The Reed Smith Guide to the Metaverse - 2nd Edition

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Aviation has always been an industry of pioneers, so it comes as no surprise that it has been quick to embrace new technology. The endless possibilities offered by the metaverse are being explored at pace, and the advent of electric vertical take-off and landing (eVTOL) aircraft and unmanned aerial equipment like drones marks the arrival of the next generation of urban air mobility vehicles. At Reed Smith, we have been privileged to play a leading role in the introduction of this transformative technology – albeit a small one in comparison to that of the engineers and entrepreneurs.

Leaving on a jet plane

Aviation was one of the industries most severely impacted by the COVID-19 pandemic, and it remains under pressure from various macro factors: rising interest rates, staff shortages, the price of fuel, and, of course, the increasing replacement of business travel with virtual meetings. Against that backdrop, airlines and airports are turning to the metaverse to augment their offering.

For example, the airport experience has been digitally enhanced with:

  • Virtual queuing: trialed at LAX
  • Immersive shopping: London’s Heathrow Airport partnered with luxury brands like Chanel and their “beauty spaceship,” enabling shopping passengers to try on products virtually
  • Virtual replicas: Qatar Airways recently launched QVerse, a virtual reality program that allows passengers to look inside the aircraft from the comfort of their homes

Manufacturers are also pushing boundaries via the metaverse, with Airbus and Boeing looking at ways to streamline production by creating digital replicas of aircraft and using these to run tests and simulations. This means they would be able to gather data and results without needing to accumulate flight hours on a physical trial aircraft, saving costs and mitigating safety risks to the test crew. Airbus and HeroX also held a crowdsourcing competition called “Metaverse and the Future of Flight,” seeking innovative ways to use the metaverse to reimagine and elevate the traveler experience.

I can see for miles

If the metaverse can facilitate airport access and airport shopping, it can also make it easier to earn and redeem air miles. Many of us are lured by frequent flyer programs that offer benefits with an airline, and these create huge real-world value for both travelers and airlines in addition to generating customer loyalty. Air miles are very lucrative for those airlines that manage to monetize their loyalty programs, which are often worth considerably more than the airline itself. American Airlines, for example, used its program as collateral to borrow money from the U.S. government.

Taking this a step further, airBaltic, the first airline to accept cryptocurrencies in payment for tickets, also became the first airline to issue non-fungible tokens (NFTs) when it launched Planies, an NFT collection of tokens that it will be linking to its loyalty program. Emirates will also launch NFTs and experiences in the metaverse, alongside both collectible and utility-based NFTs.

Air mile programs are also closely connected with ticket sales, and this new technology offers novel distribution opportunities. Air Europa, for example, has established a partnership with blockchain distribution company TravelX (the company building the first blockchain-based distribution protocol for the travel industry) to come up with the world’s first NFT flight ticket series, or “NFTickets,” entitling owners to access a special flight to an event in Miami Beach. This will allow passengers to manage and transact with tickets using their own blockchain wallet, combined with a new kind of collectible art piece. At auction, Air Europa’s first NFT sold for $1 million. As another example, Vueling is looking to sell flights in the metaverse that can be used in the real world, providing the airline with a new distribution channel.

Key takeaways
  • Advanced air mobility marks the next inflection point in aviation’s continual evolution.
  • With such complex technology, the range of legal and regulatory issues is vast.
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