In-flight broadband revenue this year will grow by a whopping 1,357%, but fee-for-connect arrangements will remain under pressure, claims a new report from market intelligence firm In-Stat.

Noting that Wi-Fi airplane deployments have skyrocketed from a couple dozen in 2008 to an expected 2,000 planes by the end of this year, In-Stat says revenues from in-flight broadband will reach $95 million in 2010, up from just under $7 million in 2009.

Air-to ground (ATG)-based in-flight connectivity provider Aircell is currently the market leader in North America with announced airline partners including Air Canada, AirTran Airways, Alaska Airlines, American Airlines, Delta Air Lines, Frontier Airlines, United Airlines, US Airways, and Virgin America. Continental Airlines recently delayed its planned trial of the system, as it thrashes out merger details with United.

California-based Row 44, meanwhile, has started rolling out its Ku-band satellite-centred connectivity system on Southwest Airlines' fleet, while Panasonic Avionics is playing a key role in re-instating in-flight high-speed Internet on Lufthansa's aircraft. Lufthansa is currently testing the system on four aircraft. Turkish Airlines also intends to offer Panasonic's service starting in the fourth quarter of this year.

Additionally, Oman Air recently became the first airline in the world to offer passengers both in-flight mobile and Internet, after switching on Airbus/SITA joint venture OnAir's connectivity solutions on an Airbus A330-300.

In the United States, however, where the majority of in-flight Wi-Fi fits have taken place with Aircell's Gogo service, the pay-for-service business model does not seem to be gaining as much traction as expected. In-Stat predicts there will be a further deterioration with fees projected to decline 24% from 2010 to 2014.

The research firm notes that providers are beginning to explore the opportunity of supplying video to augment Wi-Fi service. Aircell is offering a video download service, and Row 44 intends to exploit its Ku-band pipe for television over IP.

Direct Broadcast Satellite (DBS)-based in-flight television, the likes of which is provided by JetBlue Airways subsidiary LiveTV for the low-cost carrier's fleet as well as on Frontier Airlines, WestJet and Continental Airlines, promises to supply three times the size of revenue over Internet video in 2014, according to In-Stat.

Source: Air Transport Intelligence news