Boeing, Intel Pushing In-flight Internet

Boeing is gearing up to roll out its Connexion
in-flight Internet access service in the sky.

Connexion is Boeing’s wireless subsidiary and the venture has been testing
its airline-based Internet service with Lufthansa German Airlines earlier
this year, and British Airways will begin officially offering the service
starting on February 18th. Connexion has signed deals with Japan Airlines
and Scandinavian Airlines System to begin service in 2004.

Boeing has plans to install servers, access points and antennas in as many as
4,000 of its airliners in the next few years. Boeing expects to have 150
aircraft retrofitted in 2003, with another 800 planes to be Internet-ready
in 2004. Future Boeing planes are expected to have this equipment, as part
of assembly line construction.

Boeing is working closely with Intel in building new
wireless technology into devices, networks and communication ports. There
are plans for Wi-Fi, or 802.11b, wireless connection ports at airports. On
Thursday, Intel announced it will launch its chip for the next generation of
notebook computers with built-in wireless network connections on March 12th.
The wireless technology is called Centrino, and connects new wireless chips
with mobile communications networks. Boeing is a partner in the new Intel
wireless technology solution. The new chip that is part of the Centrino
bundle is called Banias.

Boeing has done some market research and it expects that approximately 20
percent of passengers with pay for the service, which will cost between $25
and $35 on a transcontinental flight, and less on domestic U.S. flights.
There will be a revenue split of that fee between Connexion and the
participating airline.

Boeing created Connexion back in November 2000 and initially the venture was
financially backed by American Airlines , Delta Air Lines
and United Airlines . But as these and
other U.S. airlines, have fallen on hard financial times after September 11,
2001, these companies divested their investments in Connexion. Thus, while
shouldering the bulk of the development costs, Boeing is now positioned to
capitalize, if there is sufficient air traveller demand for in-flight
Internet services.

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