The Race to Provide Wi-Fi at 30,000 Feet

By JOE SHARKEY

Published: May 18, 2009

 

SOME airlines are rushing to offer Wi-Fi Internet connections in their domestic aircraft cabins, but none are talking about the space squeeze.

 

On an AirTran Airways Wi-Fi demonstration flight that went up and back down the Northeast seaboard from Baltimore-Washington International Airport last week, the Internet worked just fine. The problem was actually being able to use it efficiently. My laptop was wedged onto a tray table in the cramped space of a coach seat. I had to slide down in my seat just to read the screen.

 

“I have the same experience,” said Jack W. Blumenstein, the chief executive of Aircell, the company that is providing nearly all of the Wi-Fi installations so far for domestic carriers. “The laptop’s at an angle or it’s propped up almost on my nose.”

“Or I’m typing like this,” Mr. Blumenstein said from his own coach seat on the flight. He slouched down, raised both hands and wriggled his fingers like someone scratching on a window.

 

AirTran, a low-cost carrier based in Orlando, Fla., surprised the industry last week with its announcement that it would install Aircell’s Gogo Inflight Internet service on its 50Boeing 737s and 86 Boeing 717s by midsummer. Doing so would make AirTran the first domestic carrier to offer Wi-Fi on its entire fleet.

 

Delta Air Lines is also speedily installing Wi-Fi. It had previously announced that it was putting the service on its entire mainline domestic fleet of more than 300 aircraft, and said the day before the AirTran demonstration that it now had the Aircell Wi-Fi system on half its planes and would have the other half converted by September.

The rush to go Wi-Fi makes for an interesting horse race in the North American airline industry, where American Airlines, United, Virgin America and Air Canada are all installing Aircell’s Gogo system.

 

But there are handicaps, including the lack of electrical outlets in most coach cabins (so usage is limited by battery life), and the question of how much demand there actually is for an Internet hookup at the prices being contemplated. AirTran, for example, is charging $9.95 for flights under three hours and $12.95 for those over three hours.

 

So far, said Joe Brancatelli, publisher of the business travel Web site Joesentme.com, “there is zero proof” that a significant number of passengers are willing to pay for in-flight Wi-Fi service on domestic routes. (The Aircell service depends on land-based cellular towers and cannot be used on overseas flights.)

 

Furthermore, he argued, those who are inclined to use Wi-Fi on a flight, including business travelers drawn by the potential for increased productivity, are exactly the people who most resist being nickel-and-dimed for services like Internet connections in a hotel — or on a plane.

 

The Gogo service costs an average of about $100,000 a plane to install, said an Aircell spokeswoman, Arianne Venuso, , who declined to give specific figures on how many people use it on planes already outfitted, like the 767s flown by American Airlines on its coast-to-coast routes. “Usage has exceeded expectations,” she said.

Obviously, the airlines rushing to install Wi-Fi are banking on a viable market. In this sour economic climate, Wi-Fi is one of the few new services that domestic carriers are spending money on.

 

“We’re leapfrogging the industry getting the Internet on board, but in a short period of time, a couple of years, everybody is going to have it,” Robert L. Fornaro, the AirTran chief executive officer, told me on the flight. “It’s too important not to have.”

 

Mr. Blumenstein, of Aircell, pointed out that laptop users going through contortions to use the Internet — perhaps with that seat in front of them cranked back all the way — are not the only market for the service. Aircell and its airline partners are clearly betting on a big increase in the market for Internet-enabled smartphones.

AirTran, for example, set a lower price, $7.95 for flights of any length, for passengers using Wi-Fi smartphones. With an iPhone or a BlackBerry enabled for Wi-Fi, that problem with tight space shrinks considerably.

 

“When we started out to build our network two summers ago, there was not a single smartphone with a Wi-Fi chip in it, not a single BlackBerry with a Wi-Fi chip. Now, if you look at the industry data, about 90 percent of all hand-held devices going out in the next five years are going to have Wi-Fi chips,” Mr. Blumenstein said.

 

Source: http://www.nytimes.com/2009/05/19/business/19road.html?_r=1&ref=technology

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