Global Eagle, a provider of satellite-based in-flight entertainment systems for airlines, has tapped Dave Davis as CEO.
A former veteran of the airline industry who was instrumental in the merger of Northwest and Delta airlines, Davis had served as chief financial officer and chief operating officer of Global Eagle Entertainment over the past year. With his new post, he also becomes a member of the company’s board of directors, effective immediately.
Davis’ promotion comes as carriers around the world are in the midst of upgrading their in-flight entertainment options — either by installing new seatback screens, handing out tablets or adding Wi-Fi that enables passengers to access video and audio content on their own mobile devices.
The upgrades are providing Hollywood’s studios with more opportunities to generate revenue from their film and TV libraries, especially as airlines are touting on board entertainment options in their marketing materials as a way to fill more seats. The in-flight entertainment biz is expected to generate $2 billion to $3 billion a year in the coming years, according to analysts.
Whereas well-branded rival Gogo relies on air-to-ground technology with antennas mounted on the bottom of planes, Global Eagle’s service connects with satellites during flights from the roof of the jet, enabling Wi-Fi, audio and video streams to be accessed while on the ground, over water and in foreign territories.
Global Eagle Entertainment was recently formed through consolidation of content and connectivity businesses Row44 and AIA. In addition to distributing entertainment, the company can also handle e-commerce duties and original content development.
Former MGM chairman Harry Sloan and Winchester Capital’s Jeff Sagansky tapped the markets in 2011 to raise $190 million for Global Eagle Acquisition and moved into in-flight entertainment in 2012 by acquiring U.S.-based broadband service Row 44 and Germany-based content supplier Advanced Inflight Alliance in a transaction valued at $430 million.
While Southwest does not, a majority of Global Eagle’s customers offer seatback screens on their planes and are now seeking faster Wi-Fi services to distribute entertainment.
Films are typically sold as packages — international carriers like Emirates can have as many as 200 to 300 titles on board — which adds up to several thousand dollars of programming per aircraft each month.
“Regardless of whether anyone is watching, the studios are getting paid,” Davis said.
American Airlines, Southwest Airlines, Emirates Airline, Norwegian Air Shuttle and Etihad Airways are among Global Eagle’s 150 airline partners.
Global Eagle isn’t looking to become a consumer brand like Gogo; its customers are preferring to promote their respective airlines, instead.
In Southwest’s case, Global Eagle built the online destination through which Southwest offers up movies and TV shows, for example. The customer only sees the airline’s logo or promotional partner, not Global Eagle’s moniker.
Davis replaces John LaValle in the CEO role. LaValle will continue to consult for the company.
“Given his experience in the airline industry and his operational and financial leadership at GEE, Dave is clearly the best person to drive continued growth and transformation across our business,” said Ed Shapiro, Global Eagle’s chairman of the board. “He is a proven leader with deep industry knowledge, business vision and the ability to foster collaboration among our talented team of employees across the world. He has been instrumental in driving the formation of GEE and the subsequent integration of our acquisitions, and he has the skills to accelerate GEE’s innovation in the in-flight entertainment and connectivity industry.”
Before joining Global Eagle, Davis spent nine years at Northwest Airlines, serving as executive VP and chief financial officer. He also was senior managing director of Perseus, partner and co-founder of Bearpath Capital and chief financial officer of US Airways and Kraton Polymers.
“This is a very exciting time for GEE as we utilize our global footprint to offer airlines a groundbreaking combination of content, connectivity and digital media services,” Davis said. “In order to capitalize on the opportunity ahead of us, we will concentrate on executing our strategic plan to grow our international base of customers, fully integrate our operations and further strengthen and expand our product offering.”