Managing Airports

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Solution OverviewNot so long ago, airports would have been characterised by government ownership, lack of competition, large inefficient work forces and outdated technologies. With these factors effectively acting as a brake on performance, making money was a goal that was largely out of reach. Despite this, airports were still expected to meet the parallel demands of delivering step change improvements in safety, security, service and capacity.

The aviation market today is very different. Industry evolution and privatisation has seen airports – whether owned privately or by a local authority – become more commercially focused in a bid to improve profitability and stakeholder return. New technologies have been adopted, processes re-engineered and automated, and workforces empowered, as operators strive for recognition as the ‘airport of choice’ for airlines, concession holders and the travelling public.

Today airports can help grow airline market share, increase passenger numbers and drive commercial revenue by providing a cost effective and efficient service to airlines, developing offerings that meet concessions needs and providing a highly satisfying experience for passengers. Cisco® solutions have been at the heart of this transformation – underpinning new operating models, changes in process and improvements in productivity.

But airports are continually having to ‘up their game’. While efficiency gains remain a key focus, new sources of income must be found. Challenges, such as heightened global security and rising fuel and energy prices – combined with environmental issues, like global warming and noise pollution – are driving the need for a new, broader wave of investment. As a result, IT has become intrinsically linked to all aspects of airport operations – from building and tarmac management, ground transport and ground handling through to passenger operations, security, retail services and business communications.

For some time, Cisco’s Connected Airport architecture has allowed airports around the world to use the network as the platform to provide the optimum common use infrastructure for all of these airport functions. Connected Airport Operations, a new value proposition developed by Cisco and our industry partners, is the natural evolution of the network as the platform; allowing business processes now sharing a common infrastructure, to be connected together in ways that were previously not feasible. This capability underpins the transformation of airport business processes and the development of potential new revenue streams.

Managing Airports for Profit and Shareholder Value

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Designed using best-of-breed solutions, Connected Airport Operations is the natural evolution of the Connected Airport philosophy which continues to provide a framework to promote efficiency and reduce the complexity and cost of IT and operations.

This paper examines how Connected Airport Operations can help achieve the airport’s need for security and business transformation, while also ensuring the best possible customer experience and attainment of financial objectives. This vision is realised by using the network as the platform to unite and optimise the entire spectrum of operations and then – by utilising Web 2.0 technologies and Cisco partner integrated solutions – to maximise the shared use of information and resources across all airport functional groups. This next phase of airport evolution – moving from common-use infrastructure to connecting airport operations and optimising business processes – is illustrated in Figure 1.

By using this approach, airports can start to turn information into a valuable resource and create new revenue models. For example, whereas in the past CCTV images were the sole property of the security department, converged IP CCTV systems sitting on the network platform allow the images to be accessed anywhere across the airport estate. If these images can help an airline or ground handling company to optimise its operations and reduce costs, they have a value and can offer a revenue source to the airport and potentially change the way in which these organisations work.

Similarly, the Airports Operational Database (AODB) provides a comprehensive repository of valuable information. By allowing access to this data, via the network and a secure portal, airports can benefit from new collaborative opportunities, for example, with vendors offering a wide range of solutions to airlines, ground handlers and retail tenants. Again, as well as creating a potential new revenue stream, this also provides an opportunity to transform how the airport as a whole might operate.

This same philosophy of shared use of information and equipment is applicable to many other resources and applications. Whether it is tying the physical security or telephones to the Time and Attendance system, or the airport’s operating procedures to control room consoles, this integration of ‘knowledge’ will allow the airport community to optimise its operations, while efficiently providing alternative revenue streams or value added services to airport clients.

Business Drivers and Operating ModelsAir travel is a vital part of a modern day lifestyle and a global economy. It brings people together, moves product worldwide and ensures the significant contribution of travel and tourism to GDP1. The challenge for airports – many of which are at, or fast approaching, capacity – is finding ways to accommodate more planes and passengers while, at the same time, working towards providing a more effective, secure, less costly and increasingly passenger-friendly environment. First and foremost, however, they need to make money before they can invest it.

Managing Airports

1. GDP is a measure of a nation’s economic performance, based on the market value of all goods and services produced within the boundaries of a country.

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Figure 1. Connected Airport Operations: The next phase of airport evolution

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To meet this multi-faceted challenge, airport operating models must achieve the highest return possible from the following three areas:

• Aviation revenues

• Commercial revenues

• Cost savings.

Aviation Revenues These are the charges, or levies, placed on airlines for the use of the airport and its facilities, and includes:

• Landing and take-off charges (typically calculated by aircraft tonnage)

• Additional chargeable services (for example, passenger charges, security charges, aircraft parking, aircraft push-backs, ramp and baggage services, toilet and water services, ground power units, air start units, catering, freight loading/unloading2).

Growing these sources of income is not easy. They are based on the number of airlines and aircraft that the airport levies charges on. Typically government controlled and capped, they have a direct impact on the airline’s business and are routinely and rigorously challenged. Unless they see value for money, airlines will tend to (separately or collectively) lobby government to exert pressure on airport operators. This can create acrimony and even legal disputes, and be a drain on airport management time and resources. In some instances, airlines have even elected to relocate their operations.

New airport operating models counter this by improving quality of service, enabling increased throughput of planes and passengers. In the process they help airports to build a stronger case to legitimately review charges and levies, as well as providing an environment conducive to attracting new airlines and expanding routes.

Commercial RevenuesThese come primarily from:

• Passenger services: Many airports have successfully adapted to grow existing commercial revenue streams and create new ones. Passenger services include traditional Global System for Mobile (GSM) communications and wireless access. More recently, these offerings have been augmented with entertainment and information services.

• Concessions (rent): Chargeable rent is largely dependent upon on the volume of business that the concession holder can generate. In order to achieve full rental potential, the operating model must motivate people to spend more time and more money at the airport. Rather than offer concessions for retail and dining, many airports have recognised the potential for creating their own subsidiary companies to provide these services. As with concessions, increasing footfall and spend is fundamental to revenue generation. Similarly, parking, concierge and car hire companies will all expect to make a decent return for the rents they pay.

• Service provision: Service provision is becoming a key revenue component. Potential sources include ground transport (charges, concessions and licensing), advertising, voice services (telephone, ground radio and air-to-ground radio), wireless access (laptop, handheld, RFID3 and location-based services), secure LAN access and bundled IT services.

• Consultancy: Having developed their knowledge and in-house resources, airports are also successfully exporting these skills. For example, Munich airport’s model now includes consultancy services, which it provides worldwide for IT, aviation, operational readiness and airport transfer related projects4.

Managing Airports

2. Source: Exeter Airport, Schedule of Fees & Charges, 1st April 2007.3. Radio Frequency Identification (RFID) incorporates devices, such as RFID tags, and the use of radio waves to store and

remotely retrieve data.4. http://www.munich-airport.de/en/business/branchen/consult/index.jsp

Cost Savings In the world of the airport operator, efficiency means improved processes, reduced costs and fewer penalties – which is an area that continues to bite hard. In the UK, the Civil Aviation Authority (CAA) recently announced its plans to increase the maximum level of rebates for poor service performance from three per cent to seven per cent of total airport charge revenue (up to around £60m/€76m at Heathrow in 2008/09, and £15m/€19m at Gatwick)5.

Privatisation (or preparation for privatisation) has helped promote a ‘mean and lean’ philosophy through the adoption of commercial business practices, staff rationalisation and cost efficiency programmes. The role of the IT department is fundamental to making this approach work, both in terms of providing a contribution (for example, reducing total cost of ownership and CAPEX) to any savings targets and rolling out technology that enables other airport business groups to increase efficiency. Cisco refers to this approach as the Connected Airport model – the use of IP as the foundation to digitise information, automate processes and drive productivity.

Examples of cost savings include:

• Consolidation of infrastructure/migration to a common platform: reducing IT management, maintenance, training and support costs

• IP telephony: reducing call charges and the cost of moves, adds and changes (MAC)

• Common User Terminal Equipment (CUTE)/self-service check-in: reducing staff numbers, making more efficient use of resources and aiding passenger flow

• CCTV rationalisation: providing access to a single CCTV system with cost-effective IP cameras for shared use by multiple control rooms

• Green IT and building management: lowering energy usage and waste management costs.

The next stage of business evolution and efficiency gains will come from the Connected Airport Operations model – processes improvements made as a direct result of the ability to share information and resources that were not previously accessible to all stakeholders.

Examples of potential opportunities to change business processes include:

• Use of CCTV / Video images to increase the visibility of airline and ground handling operations: Based on the accessibility of IP CCTV images across the airport for any stakeholder and the incorporation of these images into management and communications systems

• Use of AODB data to add a layer of intelligence to passenger information systems: Connecting AODB to digital media display systems can ensure that appropriate languages are displayed; appropriate information is provided and targeted advertising shown.

As web 2.0 technologies are adopted and vendors recognise the opportunities to incorporate information or to access resources, more solutions aimed at changing the business processes will become available.

Why Cisco?Whether investment is aimed at increasing aviation or commercial revenue or at reducing costs; Cisco solutions based on the Cisco Connected Airport architecture or Connected Airport Operations, offer potential improvement to the bottom line. Through an investment in understanding airport operations in detail, Cisco and our partners have developed solutions that allow the airport to drive:

• Process change through provision of new tools and information

• Improved service to passengers, concessions, contractors and airlines

• Shared use of scarce and expensive resources

• Maximum return on investment through service provision to airport clients.

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Managing Airports

5. http://www.uk-airport-news.info/heathrow-airport-news-201107.htm

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Investment and IT Priorities There is general consensus now that airports require massive capital investment in infrastructure over the next five years if they are to keep up with predicted rising passenger levels, while minimising flight delays. A study by the North American branch of Airports Council International6 found that US airports must invest US$7.4 billion into new runways, terminal buildings, cargo facilities and other construction projects to meet the future needs of air passengers. The study also predicted that travellers will experience worsening delays unless increased investment is provided for capacity, safety and security facilities at airports.

The latest Airport IT Trends Survey7 shows how airports are embracing the use of new technology to adapt business processes and utilise their existing airport capacity more efficiently. Importantly, the survey highlights how the role of the IT function is moving beyond ‘tactical plumbing’ to ‘strategic importance’ as IT becomes more closely aligned with airport operations – in particular, to improve passenger processing, passenger services, airport operations and security (see Figure 2).

Over the next two years, airports plan to implement new technologies, particularly in the area of passenger self-service and shared-use systems, such as remote passenger check-in, common bag drop and Common Use Self Service (CUSS) / Common Use Passenger Processing Systems (CUPPS). The survey also confirmed that an increased number of airports are intending to deploy biometrics in some form, as well as addressing traffic and aircraft movement growth by improving airside operations.

Made with the Industry for the IndustryCisco’s solutions reflect these priorities. Based on a strategy of teaming with best-of-breed industry partners, Cisco designs and delivers solutions that are proven to meet these demands. Cisco today supports the critical operations of many of the world’s leading airports, providing peace of mind that their investments are protected against technology obsolescence by its ongoing programme of research and development.

Managing the Transition to Connected Airport OperationsTo help airports realise these goals faster, Cisco has joined forces with other industry leaders – such as SITA, IBM, Intermec, AeroScout and Tyco Fire & Security – to develop the roadmap: Connected Airport Operations .

Managing Airports

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Figure 2. Top IT priorities for Airports

6. Source: Airport Capital Development Costs for 2007-11 study, ACI-NA, 2007. 7. Source: Airline IT Trends Survey, SITA, 2007. The annual survey represents over 191 airports worldwide and more than

half of the top 200 airports by traffic.

Connected Airport Operations combines a highly scalable core IP infrastructure (Cisco’s vision of the Connected Airport) with powerful industry solutions to help airports maximise profit and shareholder value and meet the parallel demands of safety, security, service and capacity.

This is achieved by optimising performance in the following key operational areas:

• Building and tarmac management

•Ground transport

•Ground handling

• Passenger operations

• Security

• Retail services

• Business communications.

This roadmap is based on a four-step approach comprising:

Step 1 – understanding the business

Step 2 – laying the foundations

Step 3 – airport solutions

Step 4 – post implementation services.

In addition to the key areas listed above, this core Cisco infrastructure and the Connected Airport operations approach can be extended to improve the efficiency of airport freight/cargo operations8, banking/finance or the communications, back office systems and processes that support other airport business group functions.

Step 1 – Understanding the business: What does the business look like, where does it want to go?Building a network that underpins an airport’s business objectives is less about routers and switches and more about developing a clear understanding of what business objectives the infrastructure must underpin. Cisco’s experience shows that the chances of success are greatly increased through early involvement in helping to develop this vision and the systems, solutions and applications needed to achieve these business objectives.

Cisco and its partners provide consultancy services that allow us to understand the business and to propose a network strategy that will fully align with the airport’s business objectives. These services include:

• ROI Models: to support the business case process and financial analysis

• Professional Services: pre-implementation services, planning, design, testing and so on

• Cisco Capital funding models: options for financing (sale and lease back), helping safeguard against technology obsolescence (technology refresh), and cash flow management (capital expenditure to operating expenditure, deferred payments, etc).

Step 2 – Laying the Foundations: IP Network as the PlatformToday IP lies at the core of the airport business. Almost every airport process and most airport systems depend on the IP infrastructure. Not only must the network underpin existing requirements, it must also be capable of expanding to meet the airport’s future operational needs and the service needs of its tenants, airlines and retailers.

Cisco MultiProtocol Label Switching (MPLS) technology lies at the heart of 21st century networking and is the architecture of choice for many of the world’s leading IP service providers. The same achitectures have been developed to address the unique needs of airport networks, incorporating wired and wireless elements, unified communications, voice, physical security and digital media as well as many other components.

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Managing Airports

8. The Cisco Connected Warehouse solution ensures complete interoperability with unified communications and warehouse and logistics applications – from instant messaging, IP voice and video telephony, and rich media conferencing to warehouse management systems, RFID, and mobility applications.

Cisco’s airport solutions are network centric – whether in the office, terminal, or data centre. A Cisco IP platform ensures complete interoperability with unified communications and airport management systems – from instant messaging, IP voice and video telephony, and rich media conferencing to RFID, security and mobility applications – and puts them together in a way that enables airports to improve the efficiency and effectiveness of operations. This shared services model is illustrated in Figure 3.

In addition, Cisco Service-Oriented Network Architecture (SONA) allows connected airports to leverage – rather than replace – existing IT investment. Built into all interconnected components9 this core foundation facilitates the airport IT services model by providing the capability to offer ‘bundled’ IT services, securely delivered over a VLAN / VPN10. It also helps to drive down operational costs through standardisation of common IT services – such as security, mobility and storage – and facilitates a move to a shared infrastructure model with other organisations.

Cisco’s IP-based communications transforms the way organisations operate in an environment where real-time voice, data and video communications is critical. The power of Cisco’s networking technology enables airports to keep its staff and stakeholders effectively connected anywhere, anytime and offers the opportunity to drive the maximum efficiency possible through interconnection of these technologies.

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Managing Airports

Figure 3. Connected Airport Operations: An example of IP Network as the Platform

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9. For example, Cisco Routers and Switches.10. Virtual Local Area Network.

Step 3 – Moving beyond Routers and Switches: Airport SolutionsDeveloped over years of working closely with the industry, Cisco’s traditional network elements have continually evolved to keep pace with the changing needs of airport and aviation customers. From routers and switches capable of handling unique protocols to highly secure Payment Card Industry (PCI) compliant architectures, network security and storage devices, this core Cisco technology (illustrated in Figure 4) continues to underpin new operating models, new processes and improvements in productivity.

A Cisco Connected Airport using common infrastructure benefiting from MPLS, L3 VPN and other advanced technologies enables high business performing, extremely secure networks for all the airport tenants. It is based on Cisco Validated Designs11.

This IP Network architecture comprises:

• Access Layer – Access on the edge is provided through standard Cisco Catalyst 3750 Series Switches, which deliver high performance and world-leading security features.

• Distribution Layer – The distribution layer aggregates nodes from the access layer, protecting the core from high-density peering. The distribution layer provides a logical isolation point between different access layers and the core using, for example, Cisco Catalyst 6500 Series Switches.

• Core Layer (Not shown in Figure 4) - the core is formed, ideally, of two DWDM rings with two CRS/high end routers on each ring. Cisco 7600 Series Routers will be divided into two groups, a group dual homed to one ring and the second group dual homed to the other ring.

Recent Cisco innovations that expand on the core MPLS network include:

• Cisco 1800, 2800, and 3800 Integrated Services Routers (see Figure 5): a cost-effective yet scalable router with rich features, such as built-in security, security device management and Power-over-Ethernet (PoE) functionality

• Cisco 3200 Series Wireless and Mobile Routers : Ruggedised routers, providing a secure IP network platform for vehicles, trains and buses – whether stationary or in motion – extending voice, video, data and airport applications to mobile staff

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Managing Airports

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Figure 4. Example of Core Cisco Connected Airport Infrastructure

11. Cisco Validated Designs consist of systems and solutions that are developed, tested, and documented to facilitate faster, more reliable, and more predictable deployments. Cisco Validated Designs are documented in three formats: Design Guides, System Assurance Guides, and Application Deployment Guides.

• Cisco IE3000 Series Industrial Ethernet Switches : Specifically designed for harsh environmental conditions, provides integration with industrial equipment, plant, substations and intelligent transportation systems

• Cisco Catalyst Switches: Strengthen the network infrastructure by delivering integrated security services, high availaibility, application delivery optimisation, and simple management operations.

But Cisco solutions are not just for IT departments. More recently, Cisco has broadened its focus and extended its portfolio in order to make the benefits of IP convergence more widely available to other parts of the airport organisation. These enhancements – discussed in further detail over the next sections – have been developed in collaboration with Cisco’s ecosystem of leading technology partners to deliver the vision of Connected Airport Operations, and include:

• Cisco Unified Communications: Integrates communications more closely with business processes, ensuring that information reaches people and devices every time and everywhere, through the most appropriate medium.

• Cisco Digital Media System: A flexible and comprehensive solution for digital signage and desktop video that makes it easy to create, manage, publish and access high-quality digital media for compelling communications.

• Physical Security (including CCTV): Cisco video surveillance software and hardware enables faster incident response, investigation and resolution by providing secure access to live and recorded video – anywhere, anytime – from a broad range of devices.

• Cisco Unified Wireless Network: The complete core infrastructure (see Figure 6) of access points, WLAN controllers and control systems for secure, wireless and mobility services.

– Cisco Motion: Creates the ‘context-aware’ mobile network with the capability to simultaneously track thousands of devices, for example, for high-value asset tracking, IT management and location-based security.

• Cisco Connected Real Estate: Enables disparate building and energy management systems to be monitored and controlled over a single IP network. These solutions ofer significant CAPEX and power savings, helping to support the airports Green credentials.

Step 4 – Post Implementation ServicesTo reduce risk and further decrease total cost of ownership, Cisco and its partners have developed a range of post implementation services. These services are designed to help airports ensure effective management of the network services required to maintain high-quality network performance while controlling operational costs. The following services are available to help airports manage large or sophisticated networks that are critical to airport operations, shorten problem-resolution time, and accelerate access to industry leading specialists:

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Managing Airports

Figure 5. Cisco Integrated Services Routers and Cisco Unified CallManager help ensure optimal voice quality across the WAN / Man

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Managing Airports

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• Cisco Software Application Support Services: Covers more than 100 Cisco software application products in major technologies, strengthening the availability, reliability, and functionality of Cisco software applications.

• Cisco Focused Technical Support Services: Three levels of dedicated high-touch operations management, technical support and engineering services.

• Remote Operations Services: Proactive remote monitoring and management practices to support availability, security, and reliability

Conclusion Connected Airport Operations is designed to help airports manage for profit and shareholder value. It provides a path to achieve the highest return possible from aviation and commercial revenues, while finding new ways to do more for less. By using the network as a platform to unite operations and implement these best-of-breed solutions, airports can realise the benefits from:

Operational Efficiencies• Flexible check-in and gating capabilities that ensure better use of space and minimise

congestion for passengers

• Improved visibility, work scheduling, and communications that speed-up ground handling operations and reduce aircraft turnaround times

• Increased efficiency of merchandise receipt, put-away operations and dispatch, optimising inbound and outbound airport freight operations

• Centralised monitoring and control, for example, of servers and heating ventilation and air conditioning (HVAC) plant, helping to reduce power consumption and drive down the production of carbon at source (by utilities)

• Simplified IT management, helping to lower TCO

Figure 6. Cisco Unified Wireless Network provides indoor and outdoor wireless infrastructure

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Managing Airports

• ‘Lean management’ of assets and airports equipment

• Real-time ‘track and trace’ capabilities for baggage12 and freight

• The ability to deliver the right information, to the right person, in the right format, at the right time, improving physical security, decision making and response times

• Tighter access control, in-line baggage screening13 and authentication (using the infrastructure to support biometrics14) of staff and passengers

• Faster passenger processing through rapid deployment of passenger-centric services and facilities, such as CUSS kiosks15 and remote check-ins16 and baggage drops17

Revenue growth• New mobility services (‘pay-as-you-go’ Internet, games and entertainment services)

• Re-usable check-in desks, gates and retail space increases rental opportunities

• Digital signage allows greater coverage and makes it easier to message, thereby helping to grow income from advertising

• Higher customer satisfaction and retention rates

For Further Information

Please contact transport@cisco.com

The 2007 Airline IT Trends Survey by SITA confirmed that:

12. Baggage tracking services are offered by 30 per cent of respondents while 37 per cent intend to introduce them within the next two to five years;

13. In-line security baggage screening systems have been introduced by 63 per cent of respondents while 20 per cent intend to introduce them within the next two years;

14. An increased number of airports are intending to implement biometrics in some form;15. Common-use Self Service kiosks have been introduced by 27 per cent of respondents while 54

per cent intend to implement within the next two to five years;16. Remote (off airport) passenger check-in has been introduced by 28 per cent of respondents

while 42 per cent intend to implement within the next two to five years;17. Common bag drop locations are available on airport from 18 per cent of respondents while 50

per cent intend to offer this service within two to five years;

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