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Web Connection Ready for Takeoff

Using Boeing technology, Lufthansa jets will offer Net access to passengers

March 22, 2004|Peter Pae | Times Staff Writer

Taking Web surfing to new heights, passengers aboard Lufthansa jumbo jets will soon be able to flip open their laptops and browse the Internet, becoming the first air travelers to have a direct network connection from the sky.

In a boost to Boeing Co., which developed the computer system at considerable cost, Lufthansa will begin offering the high-speed Internet service in late April or early May on flights between Germany and the U.S. The carrier's plans are to install the system on each of its 80 long-haul aircraft within two years.

Among frequent fliers, emotions are mixed at the prospect.

"To me it's a wish come true. I would love to walk off an airplane and know my [e-mail] inbox is empty," said Thom Nulty, a partner with the Corporate Solutions Group, a travel management consulting firm in Monarch Beach. But Joe Brancatelli, publisher of a website for business travelers, Joe Sent Me, said some won't appreciate having their refuge invaded.

"People liked going on the road because they could control their time. The last safe place from cellphones, pagers and Blackberries was up in the air," he said. "Now your boss can say, 'So you're flying to London? Great -- get online and let's knock out a memo.' "

Lufthansa declined to provide details about the rollout, but an airline source said the Internet service would be inaugurated on the 12-hour Munich-to-Los Angeles flight.

Six other airlines are planning to offer the service this year, Boeing said, including Singapore Airlines Ltd., Scandinavian Airlines System, Japan Airlines Systems Corp. and China Airlines. (In an odd twist, the first Lufthansa flights to offer Boeing's Internet service will be on planes made by Airbus -- Boeing's longtime commercial aircraft rival.)

With FlyNet, as it's called, Lufthansa passengers with laptops will be able to send and receive e-mail, browse the Internet, download videos and access company intranets. Passengers will pay a flat fee of about $30 for unlimited access during a flight or by the minute, with the first 30 minutes costing about $10.

Although a wireless Internet connection is increasingly easy to find, in a Starbucks coffee store or an airport terminal, network access has remained mostly grounded: The airplane is one of the few places where the Internet has been kept at bay, mainly because of the high connection costs.

Travel analysts said offering the Internet service could help airlines differentiate themselves and lure more lucrative business travelers, about 70% of whom carry laptops on airplanes to mainly write memos, review notes and work on spreadsheets.

Typically, business travelers take up about 50% of the seats on a flight -- but account for three-fourth of the revenue.

A round-trip business-class ticket on Lufthansa's Los Angeles-to-Munich flight can command up to $8,600, compared with about $1,000 in economy class. The carrier is hoping business passengers will consider the Internet access charge a modest fee.

"We truly believe this is something that the passengers will enjoy," said Jennifer Urbaniak, a spokeswoman for Lufthansa, North America.

Right now, several airlines, including UAL Corp.'s United and Cathay Pacific Airways Ltd., offer passengers a modest, limited computer service operated by Seattle-based Tenzing Communications Inc. The Tenzing system, which is far less costly to equip than Boeing's, uses telephone networks already on the aircraft to send and receive e-mails. The fees vary depending on the size of the e-mail file.

Boeing's plans to sell U.S. carriers on FlyNet were derailed by the Sept. 11 terrorist attacks.

Now, "you can imagine what an exciting time this is for us," said Scott E. Carson, president of Connexion by Boeing, the unit that has spent four years developing the service, mainly at its Seattle and Irvine offices. The unit has about 600 employees, with about 200 in Irvine. "We feel like we've finally gotten to the hospital and we're about to give birth to the baby," he added.

Sales of Boeing's staple business, commercial jets, have languished since the terrorist attacks. The company has pushed hard to diversify into other areas, such as making weapons and military jets, to buttress the ups and downs of the commercial aircraft market.

Chicago-based Boeing declined to say how much it spent developing the airborne Internet system. But in Securities and Exchange Commission filings, the company reported losses of $1.1 billion over the last three years in the "other" business category -- the bulk of which represents the new Internet project.

Though the Internet business isn't expected to be profitable for several years, Boeing believes it could generate $5 billion in annual revenue by 2010. By Boeing's estimate, there are 4,800 commercial aircraft that handle long-haul flights each day.

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