Air Power

Las Vegas' MacCarran International airport has more than recouped its investment in common-use equipment, leading the way for other U.S. airports to eliminate proprietary airline systems that track flights, passengers

April 14, 2003

23 Min Read
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And he's not finished yet. Next, McCarran plans to deploy self-service kiosks that a passenger can use to check into any flight, at the airport or at a nearby hotel. He's also upgrading to a Gigabit Ethernet backbone network to ramp up wireless and multimedia applications, a move that might not have been possible had McCarran not taken central control of IT.

Love-Hate Relationship

Walker's IT-driven philosophy has drawn praise from other airport directors and ire from airline executives unaccustomed to relinquishing so much control.

When Walker and his team first called a meeting in 1996 to discuss setting up common-use terminal equipment, or CUTE, throughout the airport to replace the airlines' hardwired proprietary terminals, the carriers sent property managers instead of IT people. It was an act of defiance, a way to proclaim that the terminal buildings were the carriers' turf. The reception was cool, to say the least. "We could have harvested ice out of that meeting," Walker recalls.

Today, all but one of the 28 carriers operating at McCarran use CUTE systems, which the airport spent $60 million to deploy. The return on investment has been noteworthy: The airlines no longer have to maintain their own systems, passengers get more reliable and accurate information, and the airport has saved more than $100 million by letting carriers share gates and ticket counters rather than building additional facilities. Says Walker: "We wore them down by a process I call 'death by a thousand cuts.'"

CUTE Import

CUTE is the norm in Europe and Asia because the governments that run the airports there require it. It's also common in the international terminals of U.S. airports, simply because no single airline runs enough overseas flights to justify dedicated gates.

U.S. carriers generally have been reluctant to use CUTE because they like the status quo's branding advantages: When an airline has a whole terminal to itself, it can control the look of the entire facility, from the logos at the gates to the color of the wall treatments. The terminal is one big advertisement.

Now, Arinc and SITA, the two biggest sellers of CUTE systems, connect CUTE to the background signage at ticket counters, gates and baggage carousels, giving airlines more branding options. When an American Airlines employee logs onto CUTE, American's logo pops up on a monitor behind the desk. American can even add its own animation. Arinc is McCarran's vendor and integrator for CUTE.

At McCarran, the transfer of gates from one airline to another is seamless. Once the signage changes to, say, Continental, you can't tell that American ran flights out of the same gate an hour earlier, says Dick Marchi, senior vice president for technical and environmental affairs at Airports Council International (ACI), an airport trade association.In fact, when National Airlines went out of business last November, McCarran's IT staff was able to move another airline into its counter space within a few hours. If the airlines had been using proprietary systems, this process might have taken days.

Big carriers also dislike CUTE because it makes it easier for small airlines to move in and set up shop. Discount carriers don't have to buy, deploy and maintain their own ticketing and baggage systems; they only have to write the scripts to connect their back ends to CUTE. The ticketing applications are accessed using terminal emulation, so airline employees use the same applications they're accustomed to using.

There is, however, one disadvantage for the discount airlines: Because they generally don't operate internationally, they have no code base and no experience writing interfaces to CUTE systems. This may explain why Southwest Airlines is the lone CUTE holdout at McCarran despite being the airport's No. 1 airline, representing nearly a quarter of McCarran's volume.

"Southwest has a very simple business model that's been successful, and they don't like to tinker with it," Marchi says, referring to Southwest's overall low-tech approach and its practice of buying technology in liquidation sales from defunct airlines.

Southwest also isn't part of the International Air Transport Association (IATA), the body that sets standards for boarding passes, baggage tags and other documents. This organization makes sure passenger data is formatted similarly enough across airlines that it's transferable. Thanks to IATA, if your itinerary takes you on multiple airlines, you don't have to fetch your bags and check in again. If Southwest is part of your travel plans, you do.But financial pressure and new security requirements may create a perfect storm that finally pushes Southwest and other airlines to embrace CUTE. As of April 1, the Transportation Security Administration (TSA), established after 9/11, requires an individual to hold an airline-issued boarding pass in his or her name to get through security checkpoints. Previously, the only federal requirement was a printed reservation, and some airlines, such as Southwest, preferred to issue boarding passes at the gates.

The new regulation would likely result in overcrowding at ticket counters near terminal entrances, so airports are adding self-service kiosks to ease congestion. But they take up a lot of space. "If every airline wanted to have its own proprietary kiosk in the terminal, there is no way we could accommodate it," airport director Walker says. "We'd have no space. They would be lined up like news racks. People would be tripping over them to get to their gates."

Further complicating matters, the TSA has placed a luggage X-ray machine the size of a SUV where ticket counters used to be, taking additional space from the airlines.McCarran's solution is to deploy common-use self-service kiosks, which officials call CUSS. Passengers can use these touch-screen terminals to print out boarding passes and bag tags for travel with any airline.

"Everybody's logo is on the touch screen," Walker says. "I touch my airline and am immediately launched into its kiosk system." Without the common-use technology, McCarran would have to limit airlines to one or two kiosks apiece. With CUSS, they get 38 shared kiosks to start, all of which "function just as their normal application would," says Sam Ingalls, McCarran's information systems manager.

McCarran is also footing the $2.5 million bill to deploy the kiosks and related network infrastructure; this is another service McCarran provides to tenants as part of its rates and charges, which average $5.10 per passenger.The CUSS specifications were finalized by IATA last month, and the initial 38 terminals, all running Microsoft Windows 2000, are due to go live April 30. The Arinc systems connect to the airlines' back-end reservation systems in much the same way as the CUTE systems. This trend toward self-service kiosks may compel Southwest and other discounters to adopt CUTE.

Southwest is developing its own self-service kiosks. The next step will be to evaluate the CUTE and CUSS specs to make sure the code Southwest develops for its McCarran operation is reusable in other airports, says Robert Shaffer, a manager in Southwest's interactive marketing department.

Shaffer says Southwest's IT department has been occupied with higher priorities since 1997, when McCarran first went live with CUTE. It started with Y2K remediation, then an upgrade of the airline's reservation system, which is now almost complete. CUTE is next on Southwest's agenda, he says.

Not So Easy

To say that CUTE systems make counter positions and gates fully interchangeable is an oversimplification. It's not so easy to shift around the ground-handling equipment outside each gate, so for one carrier to replace another quickly, its ground equipment must be nearby, experts say. McCarran must be mindful about which airlines are most likely to share gates so it can place them near one another. There was some gate-sharing prior to CUTE; temporary podiums were rolled in, equipped with a carrier's proprietary terminal.The next step at McCarran will be to deploy self-service kiosks inside hotels on the Las Vegas strip. Passengers will be able to check in, print a boarding pass and bag tags, and give their baggage to handlers to take to the airport. These Windows 2000 units are the same as the CUSS systems in the airport, only they're connected to the airport over 56-Kbps WAN circuits. Off-site check-in would be impossible without common-use equipment, because hotels would never devote enough space for each airline to run its own terminal equipment, says David Bourgon, who as airline systems manager oversees the CUTE and CUSS systems at McCarran.

The Las Vegas Convention Center is scheduled to set up four to six self-service kiosks by July. Beyond that, McCarran must negotiate with hotels individually.CUTE sounds like an idea whose time has come, but McCarran is a rarity among U.S. airports: Only 5 percent of a typical airline's gates are CUTE gates, says ACI's Marchi, so the carriers' IT organizations focus on developing and maintaining software for proprietary systems. Their developers prioritize writing code for the legacy systems before they worry about how those changes will affect the presentation of their applications on CUTE front ends. "CUTE is an afterthought," Marchi says, so the CUTE code tends to be buggy.

But one major obstacle to CUTE adoption is about to be lifted. When the airlines built their terminal buildings in the 1960s and '70s, they signed 30- or 40-year leases with local governments. Those leases are coming due, and Marchi thinks most municipalities will decide to run the terminals themselves, as Clark County does at McCarran. Many will want to push common-use equipment to exert control, Marchi says.

The exceptions will be airports where one carrier operates a transfer hub. For example, at Hartsfield Atlanta International Airport, where Delta Air Lines controls 75 percent of the volume, it doesn't make sense to deploy CUTE throughout the airport if other airlines will never use Delta's gates. In those airports, a hybrid approach may emerge, with a portion of the airport employing CUTE for carriers that don't need dedicated gates.

Meantime, the airlines are under more financial pressure than ever as businesses and consumers cut back on travel amid a weak economy and fears of terrorism. The airlines are looking to outsource as much as they can, Marchi says. "If a ticket printer breaks at most airports, Delta has to fly someone in to fix it," he says. "At McCarran, they have the spare parts and the technician on site, and they just repair it for the airline." A printer problem is usually resolved in about 30 minutes, Bourgon says. McCarran doesn't charge the airlines separately for service calls.Care and Feeding

In addition to the 30 IT staffers McCarran employs, five Electronic Data Systems technicians work on site. They help maintain the network and develop improvements to the flight information display systems (FIDS) that tell passengers when planes are arriving and departing. Marty Beeman, an EDS software developer at McCarran, says he's working on several display improvements, including voice recognition and emergency messaging.

Information about departures and arrivals is also integrated across airlines. Displays carry flight information for all the airlines, whereas in most domestic airports each carrier has its own screens. What's more, McCarran controls which flight data is shown to passengers. The airlines' data is used by default, but several times per minute that data is checked against the FAA's logs, and if the airline is off by 12 minutes or more, it loses control of the flight display.

In contrast, most flight displays in domestic airports are fully controlled by the airlines. If a snowstorm grounds planes, the displays might claim that flights are on time even though they're not taking off. The technicality, of course, is that the airline isn't causing the flight to be delayed. At McCarran, "we try to give the airlines the benefit of the doubt that they are trying to keep their information as accurate as possible, so we don't want to say, 'OK, if you're one minute off, you're out of luck,' " Bourgon says. "We want to give them some control and flexibility to be able to convey to the public what they want to convey."

The only systems at McCarran that aren't integrated are the parking, central-plant and security systems. It pains Walker that he still has to use them. "I hate proprietary systems," he says, pointing to the high cost of maintaining and repairing systems that only one company can service. "I hate them with a passion."Why McCarran Is Different

McCarran has an advantage over many other U.S. airports because it's a so-called origin and destination airport; people don't generally fly through Vegas, they fly to it. This means no one airline dominates by operating a hub. Those that do, such as United Airlines in Denver, can dictate the IT approach at their home airports, because if United were to disappear, the impact on the airport, and the local economy, would be catastrophic. At McCarran, only 8 percent of passengers are going somewhere else, compared with 60 percent in Denver. If any single airline halts service to Las Vegas, passengers simply take another airline. America West Airlines, for instance, went from 139 flights per day to 79 per day last year, but McCarran saw no difference in volume, Walker says.

McCarran takes on the expense of administering and maintaining nearly all airport systems on behalf of the airlines. (Southwest and America West have some IT staff on premises.) Upgrades are McCarran's problem. But the airport gains efficiencies in return: It has increased gate capacity more than 10 percent, and officials maintain that the added capacity saves them 757s full of money.

This is because McCarran uses preferential gate leasing instead of dedicated gate leasing. If a gate isn't being used, McCarran has the right to assign it to another airline on the fly. This makes more efficient use of the gates and avoids the expense of building more gates to accommodate more passengers.

Ross Johnson, McCarran's assistant director of finance, figures the airport has saved $120 million since the common-use systems were deployed in 1998 by sidestepping the need to build 10 additional gates. That figure doesn't include the operating costs to clean and maintain another terminal building.Walker puts it this way: If the airport had to take out a loan to build a new terminal, at an interest rate of 6 percent, that $120 million would have cost McCarran $39 million during the five years since CUTE went live.Even with that added capacity, the airport is expanding. Later this year, construction will begin on an extension to the D gates and a new consolidated rental-car facility. McCarran sold $250 million in bonds for these and other capital projects, but the projects have been on hold since 9/11, Johnson says.

From a financial perspective, McCarran has some advantages over other U.S. airports. It pulls in about $40 million per year in slot-machine revenue, money that must go to capital projects, such as new buildings. This frees up funds for other, nonbuilding projects. In fact, much of the airport's IT infrastructure can be traced back to gambling revenue.

About 8 percent of the airport's some $218 million operating budget goes to IT, and IT represents about 40 percent of the airport's non-building capital budget. In addition to the operating funds which come directly from revenue, McCarran generates about $44 million per year from passenger facility charges and another $12 million from jet fuel taxes.

McCarran has some other creative ways to fund IT projects. This month, the airport is upgrading its 100-Mbps FDDI network to Gigabit Ethernet. Its infrastructure vendor, Enterasys Networks, accepted a barter deal in lieu of cash wherein McCarran will give Enterasys 15 percent of its unused billboard space for three years in exchange for the gear. McCarran will still pay Enterasys $82,000 for installation and about $110,000 per year for maintenance, says Gerard Hughes, McCarran's senior network analyst. The gear, including enough switches to outfit the airport's 75 closets, is worth about $1.8 million.

Likewise, Computer Associates is giving McCarran a discount on its Unicenter network-management package in exchange for signage. The software, which replaces Hewlett-Packard's OpenView, is being implemented with the network upgrade. Both should be completed by August, Hughes says. McCarran is paying CA $725,000 for the software. Hughes would not disclose the full price.The Gigabit Ethernet upgrade will enable a range of new applications for airport management, security personnel and consumers. McCarran plans to provide videoconferencing and wireless networking for managers, and it's exploring wireless connectivity services for consumers. Also, the TSA has said it wants to equip security personnel with wireless handheld computers that can call up surveillance video or photos of fugitives instantly. Photos already can be displayed on flight monitors to alert police when someone is trying to evade capture.

There's always a chance the TSA will insist on installing its own network for such purposes, as the federal government has been known to do. But McCarran officials would like to persuade the TSA to house everything on one network, as it has done with the airlines. The security regulations coming down from the TSA are perhaps the most pressing reason for the network upgrade, which has been planned for some time. "It's moved from a 'nice-to-have' to pretty much a must-have situation," says IS manager Ingalls.

McCarran's top executives agree that they don't necessarily apply a rigid return-on-investment model to every IT purchase. They know in hindsight that common-use equipment has saved them money, but there's no way they could have been sure of that in advance. "Once you've made a commitment to technology, you can't shortchange yourself," Johnson says. "You have to have the best all the time. We determined early on that there was a significant operational benefit, and IT gave us better control of our facility."

Glimpse at Airports' Future?

Aviation experts and even one former McCarran IT manager call the airport's transformation to central IT control an astonishing achievement. They consider McCarran a proof of concept for common-use technology in U.S. airports. Among the other airports now considering common-use systems airportwide are Miami International, Oakland International, Orlando International and Seattle-Tacoma International.Howard Kourik, the recipient of Walker's tongue-lashing when the network went down in 1995 and later McCarran's IS director, describes the incident as "a defining moment in my understanding of his modus operandi--you keep things working, and I'll tell you how much you can spend to do it."

Kourik, now director of IT at San Diego International Airport, describes Walker as more tech-aware than any other boss he has worked for. "He always wanted to understand the implications of spending different amounts of money," Kourik says.

It helps that Walker has IT experience. As an accountant working for Exxon Oil Co. in the late 1970s, he was trained as a computer programmer and developed mainframe applications for two years. "I worked on the biggest, newest, fastest IBM machine at the time--the IBM 333. I think it's in the museum now," he says. "But at least I got an appreciation for the ability of the computers to automate things and make things more efficient."

Throughout the IT department's rise to prominence in the past decade, Walker has been its biggest fan and harshest critic. At either extreme, one thing has always been certain: He keeps a close eye on what the tech folks are doing. He's even tough when he describes his own thinking about glitches like the one that downed the network those years ago: "It has to be unique. It has to be unforeseen. And it better not happen twice the same way."

Experts point out that central control has been effective not only for the airlines and their passengers but also for IT management, which has lost only a few staffers in recent years, even as turnover became a problem for IT shops in the late 1990s. Remember that the next time your CEO threatens to fire you for attempting to save money.David Joachim is Network Computing's editor/business technology. Write to him at [email protected].

Post a comment or question on this story.

In our third 'On Location' documentary-style case study we spotlight McCarran International Airport in Las Vegas, a trailblazer among U.S. airports in its use of CUTE (common-use terminal equipment). McCarran spent $60 million to deploy CUTE, but in return tenant airlines no longer have to maintain proprietary terminals, passengers get more up-to-date information, and the airport has saved more than $100 million by sharing gates and ticket counters rather than building new facilities. In this issue we'll look at how McCarran's leadership made CUTE a reality and examine other on-tap projects at McCarran, such as a new video-surveillance system, a switch from FDDI to Gigabit Ethernet, and wireless initiatives. Future coverage will include print and online progress reports, and our online forum will allow you to post questions, comments and suggestions.

'On Location' packages:

McCarran International Airport; Las Vegas

11: Ranking among U.S. airports, by volume*28: Airlines operating at McCarran

1: Number of carriers that use proprietary terminal equipment (Southwest, the airport's biggest carrier by volume)

12: Maximum number of minutes an airline can be off before McCarran takes over arrival/departure display

$60 mil: Cost to deploy common-use terminal equipment (CUTE) throughout airport

10: Percentage gain in gate capacity from use ofcommon-use terminals

$120 mil: Estimated cost to build a 10-gate terminal, avoided since 1998 thanks to CUTE

$39 mil: Interest payments avoided

$5.10: Average fee per passenger that airlines pay McCarran

$40 mil: Slot machine revenue$18 mil: IT operating budget

30: IT staff at McCarran

3: IT staffers who have left in the past 10 years

*Source: U.S. Department of Transportation

Randall H. Walker; Director of Aviation | Samuel G. Ingalls; Information Systems Manager | Gerard Hughes; Senior Network Analyst | David Bourgon; Airline Systems Manager | David Webb; Senior Business Systems Analyst



Randall H. Walker; Director of Aviation

At Work: Runs McCarran International Airport for Clark County, Nev.

At Home: 49 years old. Married, six children. Hobbies include spending time with grandchildren and visiting mountain cabinAlma Mater: Brigham Young University, B.S. in accounting

How He Got Here:

1996 to 1997: Finance director and assistant county manager, McCarran International Airport, Las Vegas

1990 to 1995: Deputy director of aviation, McCarran International Airport

1984 to 1990: Deputy city manager, Las VegasMouthing Off:

Most misunderstood aspect of my job: "What does an airport director do? Most people do not understand how an airport functions, and they get our roles confused with the airlines' and federal government's."

Greatest business challenge for McCarran: "Before 9/11, it was keeping up with the growth (6.5 percent annual growth in the 1990s). Since 9/11, it is dealing with the new and ever-changing security rules."

Chief difference between McCarran and other airports: "We're the second-largest origin-and-destination nonhub airport in the world, behind LAX Los Angeles International; 92 percent of our passengers come through the front door."

Biggest impact of 9/11 on McCarran's IT organization: "Trying to develop uses for our existing IT infrastructure in the security procedures to minimize the impact to our customers."Gambling philosophy: "I live in Las Vegas, I don't like to gamble."

Biggest bet ever made: "25 cents."

Samuel G. Ingalls; Information Systems Manager

At Work: Visioning and managing IT and telecommunications services at one of the busiest airports in the world

At Home: 41 years old. Married, three children. Hobbies include piloting and boating

Alma Mater: Embry-Riddle Aeronautical University, B.S. in aviation business administration; American Association of Airport Executives, professional certification as an accredited airport executive (AAE)How He Got Here:

1995 to 2001: Airport business administrator, McCarran International Airport, Las Vegas

1990 to 1995: Strategic affairs coordinator, McCarran International Airport

Mouthing Off:

The most misunderstood aspect of my job: "The need to balance my focus between providing a first-class customer-service product, internally and externally, while working on significant, industry-leading projects."Biggest impact of 9/11 on McCarran's IT organization: "Enhancing passenger-processing efficiency has been a challenge that we've historically engaged in head-on. 9/11 only served to narrow our focus on that element."

If I could do anything over in our IT organization: "I would have started with a larger main computer room. There is no such thing as too much space."

Gerard Hughes; Senior Network Analyst

At Work: Responsible for McCarran's operational and administrative data networks; airport telecommunications networks; and operational pagers, cell phones and trunked radios

At Home: 43 years old. Married, four children. Hobbies include outdoor activities, traveling and building an extensive jazz library

Alma Mater: Community College of the Air Force, A.A.S in management information systems; Community College of Southern Nevada, A.S. in computing and information technology; coursework in MIS at the University of Nevada, Las VegasHow He Got Here:

1995 to 1997: Departmental systems coordinator, departmental systems technician and systems technician, McCarran International Airport, Las Vegas

1978 to 1995: Network systems manager, Unix systems administrator and telecommunications systems operator, Central Processing and Communications, U.S. Air Force

Mouthing Off:

If I only had a bigger IT budget, I would: "Fatten the pipes and train more."The most misunderstood aspect of my job: "It's a lot like electricity--as long as the lights are on, no one really cares what makes it happen. The network can be up and operational 24/7 for months, but one burp during an operationally critical moment and the importance of network infrastructure is paramount."

Biggest impact of 9/11 on McCarran's IT organization: "Increased bandwidth demands for security applications, interfacing with the Transportation Security Administration, and increased emphasis on disaster recovery as part of strategic planning."

If I could do anything over in our IT organization:

"I wouldn't change a thing. Other airports see McCarran as a global leader in airport management."

Biggest bet ever made: "$100 on Tyson vs. Holyfield in 1996."David Bourgon; Airline Systems Manager

At Work: Oversees all IT systems used for ticketing and baggage tracking, the airlines helpdesk, and IT ordering and inventory

At Home: 36 years old. Married, two dogs. Bowls professionally. Hobbies include golf and cooking

Alma Mater: University of Nevada, Las Vegas

How He Got Here:

1990 to 1993: PC support technician, Clark County Public WorksMouthing Off:

The most misunderstood aspect of my job: "It's probably the same for most IT professionals: Keeping systems running smoothly with little or no downtime, as well as keeping a high level of customer service, takes an incredible amount of teamwork and behind-the-scenes effort."

Chief difference between McCarran and other airports: "We are the largest common-use airport in North America and the third largest in the world. This allows us to give unparalleled service to our flying customers as well as my airline customers."

I love technology when: "It really helps to change a process for the better."

I hate technology when: "It is just for technology's sake. I want every vendor who comes here to blow me away with what their technology can do for me."Biggest bet ever made: "$50 on a football game."

David Webb; Senior Business Systems Analyst

At Work: Manage servers, server operating systems, Web servers, document-management systems, storage, e-mail, user management and security, and Internet domain names

At Home: 44 years old. Divorced, two children. Hobbies include home improvement and ATV (all-terrain vehicle) riding

Alma Mater: University of Nevada, Las Vegas

How He Got Here:1995 to 2000: Departmental systems coordinator, McCarran International Airport, Las Vegas

1989 to 1995: Programmer analyst, Clark County Sanitation District

Mouthing Off:

Greatest business challenge for McCarran: "Continue to provide superior air-travel facilities and services to support the growth of Las Vegas."

Biggest impact of 9/11 on McCarran's IT organization: "Increased emphasis on security, and the rapid implementation of applications related to security."When I retire, I will: "I get to retire?"

Personal gambling philosophy: "I've got more important things to spend my money on."

Biggest bet ever made: "$5."

Favorite show on the strip: "Blue Man Group"

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