Thursday, September 09, 2010

Southwest Airlines Moving Steadily Ahead on In-Flight WiFi

Southwest Airlines now has 13 of its 737s with WiFi installed and activated and says it expects to have more than 60 planes outfitted by the end of the year. After that the airline expects to continue rolling out WiFi throughout its entire fleet of 547 Boeing 737s.

Southwest has partnered with the tech company Row 44 on its WiFi venture. All of the other domestic airlines that have installed WiFi so far have used Aircell's Gogo branded system. As of last week, there were 1,000 domestic mainline aircraft in which the Gogo system had been installed.

Alaska Airlines tested Row 44 but decided earlier this year to go with Aircell's Gogo instead.

Oddly, Aircell's system is air to ground, meaning it depends on land towers and thus does not work on overseas flights. Row 44, the Southwest partner, has a satellite-based system that works over the ocean -- but Southwest does not fly overseas.

While there are competing claims, Row 44's executives have told me that their system simply provides better broadband service, and that's why the hard-nosed Southwest is going with it.

At the annual conference of the World Airline Entertainment Association in Long Beach, Calif., which starts on Sunday, I'll be eager to hear more about the state of this nascent industry from the people who know.

Meanwhile, I remain a skeptic about in-flight WiFi. To date, I have seen no evidence that more than about 7 percent of passengers, on average, have been opting to pay for the service on flights. (Virgin America, which flies a techie-heavy route between San Francisco and New York, says that up to 12 percent of passengers have opted for the Gogo service on that route.) And I wonder if Continental Airlines, the only major airline that hasn't signed on with either Aircell or Row 44, might have the right idea, in its plan to test a lower-level service that provides just e-mail and texting in-flight.

On the Southwest blog, the airline's marketing VP, Dave Ridley, says of the Row 44 choice: "Southwest bucked the in-flight WiFi trend when it chose Row 44’s satellite solution over the air-to-ground service selected by several of our competitors. Choosing this cutting-edge technology meant a delay in installation but, in doing so, we are in complete control over the customer experience and able to provide a robust service at a great value."

Southwest has not yet spelled out what that "value" is. The competing Aircell Gogo service has been heavily promoted with discounts and other offers from airlines and from third-party marketers.

Ridley says that pricing announcements will be coming in the fourth quarter, along with the "unveiling of a newly designed portal that all WiFi Customers will be able to access free of charge."

Uh, you can read that one as I do. The "newly designed portal" will be advertising and marketing. Free!


[UPDATE: On the other hand, I do think that in-flight WiFi has a viable market in business aviation, which Aircell has been assiduously courting in the last year or so. Flexjet, a division of Bombardier, said today that it will offer the Aircell Gogo Biz service on all of the planes in its fractional-share fleet at no additional charge. Installation of the Gogo Biz system will start on Flexjet's 25 Challenger 300s and seven Challenger 604/605 jets.]


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