Internet customers of Hong Kong telecommunications group PCCW Ltd. will be able to fetch their e-mail in aircraft operated by Cathay Pacific Airlines Inc. under a new service announced by airborne Internet service provider Tenzing Communications Inc. [Note to editors: This story was previously posted under embargo and is now available for immediate use.] "Our airborne messaging service will be available to PCCW's 1.2 million Internet customers on 41 Cathay Pacific planes, which we have already equipped, and on the airline's entire fleet of 69 aircraft by the end of the year," said Tenzing Chief Executive Officer (CEO) Alan McGinnis. "We will offer the service free of charge for two to three months while we work out any technical glitches."
When the service goes commercial, McGinnis said e-mail fees will range between US$10 and $20 per flight, with large attachments to be charged separately.
The Tenzing system sends and fetches compressed e-mail from its onboard proxy computer via the aircraft's satellite transceiver every 15 to 20 minutes. Customers connect their laptops to the onboard LAN via a USB (Universal Serial Bus) cable, which they plug into a socket fitted in their seat.
In addition to Cathay Pacific, Tenzing in Seattle, Washington, is testing its in-flight messaging service with Virgin Atlantic Airways Ltd. and has inked a contract with another major airline, according to McGinnis. "We expect to announce that deal within the next two weeks," he said.
PCCW is the first ISP (Internet service provider) to partner with Tenzing, which had once hoped to become an ISP itself and sell directly to business and leisure travelers, McGinnis said.
In October, Tenzing scraped its ambitious consumer Internet plans in favor of a more narrowly focused strategy that sees the company cooperating with established ISPs and enabling their customers to send e-mail while flying, according to McGinnis, a former Microsoft Corp. executive. "As an ISP, we would have had to solicit customers, bill and support them and spend heavily on branding," he said. "We didn't want to fall into this money pit."
Web surfing is another victim of the scaled-back strategy, which now focuses almost entirely on e-mail and a short messaging service available through seat-back video screens, according to McGinnis. "There is a substantial cost to providing real-time Web surfing, and we don't think airlines are willing to pay for it in this economic climate."
Initially, Tenzing aimed to bundle high-speed Web browsing and e-mail. But the airlines, hit by the dramatic slump in air travel after the Sept. 11 terrorist attacks in the U.S., balked at making the investments necessary to provide the high-speed transmission links.
Now the company hopes to attract airlines to its in-flight Internet service by taking advantage of existing radio systems to keep investments at a bare minimum. "We're talking about tens of thousands of dollars and a matter of hours to upgrade aircraft versus hundreds of thousands of dollars and days," McGinnis said.
With an eye on costs, the company recently tested live Web browsing and access to corporate VPN (virtual private networks) at speeds up to 64K bps (bits per second) on select aircraft using standard L-band satellite communication antennas. Customers willing to pay a premium price for the real-time service will receive dedicated links. "We don't expect huge demand for this service because of the cost, but we want to make it available to those airlines that want to differentiate themselves with new in-flight services," McGinnis said.
Having reluctantly shelved Tenzing's broadband Internet plans, McGinnis agrees that high-speed Internet in the sky is the future. "There is no doubt that broadband Web surfing is where airborne communications will go," McGinnis said. "It's just a question of when and at what price. We'll compete on this front when the time is right."
Wireless LAN (WLAN) technology will also play a role the group's strategy "once the technology has been certified by the FCC (Federal Communications Commission) and the FAA (Federal Aviation Administration) in the U.S." and airlines are prepared to invest in the necessary infrastructure, McGinnis said.
Tenzing's main competitor Connexion by Boeing, a unit of The Boeing Co. in Seattle, Washington, is currently testing a broadband service on two European airlines - Lufthansa AG and British Airways PLC - on single Frankfurt-to-Washington and London-to-New York flights, respectively. The two airlines have forged ahead with their plans to offer Internet connectivity onboard their aircraft despite a decision by Connexion's three primary airline partners to abandon the venture in November 2001. The former partners, American Airlines Inc., Delta Air Lines Inc. and United Airlines Inc., withdrew their financial support after they incurred severe financial losses following the terrorist attacks. [See "Three airlines to drop Boeing's Connexion service," Nov. 29, 2001.]
Major shareholders of Tenzing are European aircraft manufacturer Airbus Industrie SA and aviation electronics maker Rockwell Collins Corp.-- IDG News Service