Lufthansa is finally nearly ready to announce a deal long in the making: I've been hearing private noises and reading articles citing insider sources for a couple of years that Lufthansa would return to offering in-flight Internet service following the demise of the Connexion by Boeing service in 2006. The airline equipped dozens of planes, far more than the second-most unwired airline that worked with Boeing. (Update: Lufthansa has made its announcement, but with details.)
With Row 44 signing and Aircell installing its service on hundreds of domestic U.S. aircraft, it was a wonder why Lufthansa couldn't pull the pieces together. A couple of years ago, Panasonic Avionics announced a plan to bring back Ku-band satellite service like Boeing's with higher speeds, much lower costs, and a much smaller package with lower drag for the antenna. However, Panasonic needed a core set of committed planes to get going--and that was before the economic collapse in 2008.
The Wall Street Journal reports that Lufthansa and Panasonic are finally together, with an announcement due Monday, and a plan to equip all 120 long-haul planes Lufthansa operates. If I recall correctly, Lufthansa had put Connexion service on nearly 70 aircraft. The article says that Lufthansa is using heavy antennas (calling them antennae for some insectival reason), which may mean the airline still has the Connexion gear installed on the airline's skin. Newer Ku-band antennas are sleeker, offer much less drag, and are much lighter and cheaper.
Lufthansa's offering will include cellular calls as well as Internet access, and the Journal says calls will be about $3/min., which isn't far off cellular carriers' horrible international roaming rates, nor what OnAir charges for in-flight calls. (OnAir leaves precise pricing to the carriers that allows customers to place calls on planes, just as any other roaming operator.)
Internet service will cost $12/hr or $22/day, which is cheaper than the initial Connexion rate, but above what I would argue makes sense in the current business climate. In-flight Internet service must work for frequent flyers, who will not pay those rates each time they fly. Pricing has to be tied directly into recurring rates with corporate plans, tied into home-office single-login, single-bill services, either run by Fortune 500s or firms like iPass and FiberLink.
The Journal reporters seems to place blame on Lufthansa for putting so much effort into Connexion. I'm not sure why the airline has to be painted as a chump.