Report: Growth in southeast Asian airports to be driven by digital transformation

Frost and Sullivan has released a report on the future growth of airports in southeast Asia stating that it will be driven by digital transformation.

The report notes: “The economic progress of Malaysia and a growing middle class population in the country is leading to a steady growth in the demand for air travel.

This coupled with the growth of business and leisure traffic within ASEAN, between existing hubs such as KLIA, Changi, Suvarnabhumi, Soekarno Hatta and Ninoy Aquino airport brings more passengers for the intra-ASEAN network.

Travellers are self-connecting and preparing their own itineraries choosing which of these hubs they like to connect through when traveling further to North East Asia, South Asia or further down to Australasia giving preference to their convenience, comfort and overall experience while they transit.”

The context of increasing costs of operation; large capital layouts for construction and congestion at existing airports in the region offers a great opportunity for digital transformation, according to the report.

“KLIA1 and KLIA2 are the most mature ecosystems as airport terminals in Malaysia and they are at the right threshold to explore the full benefits of digital transformation of airports, whilst increasing efficiency, comfort and convenience at the same time delivering a unique experience”, said Amartya De, Associate Director, Aerospace & Defense Practice at Frost & Sullivan.

Increasing the operational efficiency and adopting digital transformation might hold the solution to manage within the constraints specially when adding more terminals or substantial expansion is not only expensive but also requires a long planning horizon.

Airports globally as well as in the region are being transformed by the ongoing digitization of processes, products and services, the enhanced connectivity of travellers and employees, as well as the evolution of big data analytics.

New digital solutions are being implemented, in order for airports to optimize processes, enhance business and operating models and improve customer experience.

However the pace of digital transformation differs greatly, depending on the airport size, location, operation and key internal and external stakeholders.

Budgets, ownership, stakeholder complexity, regulation, competition and expansion plans impact digital planning and the rate of adoption hence it would be unfair to compare one airport against another”, said Amartya De.

Most airports globally, are at an Airport 2.0 level which can be called as “data enlightenment” phase expected to continue till 2020. The journey from 2020-2025 will be a “data driven strategy” and finally between 2025-2030 as that of “data exploitation”.