By Joe Brancatelli
The future of in-flight Wi-Fi according to Lufthansa: About 650 domestic jets have been equipped with Aircell’s GoGo in-flight Wi-Fi service nut, but for all the publicity it has generated, there is very little evidence that travelers are interested in buying. The so-called “take” rate on flights is only about five percent — and an unknown (but large) portion of those fliers are surfing free thanks to some promotion or other.
Yet one international carrier has remained a supporter of in-flight Wi-Fi even when the product literally didn’t exist. Lufthansa was the largest customer of the Boeing Connexion service, which collapsed in 2006 with perhaps a billion dollars in losses for the plane maker. Lufthansa searched for a replacement over the last three years (international in-flight Wi-Fi requires an expensive, satellite-based overwater system, unlike the land-based GoGo) and it thinks it’s found one.
Beginning in the middle of next year, Lufthansa will revive its so-called FlyNet service on flights using equipment provided and serviced by Panasonic.
“We look at this from the long-term strategic perspective,” says Don Bunkenburg, a U.S.-based Lufthansa executive. “In the beginning, I don’t see in-flight Wi-Fi as a profit center. I see it as a brand differentiator. In the long term, though, travelers will be willing to pay for it.”
According to Bunkenburg, the Wi-Fi will first appear on flights over the North Atlantic because “the majority of our [North Atlantic] fleet already has the equipment on board.” In other words, Lufthansa is hoping to re-use the Boeing Connexion equipment, which the airline never removed. Bunkenberg says 64 out of 95 planes in Lufthansa’s long-haul fleet already have much of the necessary on-board equipment.
The future of international in-flight Wi-Fi may not look much like the past, however. Bunkenburg says Lufthansa expects “a lot more travelers using mobile devices than laptops, especially in the beginning.” Mobile devices equipped for Wi-Fi literally did not exist when Connexion was operating. And while pricing for FlyNet hasn’t been set, Bunkenburg did acknowledge that Lufthansa is looking at offering it free to premium-class passengers. “It’s part of what we’re looking at,” he says. “We haven’t reached any conclusions. There are multiple pricing strategies being examined.”
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Joe Brancatelli is editor and publisher of JoeSentMe.com, a non-commercial Web site for business travelers. Copyright 2009 by Joe Brancatelli. Licensed by contract for Orbitz use.