnings.
On the other hand, weather might render this too unreliable for the needs of such customers - "how busy have the Bay Area Starbucks been since they've released their Pumpkin Spice Latte?" "Uhh, not sure boss, it's the 30th cloudy day in a row, we can't see anything".
I've been trying not to get too in the weeds with use cases right now as we're building because they really are endless, but supply chain intelligence and insurance are massive categories based on those who have expressed interest.
Weather is certainly an issue, but one that is shared with optical imaging satellites. SAR definitely helps with clouds and night shots, but with 100k flights per day the odds of getting at least one usable shot from a plane is far greater than a satellite due to revisit rates in orbit not matching weather changes in the troposphere.
I know of one market-maker HQ'd in Manhattan that currently pays $16 million/year for two satellite images per day of the oil storage tanks in Cushing, OK. Analysts determine tank volume by looking at the shadows cast by the floating lids on the tanks and use that data to set oil futures prices. There are roughly 1,500 flights over the same area every day. We're very much a hypothesis-become-startup at the moment but I'm optimistic!
Also, near real time HiRes images means a lot of bandwidth that you don't usually have in the air.
Our system is 100% internal which allows us to sidestep massive expense that comes with tunnel testing, retrofit, maintenance, etc. Customers using our Beta receive free in-flight wifi for recording out of their window seat for short increments during their flight. We cache the previous image and compare with the new image on the device itself, transmitting only the raw diff which dramatically lowers our bandwidth needs. All orthorectification and advance photogrammetry occurs on-ground, but we outsource a ton of that processing to the edge device.
We're also designing a physical hardware camera array that can be fixed to the window and is about the size of a headphone case. If you're interested in examples, our social media accounts are full of them: https://www.instagram.com/notasatellite/
1: https://www.oag.com/blog/billion-dollar-route-jewels-in-the-...
A few comments have mentioned the cost to the airline for running the route - the author talks about revenue, not profit - but most, if not all the costs are calculated on time, not distance.
Nearly everything in an aircraft has a maintenance window / shelf life measured in minutes / hours / days / months / years. The JFK - LON route could be 7 hours, or 5 hours depending on prevailing winds.
That’s an extra 2 hours you have to pay the flight crew, run the engines, maybe even an extra meal for the passengers and so forth.
Weather has an astounding affect on how much a given flight will cost, and probably traffic is the next one - hence why landing / gate spots at busy airports are so expensive.
Crew are legally mandated to only work X hours in a given time frame (both active and standby), so if you’re held up in the air or on the ground, especially on a long haul flight - you might not be legally clear to make that flight!
There’s a whole field of dispatch operations for aviation that handles this, and for the finance folks - the financial model for aviation is just subtly different enough to cause a few headaches if you’re not aware.
The post is similar to many things you read online (on HN or other places) it's really just 'infotainment' and it doesn't really matter if it's accurate anymore than a Netflix series might be.
Generally even articles by people that have domain knowledge can be just compounding of early errors or assumptions they make.
'Napkin math' though is always interesting because it would lead you to believe that if the numbers you are using don't make sense there is probably something you aren't considering that you need to think about.
They are expenses, and like all expenses they are the business's problem, not yours. Somehow, people are conditioned to think that they should pay the airline's taxes (some of them) and 'fees' for them, and somehow customers mentally remove that from the bottom line price. If only they could get customers to believe they should cover other expenses, like income taxes, fuel (oh yeah, they did that), maintenance, and lunch the other day with the Boeing salesperson, they could itemize those too. And where are the discounts when the expenses are less than expected? When profits are high? Oh, suddenly that's their business, not mine.
The pro tip is this, for anything: Just look at the bottom line. Businesses can itemize things however they want, including discounts ('special for you today - 50% off!'), the price of item A can be marked up, the price of item B marked down, it's all meaningless.
For example, it cost $950 to travel over Afghanistan in 2020. [1]
[1] https://simpleflying.com/overflight-fees/
Faa’s fees for the US: https://www.faa.gov/air_traffic/international_aviation/overf...
Seems fuel taxes are next to nothing? Not sure how to read this...
Since a plane can easily fly from country to country, any country who taxed airline fuel would simply deter planes from visiting.
Probably the biggest climate move that could have happened at COP26 would have been a global agreement on $1/liter aircraft fuel tax. But it didn't happen.
Carrying extra weight is bad and causes more CO2.
I don't understand that opening at all. We all want to get on so we get space in the overhead bins, don't we? Maybe he just never has a bag, but the reason should be obvious regardless.
That's a lot further than just stretching in the aisle..
I'm on the taller side and I apologize for any inconvenience, but I really do need to stretch. Those coast to coast flights will leave me paralyzed for days otherwise.
Depends. The bag can be under the seat in front, pulled up next to your own seat, or even in your lap. If it's under the seat it can be squished up, down, or sideways. If it's too big or overstuffed for that, then you can take one or two things out, or you can check a larger bag to keep the in-cabin one small. Not saying you should have to, but those are all viable alternatives to fighting for overhead space. I'm 6'2" with long legs for my height and I'm not young either, so I do know the struggle, but I used to travel quite a bit on six- and even ten-hour flights and I never felt like putting stuff overhead was an absolute necessity.
If you have a garment bag, I suppose that's a consideration, but I remember there always being "lay on top" free space in the overheads, even if full of bags.
Besides you can’t put stuff under seat in the exit row.
I think most are doing it for the overhead space, which leads to my misunderstanding. Why did they charge for checked bags. Its the more time-consuming option, who would pay for that.
they should be charging for overhead and offering checked bags for free. Pay for the time-saving
I'd guess it's for two primary reasons. 1: it takes workers to load and unload checked bags. Contrast to overhead where you are doing the work. 2: checked bags are pretty much unlimited. You can have several huge ones.
For some reason I was also under the impression that a checked bag was actually opened up and rummaged thru as well, hence the word "checked", but maybe I've just been misunderstanding?
No. Some people don't much care for the overhead-bin battle, bringing only under-seat baggage for shorter trips or under-seat plus checked for longer ones.
I always board as late as possible. Why sit in a hot/cold/stuffy plane while people jostle all around you?
As for getting my bag faster if it was gate-checked, how does that happen? Every time I've been gate-checked, my luggage ends up down in baggage claim the same as if I had regular-checked it. The only luggage that has met me at the gate has been a stroller.
Maybe I'm just flying cheap airlines, but I'll take first on and sitting in a stuffy plane over the chance of disaster and standing in the terminal any day of the week. You're waiting the same amount of time either way wherever you are.
But hey, your yin and my yang work great together, so you do you!
Popular business routes will always have full overhead bins, so you either check your luggage, bring a week-bag that you can fit under the seat, or get on early and get the overhead space.
Personally, I prefer to travel light so always wait until the last second to board. But that also depends on the cabin - if you’re at all above average height it’s absolute hell to fly in general, even worse when your limited leg room has a backpack.
Because I can get lost in my book and not worry about missing anything. YMMV (mine does).
Which is the same thing that happens with shrinkflation in packaging: the "half gallon" of ice cream that is actually missing 20% can be priced lower than the full half gallon. You don't have to fool everyone but just enough to raise your market share a little with your deceptively "lower" prices.
No. Overhead bins are terrible and bad. It baffles me that anyone would want to fight for overhead bin space. It's a terrible game, and the winning move is not to play.
I always gate-check my luggage if it won't fit under the seat in front of me.
That's not a given. At least as many times as not, I've gate-checked luggage and had to pick it up at baggage claim with everyone else.
Valet Checked bags use pink/red tags and are supposed to be returned on the jetway. It is supposed to be impossible for these bags not to be returned planeside, and are not supposed to get intermingled with the normally checked baggage. In practice I've seen this not work out first hand, with the bag ending up in baggage claim. (I've seen others say the same thing happened to them too. I suspect some airports actually have baggage handling set up to check for these if they get "into the system", and forward them to baggage claim, as the safest option.)
The good news is that if you travel a lot, you probably have status, and so you are one of the first to get on the plane.
Obviously the easiest is if you've only got a small bag and can fit it under the seat, in which case this question becomes moot -- but when you do need a bigger piece of luggage for whatever reason, gate-checking isn't such an obvious win.
I've watched the gate checked bags thrown down the chute, and missed, one too many times to ever gate check anything. Maybe a duffel bag of clothes, where nothing can break on the fall, but nothing else.
Same with standing up once we pull into the gate btw. 95% of people shoot out of their chairs the instant the seatbelt sign turns off, which is still 5-10 minutes from actual deplaning. I'm sure some of them are looking to stretch, but 95% of them? Even funnier are the middle and window passengers standing, but ducking under the luggage compartment at an uncomfortable angle.
That uncomfortable angle is often less uncomfortable than the seat is at that point.
Get on board, have a champagne, look at the menu, give the IFE a cursory glance to see if there any interesting new releases on
AOG (airplane on ground) is essentially a broken plane stuck at a gate getting fined massively by the airport because it is blocking a gate. In this situation, usually price elasticity of demand goes out the window with respect to airplane parts because what you'll pay in markup pales in comparison to what you'll pay in fines.
Is it more profitable to get new planes or run older ones into the ground? The answer to this question is beyond my depth.
Source: my first job out of school was SQL jockey for an airplane parts distributor running reports for the guys trying to predict which parts would be needed. The company had 4 guys and two vans on standby 24/7 to run parts to the airport. This was a very profitable business segment.
Here's the OAG report that's sketchily linked to a paywall in the article: https://www.oag.com/hubfs/Free_Reports/Busiest%20Routes/OAG%...
A more current snapshot from OAG: https://www.oag.com/busiest-routes-right-now
And finally, OAG's own blog post on billion dollar routes: https://www.oag.com/blog/billion-dollar-route-jewels-in-the-...
Basically it was only JFK-LHR before the pandemic. Most of the other high revenue routes are probably what you should expect, although I didn't expect SYD-MEL to be quite that high. I think maybe it's because the ranking is by airline and route and Qantas might dominate that route more than other airlines would dominate international routes.
Business class revenue is far more than economy revenue. Both by square footage and total absolute $. Then there’s cargo revenue.
The reason economy passengers get treated like crap is because economy passengers provide crap revenue.
On the same day I could have flown from Perth to Los Angeles return for $50 less.
It was rumoured that the two most profitable routes for Qantas in the world for nearly ten years were Perth to Port Hedland and Perth to Newman return, both Iron Ore mining hubs.
At one stage there were 6 flights a day to Newman 7 days a week for many years and never a spare seat.
Typical flight times 1 hour 20 minutes, cost of tickets around $1100 and nominal population of Newman is 4500 people...
Edit : these are all flights within the state of Western Australia