Is off airport check-in really a good idea ?

Off airport check-in refers to online check-in and telephone check-in
whether vocal, sms or wap based.
At first sight this looks like a very good idea. Indeed, IATA study
shows that counter check in costs around 5 USD per passenger while off
airport self service check in costs around 0.5 USD. The main driver
of cost reduction is removal of the agent - which was already achieved
with self-service kiosk - and faster process (mean time for passenger with bags is greatly reduced). But looking more closely, this is in fact the
automation of a very old and inefficient process : check in was
created originally to manage overbooking and assign seats to
passengers once the type of aircraft was assigned to the flight
(around 24 hrs prior to departure).
So the real question is : do you really need passengers to check-in ? Stepping back from your day to day operations, why do you need passenger to ask for a seat in the aircraft ?
Secondly outside business and frequent flyers, wap enable phones are not a majority. But these occasional flyers are also those with baggage. What is the benefit of off airport check-in if you have to drop a bag ?
This will depend on your process and local regulation.
Some of the questions you need to ask yourself are :
Can a passenger that checks-in on the web with no bags go directly to security ? If so, web check-in is interesting. But in this case, why not delivering the barcode and seat assignment at booking stage ?
Some airlines do so. Large network carriers don't, arguing that it is not possible to assign a seat without knowing what aircraft will be assigned to the flight. But, they could also think in these terms : is it better to pre-assign a seat and deliver a boarding pass at booking stage with a risk that seat may need to be changed or would you rather ask all passengers to get their boarding passes ? Interested in a middle ground ? Think about this : some airlines have implemented check-in at booking for their frequent flyers and business travelers. Flexibility on aircraft type is managed with the rest of passengers.

So, why is self service off airport check-in still implemented ? In fact, the reasons sits more on the marketing side. Ancillary revenues are making a growing part of airline revenues. Te opportunity to have more contact point with passengers is an opportunity to sell exit row seats, bag allowances, etc. o the decision is between having a longer process for everyone to capture additional sales versus offering an improved passenger experience.