Messaging in the Aviation Sector/Industry May 2020

It’s more important than ever to reduce TCO post Covid-19 The Global Pandemic caused by SARS-CoV-2 since the end of 2019 is causing greater economic and societal disruption than any event since World War II. The aviation industry is one with very high fixed costs. Even with the most drastic measures no will be able to survive a 90% drop in revenue for more than a few months. In the short-term to medium-term, businesses in the aviation industry must reduce the TCO (Total Cost of Ownership) to survive and emerge from the shutdown in a lean and cost-effective way based on service value rather than maintaining a status quo. Type B Messaging is a considerable element of that operating cost, seen to be ~$0.51 USD per passenger trip and today this needs to be significantly reduced to have a positive impact on the overall company balance sheet.

“Are you OK paying more Introduction & Overview of Type B Messaging than $100 USD per Aviation Industry usage, its underlying technology megabyte of E-mail that Before the early versions of the Internet (originally known as ARPANET) ever existed, the aviation industry your business sends” had developed a means to perform data transfers globally via proprietary networks. This was driven not only by the expansion of and operators moving into every corner of our world, but by the need to manage their operations and interact with their business partners better. The International Air Transport Association (IATA) assigned the name ‘Type B’ to the format of such messages. Type A is the real-time interactive communications based on IATA legacy protocols, and the transmission of these exchanges has become known as messaging. The use of Type B Messaging predates e-mail by many decades and is still very much in use today despite numerous predictions that the Internet would obsolete the need for such proprietary mechanisms. Other industries also maintain similar networks such as the financial industry’s SWIFT network. Type B is primarily used by the air transport and travel-related industries. Type B is mainly communicated over private networks operated by ARINC and SITA, but in recent years, various third-party solution providers have developed internet-based solutions which interconnect to the two legacy providers or smartly bypass them using direct VPN based Internet or peer-to-peer links. Usage of Messaging in Airlines The aviation industry began using teletypewriter technology in the early 1920s using radio stations located at 10 airfields in the United States. The US Post Office and other US government agencies used these radio stations for transmitting telegraph messages. It was during this period that the first federal teletypewriter system was introduced in the United States to allow weather and flight information to be exchanged between air traffic facilities. While the use of physical teletypes is almost extinct, the message formats and switching concepts remain similar. In 1929, Aeronautical Radio Incorporated (ARINC) was formed to manage radio frequencies and license allocation in the United States, as well as to support the radio stations that were used by the emerging airlines, a role ARINC still fulfils today. ARINC is a private company originally owned by many of the world's airlines including American Airlines, Continental Airlines, British Airways, , and SAS. ARINC is now owned by Collins Aerospace. 1. Aviation Sector In 1949, the Société Internationale de Télécommunication Aeronautique (SITA) was formed as a cooperative overview and history by 11 airlines: Air France, KLM, , , TWA, , British Overseas Airways Corporation, British South American Airways, Swedish AB Aerotransport, Danish Det Danske Luftfartselskab A/S, and Norwegian Det Norske Luftfartselskap. Their aim was to enable airlines to be able to use the 2. What is wrong with existing communications facilities in the most efficient manner and thus SITA was founded as a not-for- the solutions used profit organisation. After World War II, there was an increase in the number of commercial aircraft operating, and these aircraft today? were capable of flying greater distances than in the past. As a result, the Aeronautical Fixed Telecommunication Network (AFTN) was implemented worldwide as a means of relaying the air traffic communications, sometimes through the use of radioteletype which had become common among military 3. There is a better way! forces in the 1940s.

Today the airline industry continues to use teletypewriter messages over ARINC, SITA or AFTN networks as a medium for communicating via messages. Most teletypewriter messages are machine-generated by automatic processes. IATA standardised teletype message formats throughout the airline industry through its Air- or Cargo-Interchange Message Procedure. The initial form of Type B has been around since the early 1960s, evolving from teletype technology (TTY) originally developed for railroad use more than 100 years ago, and is used heavily within the aviation What is Type B ecosystem. There isn’t an airline/operator, aerospace manufacturer, civil aviation authority, caterer, airport, ground handler, application service provider or global distribution systems for airline ticketing which hasn’t Messaging? been using Type B for decades. The system is in no danger of being mothballed any time soon. There are simply too many legacy processes tied to this mechanism, with the costs of change being exorbitant. Type B messages are renowned as highly reliable and secure (due to the closed networks and use of a Other messaging technology in which data packets sent are acknowledged and have error detection) and support mission- critical applications such as: protocols used today • Cargo tracking and manifests for Ground Handling and Customs purposes • Aircraft maintenance information and ACARS messages • Airline industry’ procurement and repair transactions for aircraft (ATA’s Spec 2000 standard depends heavily upon Type B messages) • Passenger booking/reservations and check in and departure control data • Aircraft flight plans and air traffic control data • Weight and load-balancing information 1. IATA Type B – TTY • Baggage tracking and tracing information, including RFID tag support • Advanced passenger information (API) and which is communicated to governments Industry standard • IATA clearing house data messaging protocol and There are five main providers in the industry today (plus AFTN), being by size, SITA, ARINC, Amadeus, EDIfly and Lufthansa Systems, estimated to be supporting the following daily volumes of messages delivered: format • SITA: ~35 million • ARINC (Collins Aerospace): ~30 million 2. IATA Type X – XML • Amadeus: ~15 Million • EDIfly: ~5 Million • Lufthansa Systems: ~3 Million Evolution of Type B to a • AFTN: ~2 Million modern XML structured Adding all of the providers volumes of Type B message delivery together, and based on an average message size of 175 characters, the total annual market size is estimated to be 6e1012 characters a year or 6e106 message MCM a year and at the average cost per MCM (Millions of Characters per Month) would be $900 Million USD – 1.05 Billion USD a year of industry cost. 3. ICAO AFTN Underpinning Technology and Restrictions Aeronautical Fixed Telecom Being a legacy format, Type B has a strict layout as opposed to more recent types of data and formatting (like XML which carries message payloads, HTML which primarily is concerned with the visual representation Network (Used for critical of a webpage or application, and SGML which concentrates on how markup languages are used to structure documents). station messages) Type B is deliberately restricted to a maximum “message” length of 60 lines of 63 characters each, with a limited set of allowed characters (only capital characters A to Z, the numbers 0 to 9 and the three signs /, - and .). This restriction was driven by the early teletype character sets from which Type B emerged. As well as the line and character limitations, each message must be limited to less than 4 kilobytes of data based on >$1 Billion USD of the lowest common denominator principle, being TTY. While this rigidity is detrimental to expanding the capabilities of the standard, it also provides the industry Type B Messaging with a convenient short-hand means of distributing data around the world easily, making it ideal for mission-critical processes. Users need to trust such data, so the trade-off is well worth the drawbacks. In fact, without such a trustable form of global data exchange, it would be nearly impossible to operate a cost to the modern airline in today’s business environment. aviation industry A message itself is not difficult to decipher once you master the lingua franca (and there is really not much need to do so, since software and service providers handle the creation and conversion of data as needed). and increasing. Type B in itself is a “store-and-forward” mechanism in which message senders transmit their data via their service provider, who in turn archives the message for X days (typically seven, but this depends upon your service contract) and sends it off directly to the recipient you specified, or to a gateway provider if the

recipient is not on their network. The service providers have contractual agreements to guarantee message delivery in such instances, and if for some reason the message fails, it can be re-sent a number of times Given the size of the (hence, the store-and-forward feature and concept of PDM (Possible Duplicate Message) header). The technology utilized to support Type B Messaging today has evolved from distributed fully customized aviation industry switching architecture supporting legacy ALC, AX.25, X.25, TCP/IP using BATAP (type B Application To Application Protocol) to MATIP B and now MQ as the message brokering capabilities. Each are still present in today at 4.5 Billion parts of the global aviation industry to some extent, with the main protocols being TCP/IP MATIP B and MQ- passengers, this Series. Ultimately, we use the evolution of Type B in all of our day to day lives, as Type B Messaging was the equates to ~$0.22 foundation for X.400 messaging, which led us to E-mail using SMTP and other E-mail protocols. USD per passenger boarded or $0.51 USD per passenger trip

PCI/DSS compliance and Security end-to-end certification is critical Security end-to-end has never been more critical, with the increases in requirement around PII (Personal Identifiable Information), through GDPR (General Data Protection Regulation) and PCI/DSS v3.2.1 (Payment Card Industry/Data Security Standard) where PAN and associated PII “We need to maintain cannot be stored or transmitted in an un-encrypted or un-masked form. PCI/DSS compliance and These restrictions are critical to maintain certification and compliance under PCI/DSS and certification at all costs, GDPR. The certifications enable merchants (Airlines) to be able to transact purchases through providers such as Visa, Mastercard, Amex and others securely. Lack of certification for an as running business Airline removes the capability to transact purchases electronically and disables all e-commerce without this is nearing bookings, which of course is becoming a major source of booking revenue. impossible in this API Type B Messaging contains clear text PII and PAN details, and thus puts pressure on certification. economy”

What are the Key Challenges? Key Cost In todays’ API/Digital economy the thought of consuming bandwidth based on a cost per megabyte of data is unfathomable, Challenges not to mention when that cost of transmission of data is sometimes as much as $3,000 USD per megabyte. However, with 1. Cost of delivering large the average seen as $150-175 USD per megabyte of data, imagine (and growing) volumes of if you were sending a 12 megabyte email (not un-common) over such a network, that one email if sent to 10 recipients would messages equate to $18,000 to $21,000 USD at average cost levels. Even at 2. Security end to end – $30 USD per MCM, this would still equate to $3,600 USD. This is PCI/DSS clearly unsustainable. Given Type B is essentially E-mail with an added security layer of complete store and forward capability, the 3. Reliability and rapid real cost of Type B data transmission therefore should be delivery marginally higher than E-mail is today. 4. Messaging Flexibility - Security The Type B networks today, have some clear deficits in the area of Translation of messaging security of transmission of data/messages, where the following highlight the key in-securities: from one format to another 1. End-to-end encryption for PII protection 5. Order of message delivery. 2. PCI/DSS Compliancy and Certification

3. Address spoofing protection

4. Billing signature spoofing Reliability Type B networks today are seen as batch-like non-real-time delivery networks, with the inherent design being based on IATA targets of hours and days for delivery. Reliability of access maybe confirmed under a network SLA, but end-to-end delivery times of messages are a rarity. Message Translating Type B messages to other formats such as E-mail, FTP, database read/write and Type X are limited and specific for each flexibility connection, where multiple connections are required to deliver total flexibility, and in the legacy providers the flexibility is wanting. Order of Order of message delivery is especially critical in availability recaps, as this creates the correct order of additions and message deductions of availability levels within inventory of airlines. In the delivery traditional networks where performance is driven by multiple end- to-end channels, sometimes delivery order is not completely secured, which has significant business impact to the airline

How can EDIfly help you? What can To address the challenges of the industry in emerging from Covid-19, EDIfly has a forward-looking plan to assist aviation industry customers to reduce the dependence EDIfly do on the legacy incumbent industry messaging providers, who are seen to be in 2020 cost in-competitive. for you! EDIfly is offering the aviation industry an alternative model to control the cost of Type B Messaging and the TCO associated with it to competitive market levels 1. Reduces the cost of expected from technology in 2020. delivering large (and The EDIfly commercial model is a subscription model, where the customer subscribes growing) volumes of based on a simple yearly flat rate charge which allows the customer to send and messages through receive as much Type B traffic as the business requires. This includes all messaging (any channel, protocol, interface including translation services) that the customer can fixed annual consume on a peer-to-peer basis within the EDIfly community. subscription pricing. EDIfly is also offering a try-before-you-buy #tryb4ubuy model, whereby the customer 2. Provides full end-to- can become accustomed to the capability of the EDIfly services prior to commitment end security in contract. addressing PII and What can EDIfly do for you! PCI/DSS requirements. 3. Increased reliability EDIfly addresses all of the Key Challenges for the industry, through through multi server • Cost and TCO – for Type B through the unique pricing model outlined above environment and rapid • Security – EDIfly is the only solution today that can be GDPR and PCI/DSS peer-to-peer delivery. compliant and certifiable as encryption end-to-end including into the application of customer is included. As well EDIfly allows for control over 4. Translation of most address spoofing and signature spoofing. messaging formats to • Reliability – EDIfly being a software subscription model, allows for the many others customer to build as much reliability into the hosted platform as is deemed dynamically and in by the business through full cluster / failover capability between multiple gateways and automatic fallback to legacy circuits. one gateway. • Flexibility – EDIfly allows for full flexibility and multi-channel support with 5. Guaranteed order of full translation locally, to allow for a local message broker between systems delivery of all internally in the customer site. Also transparent to the EDIfly peers, so messages message delivery end-to-end has dynamic translation based on the configuration used in both the sending and receiving customers. This includes support to translate Type B to Type A and vice versa. • Delivery Order – EDIfly guarantees the delivery order through end-to-end sequencing of messages even in multi-channel and multi-gateway implementations and with peer-to-peer communication, there is no need for multi connections to achieve performance levels. This is due to localised acknowledgement removing end-to-end latency impacts. EDIfly • EDIfly, uniquely allows seamless integration and additionally provides full self-administration capabilities and complete transparency on performance and message delivery with full reporting capability, so no longer a Innovative Software s.à r.l. requirement to rely on costly vendor produced reports. 27, cité Holleschberg, L-5831 Hesperange, Contact information Grand Duchy of To find out more about the EDIfly services, please contact us to discuss your Luxembourg requirements:

Richard Stokes (CEO) [email protected] Ingo Rössler (CCO) [email protected]

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