American, Delta and United join venture to launch broadband e-mail, internet and live television services

Boeing's airborne internet start-up Connexion is to become a joint venture with the three largest US airlines, after American, Delta and United signed a letter of intent to equip 1,500 aircraft in return for a stake in the company.

The agreement follows protracted negotiations over revenue sharing that have delayed roll-out of the satellite-based service to the second half of next year. Even then, the airlines will only test the system on 10 aircraft each initially.

Once definitive agreements are signed, Boeing and the airlines will contribute funding, know-how and assets to the new venture, which will still be called Connexion by Boeing. The manufacturer will be the major shareholder, with overall management responsibility, and the airlines will equip 500 aircraft each within five years.

Connexion plans to provide broadband two-way communications, including passenger e-mail, internet, corporate intranets, live television and other services. Longer-range aircraft are expected to be equipped first. Airlines will be able to use the service for real-time communication of maintenance and other operational data.

Connexion "is in discussions with other airlines around the world", says president Scott Carson. Unconfirmed reports have cited Continental and Lufthansa.

The company will not disclose each airline's stake, who will carry the cost of equipping the aircraft or how the revenues will be shared.

Passengers will have to use their own "connectivity devices", such as laptop computers, to access the services. The service is expected to cost around $20/h, "similar to a cellphone", says Carson. Initially, the service will be available over continental USA, with leased transponders on Ku-band satellites providing 5mbit/s to the aircraft and 1mbit/s off. This is enough to give every passenger internet access at the 56kbit/s of a standard dial-up connection, Carson says.

Connexion has US Federal Communications Commission approval for the receive side of its service, and expects approval for the transmit side by year-end. The company will then have to secure approvals for transatlantic and, eventually, global service.

Boeing is targeting 10% of a market - estimated to be worth $45 billion a year - by the end of the decade.

Source: Flight International