Boeing abandons in-flight broadband service
Connexion by Boeing grounded after disappointing results and losses
Connexion by Boeing too expsneive for some passengers
Boeing is discontinuing its Connexion in-flight broadband communication service amid spiralling costs and disappointing take-up and will write-off $320m (£169m) in its second quarter.
Connexion by Boeing offers high-speed wireless service onboard 72 long-haul planes for 12 carriers including Lufthansa, SAS and Austrian Airlines.
But only a small number of airlines installed the satellite-based service, opting for a potentially cheaper, cellular network-based service.
Passengers also complained about the price tag of up to $29.95 (£15.80) depending on the flight time.
Boeing chairman, president and chief executive Jim McNerney says the company will work with customers to ensure an orderly phasing out of the Connexion service.
‘Over the last six years, we have invested substantial time, resources and technology in Connexion by Boeing,’ he said.’ Regrettably, the market for this service has not materialised as had been expected. We believe this decision best balances the long-term interests of all parties with a stake in Connexion by Boeing.’
Boeing admitted last month that it would take a charge of up to $350m (£184.9) for the service and was considering sale of the unit.
The technology uses several Wi-Fi access points inside the aircraft to create a wireless network and the signal is transmitted back to earth via satellite. It offered up to 4Mbps speeds downstream and 1Mbps upstream.
The airplane maker said it expects the shutdown of the service and halt to investment will improve earnings by about 15 cents a share starting in 2007. Connexion employs 560 people and the majority will be deployed within the company.
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Further reading
Boeing Connexion service fails to take off