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Summary:

Is it a case of don’t trust the early adopters? Boeing’s Connexion “broadband in the sky” service received rave reviews from most of the early adopters who wrote long paeans about the service, and how they could Skype and work in the sky. The mass market […]

Is it a case of don’t trust the early adopters? Boeing’s Connexion “broadband in the sky” service received rave reviews from most of the early adopters who wrote long paeans about the service, and how they could Skype and work in the sky.

The mass market thought otherwise. Boeing today decided to shut down the service and is taking a $320 million charge, as it writes down the assets and pays termination fees to the customers. All Nippon Airlines, Japan Airlines, SAS, Singapore Airlines and Lufthansa are three airlines with live Connexions. This should not come as a surprise, since the company has been shopping the service for a while. The decision is also bad news for Colubris Networks, one of the key equipment providers to Boeing.

“Over the last six years, we have invested substantial time, resources and technology in Connexion by Boeing,” said Boeing Chairman, President and CEO Jim McNerney. “Regrettably, the market for this service has not materialized as had been expected. We believe this decision best balances the long-term interests of all parties with a stake in Connexion by Boeing.”

One of the biggest problems Boeing faced was lack of traction in the key US market, where many routinely travel with laptops and want to stay connected. The service, which received internet signals from Satellites and distributed them via WiFi is also facing competition from other technologies. JetBlue, for instance has won special licenses that all allow it to deploy wireless broadband on its jets and offer communication services. It remains to be seen what happens to that service.

  1. Replace connexion with web2.0 and throw in the word investors in a few places and the story will read the same.

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  2. .. and it disappeared before I could even try it out. I’d even pay $10 a flight to get wifi access (of course, it would be necessar for seats to have power supplies).

    This might all be moot if laptops are banned on planes.

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  3. the laptop on the planes problem might have been the kicker here and pushed them over the edge and decided to throw in the towel. however in seriousness, i think lack of US market penetration is what really was the issue. No one loves their laptops more than the Americans.

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  4. I thought you were referring to he new site Boeing, Boeing, Gone :)

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  5. There isn’t enough data to say what the adoption problem was but I agree that support from US business travellers would have helped.

    Perhaps some marketing/product changes would have helped such as:
    - Bundling a nominal service charge into every transcontinental ticket price (a small % relative to the ticket price)
    - Giving the first 20-30min free for all users to try out the service.
    - Offering better entertainment options via the broadband connection (local streaming media server on the plane) so that you’re not forced to see the often weak movies being shown.
    - Processing your immigration paperwork online and having a printout delivered to your seat an hour prior to landing.

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  6. This doesn’t make any sense. The JetBlue offering sounds identicial. What exactly was Boeing offering and on what routes? I’d easily pay $10-20/flight for net access. Was there really less up-take than for GTE Airphones?

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  7. Great idea. Terrible implemetation.

    If you want US traction, it has to be AVAILBALE in the US. And I DON’T mean European/Asian long-hauls originating/terminating in the US. It had to be available on the Raleigh-Denver flights in addition to NY-LA. It has to be fleet-wide and reasonable ($9.95).

    This was idea that had to be deplyed o a massive scale before it was going to “take off” (no pun intended).

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  8. I fly fairly regularly, once or twice a month, and I heard them announce WiFi availability on the plane for the first time when I flew JetBlue a few weeks ago. Does AmericaWest and Continental just not have the service available?

    Of course they are going to have terrible penetration if no one knows it’s available. The flight attendants still tell you that any sort of wireless device has to be shut off during flight, with out mention of it being allowed for Wireless Internet access available on the plane!

    It seems to me that they mothballed this product too early. They should have tried to determine why it wasn’t selling and to address those problems!

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  9. I agree. I have never been on a plane that offered wifi, so to some extent US adoption never materialized, since US business travelers were never really given the option of trying the service out. I am on a plane from one coast to the other 2-3 times a month. I am sure there are others who travel way more than that. Did United, American, Delta, etc even give this a try on some routes? Not to my knowledge.

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  10. I have not seen this service offered in the U.S. As a business traveller, I would love to have — and would pay for — easily accessible wireless internet, and cell phone services on a plane. This would be an enormous competitive advantage for any airline that could supply it. Given the fact that Boeing is building planes for most of the airlines, would seem they had the leverage to get their service adopted. Oh well, guess its time to fly JetBlue.

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