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Onboard Wi-Fi to generate $1.5 billion for airlines by 2015

January 22, 2012|By Hugo Martin
(Los Angeles Times )

There is good reason why the nation’s airlines are moving quickly to make wireless Internet an increasingly common onboard service, along with drinks, food and movies: It generates more revenue from fees.

Onboard Wi-Fi use grew from 4% in 2010 to 7% last year, and is expected to generate up to $1.5 billion annually by 2015, according to a study by In-Stat, an Arizona market analysis company.

About 45% of the nation’s commercial air fleet is equipped with in-flight wireless Internet, with several airlines, including Virgin America and AirTran, offering the service fleetwide, according to In-Stat.

The nation’s airlines collected about $155 million in 2011 from charges to use onboard Internet and are expected to collect $225 million this year, said Amy Cravens, a senior analyst for In-Stat.

As onboard Wi-Fi spreads throughout the industry, the study suggests that airlines will find more ways to make money from it, including new fees for Internet phone calls and video chatting from 35,000 feet in the air.

"The future of in-flight Wi-Fi will be less about convincing airlines of the merit and more about leveraging the network to provide a broader breadth of services," Cravens said.

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