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.”
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.