Wi-Fi Takes To The Air

By Gerry Blackwell

April 19, 2004

The Holy Grail for business travelers is about to become reality as Wi-Fi appears on planes... at least with some overseas airlines. Will it be worth the price?

Wi-Fi is about to take off.

Later this month, German airline Lufthansa will launch the first commercial in-flight Wi-Fi Internet access service using Connexion by Boeing, a product/service the aircraft maker has been developing and testing for the last two years.

Lufthansa will start small with four aircraft operating on European routes yet to be decided. It is committed to deploying the Connexion technology on 90 aircraft eventually, though. The two companies have been working on the project since 2002.

Singapore Airlines will launch a similar service in early summer, followed later in the year by SAS (Scandinavian Airlines), Japan Airlines, All Nippon Airways and China Airlines. The six airline companies have so far committed to equipping 120 aircraft in all.

Like similar Wi-Fi solutions for trains, Connexion uses satellite for backhaul -- 20 Mbps down and 1 Mbps up. Boeing is leasing Ku-band transponder capacity from more than one satellite service provider, allowing it to offer service virtually anywhere planes fly.

The one exception: over the North and South poles. Only about 1 percent of commercial passenger flights go over the poles, though, says Connexion vice president of strategy and business development Sean Schwinn.

Inside the plane, Connexion can deliver a wired solution with Ethernet jacks at each seat, or use Wi-Fi to deliver the service.

"Wireless is definitely the preferred solution," Schwinn says. "Wires are weight, and if a wire is running to a seat, if you decide to move that seat, you have to move the wire. It's much more expensive if you're reconfiguring the aircraft."

It may seem surprising that Wi-Fi works as an onboard delivery mechanism when other wireless technologies -- notably cell phones -- are strictly banned on aircraft because of the risk that they could interfere with navigational systems.

"It's really apples and oranges," Schwinn explains. "[Wi-Fi and cell phones] work on different frequencies, and a cell phone's power level is also about 20 times that of a Wi-Fi client device." (Many question the prohibition of cell phones in the air anyway, and some European carriers are even offering phones with "flight mode" available so handset can be used right through take off.)

Despite the bandwidth in the backhaul and over the Wi-Fi network inside the plane, the service will only deliver throughput to individual Internet access subscribers in the 100-to-128-Kbps range -- as Schwinn says, "a good ISDN line."

Boeing recently announced pricing for Connexion. It will offer flat rate and metered pricing. With the flat rate, which provides unlimited access to the Internet, passengers pay $29.95 for a long-haul flight (more than six hours), $19.95 for flights between three and six hours, and $14.95 for flights of less than three hours.

With the metered pricing option, they get the first 30 minutes for $9.95 and pay $0.25 per minute thereafter.

If the service were offering throughput similar to a terrestrial hotspot, the prices would be easy to justify. As it is, they may seem a little steep for a service that is really good for not much more than e-mail and very light surfing. You can bet, however, that Boeing has based its pricing -- and bandwidth management policies -- on extensive market research. Pricing models for hotspots on the ground probably don't apply in the air anyway.

"The real proof on user experience for us is how [users] feel about it," Schwinn says. "More than 90 percent [in our market tests] said they were 'very' or 'extremely' satisfied with the speed. And these are fairly sophisticated people."

Boeing may be banking on the fact that if passenger is paying over $1,000 for a long-haul flight, they are unlikely to balk at paying another $30 for access to e-mail and the rest of the Web -- even if it is slow.

Connexion is targeting frequent flyers first, especially corporate business travelers.

"We're going after precisely the guy who suffers most from being out of touch," says Schwinn. "They're also the customers who pay the highest yields to the airline. Now, rather than waiting until they land, we offer these customers a choice to stay in contact as they go."

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