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October 4, 2005

The Remarkable Disappearance of JetConnect

The dramatis personae comprise Airbus, Tenzing, and SITA: As our story opens, a Web site's life is dramatically cut short, ripped from the ether. The last time the site was sighted (or cited) was in early 2004. Then, the big sleep.

Tenzing, Airbus, and integrator SITA created a new company called OnAir absorbing Tenzing which no longer appears to offer JetConnect in connection with Verizon AirFone. You can't find a mention on the current site of the email and instant messaging service that was, at one point, available on thousands of domestic U.S. planes operated by United and other airlines. Tenzing's past was erased.

Which might explain the strange article in today's New York Times accompanied by a stranger sidebar. The main article focuses on Connexion by Boeing's business case; Connexion is a broadband in-flight operator for Lufthansa, SAS, and seven other airlines currently using satellite for the Internet relay and Wi-Fi within planes. The article traces the history of Connexion, which began during flush airline times before Sept. 11, 2001; the company shifted strategies as the domestic carriers shed expense and long-haul international routes gained appeal.

The division won't turn a profit until 2008, the article quotes the current general manager of the division saying. I've noted many times on this site that "profit" excludes what has been estimated as billions that Boeing must already be prepared to write down at some point (or perhaps has written down in an oblique fashion already) or they wouldn't keep funding this division. Because Airbus now has its own competing service, they are practically compelled to keep running Connexion.

Here's where the article seems to parallel the missing Tenzing. The writer notes, "Airbus, Boeing's European rival, quickly countered by buying a 30 percent stake in Tenzing, a Seattle maker of in-flight Internet systems, thinking it would enable it to provide onboard e-mail in 500 planes by 2003." In fact, by early 2004, Tenzing's email system was active in something like 2,000 domestic planes by piggybacking on existing AirFone installations. I have some leftover one-flight-free kits from that marketing effort.

The article fails to mention Tenzing's current incarnation in which they will be reselling Inmarsat's fourth-generation satellites and offering units of about 450 Kbps that can be bonded into higher-speed offerings. Back when it was Tenzing, the company explained to me that they believed Inmarsat's offering was more robust than the approach Boeing was taking: Connexion relies on cells of coverage from commodity satellite transponders. Too many planes in a cell of several hundred square miles, and the total available bandwidth could drop quite a bit. Inmarsat is using beam forming to pinpoint airplanes and other ground resources, which both offers more flexibility--each plane getting essentially its own connection--but could be a victim of success in which there just aren't enough beams to go around. That's a problem any satellite company would love to have.

Then the article talks about United committing to Verizon's service which won't be available to 2007--and doesn't note that the auction for the 4 MHz in question is still up for grabs; here's my take on this from Dec. 2004. Verizon is a very likely winner of some large part of it, but there's no guarantee.

And another bit of Twilight Zone from the main article: "Meanwhile, American, Continental and Delta have no plans to add connectivity to any of their planes. "We are still reviewing it but it has not been on the front burner,' said Benet Wilson, a spokeswoman for Delta Air Lines, which sought bankruptcy protection last month.' " Continental, United, and US Airways all offered or signed up for the JetConnect service with Tenzing and Verizon. Verizon AirFone still archives the press releases.

Here's a better article from last month from Canada's Globe and Mail that covers the same scope of this main story.

The sidebar in the Times is more problematic; I emailed the author because of a few errors in it. Oddly, the errors are not in the main story that the sidebar accompanies.

First, the service isn't $9.95 per hour, easily confirmed by visiting Connexion's site. It's both more and less expensive. The $9.95 rate buys 60 minutes in a row on some airlines that offer that option, but it's only 30 minutes (non-contiguous) on the pay-as-you-go model in which additional minutes are 25 cents each. Unlimited usage per flight varies from $14.95 for flights under three hours to $29.95 for flights of six hours or more.

Second, the writer asserts that the Connexion system takes two weeks to install. This might be correct, but Connexion's sales director told me and a plane full of reporters last September (see my post) that they had reduced the installation time to seven days to fit within a routine maintenance window. Right after this point, dozens of additional planes--up from a handful--had Connexion added, so I expect that statement is true and the NY Times got this wrong. Since it's not attributed, I don't know where the detail came from in their report.

This article misses a kind of overarching issue, too: with international routes full, ostensibly profitable, and competitive, the weight factor is an issue, but so are additional paying passengers. Every airline I have spoken to about Connexion has said that they see this as a fundamental way to both poach passengers from airlines that don't offer the service and to have people fly more because they know the service will make flight time productive.

The 600 to 800 pounds of gear corresponds to three to four passengers with luggage more or less. If Connexion adds business-class fares or business travelers who will pay $15 to $30 for the Connexion service, thus covering the fuel, and hundreds or thousands of dollars for the flight, then this is how Connexion works for the airlines.

How Connexion works for Boeing involves aspects mentioned throughout both Times articles: they have to diversify outside of pure passenger services and into areas that the airlines spent a lot of money on. The telemedicine issue is large and only mentioned briefly in the sidebar: "Lufthansa, which operates about 40 wireless-enabled aircraft, is developing an application with Charité Hospital Berlin that lets doctors monitor a passenger's vital signs via a broadband Internet connection."

Each time a plane needs to land because of a passenger illness, which happens with real frequency, and it could have been avoided through good telemedicine, it can cost the airlines tens of thousands of dollars or more. There's a lot of money to be saved just through that one additional service.