Profile: Making the In-Flight Connection

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  Space News Business

Profile: Making the In-Flight Connection

By PETER B. de SELDING
Space News Staff Writer
posted: 16 June 2009
01:34 pm ET






David Bruner

Vice President, Global Communications Services

Panasonic Avionics Corp.

Providing airline passengers access to the Internet and live television on their laptops and mobile phones while airborne is an idea so compelling that Boeing Co. spent six years and $1 billion trying to make the satellite-enabled business work.

In the summer of 2001, with several major airlines signed on as partners, Connexion by Boeing was poised for takeoff. But after terrorists crashed passenger planes into the
World
Trade
Center
and the Pentagon, the airline industry was sent reeling, Connexion struggled to gain altitude and Boeing ultimately abandoned the business in 2006.

Panasonic Avionics Corp. has taken a long look at Boeing’s Connexion experience and concluded that it can apply lessons Boeing learned the hard way and make the idea finally fly.

But Panasonic’s eXConnect project – video, wireless telephone and broadband access to passengers and crew – has encountered headwinds almost as serious as those that slowed Boeing. With the global economy in recession, airlines are seeing reduced passenger traffic and falling revenue.

The
Lake Forest
,
Calif.
, company expected to have more than 300 planes fitted for eXConnect by now. Instead, the service is hoping for 200 planes to be equipped by late 2011. The company attributes the revised forecast in part to a decision to redesign the antenna that will be installed on aircraft to enable the satellite link.

Panasonic has leased Ku-band satellite capacity to provide coverage on 95 percent of commercial air routes, and thinks its business model is tough enough to withstand the current downturn.

David Bruner, the company’s vice president for global communications service, said he is especially bullish on eXConnect now that Atlanta-based EMS Technologies has finished design work on an antenna that Bruner insists is a game-changer. Bruner spoke with Space News staff writer Peter B. de Selding.

How would you describe the status of eXConnect given the current economic slowdown?

We have definitely been affected by the global recession. But our biggest challenge recently has been the technology, not the overall economy, and relates to our antenna. To assure that we are able to get a lot of bandwidth at reasonable prices, we took an extra year to develop an antenna that would give us superior performance.

Despite these challenges, there are airlines that are going forward, and given our own development of technology ends and the marketing constraints of having to start around nine months before full introduction, I would say we are moving at pretty close to maximum capacity.

How is marketing a constraint?

It takes a huge amount of planning for an airline to prepare this. You want to wait until a certain number of aircraft have been outfitted with the system before you engage in a marketing campaign, and educating everyone involved as to what the system can do and how to market it has been a big challenge for us.

Whose job is it to do the early marketing?

It’s partly Panasonic, and partly the airlines. It sounds simple, but it’s not. Once we get deep into a fleet, and customers begin expecting the service, it will be a lot easier. It’s the early introduction that is the hardest part.

Who is the customer-facing entity – the airlines or Panasonic?

It is the airline. But the fact is you cannot expect cabin staff to be IT experts, and to know details about the system’s performance and what to tell customers if it isn’t working because, say, the plane is flying at 80 degrees north latitude, for example. The goal is that the system is just as obvious as the WiFi networks at the airport. You open your PDA or laptop, and it tells you what networks are available, and you click on one.

What does your antenna provide that others don’t?

Narrow beam width, particularly in the
Americas
where you have lots of Ku-band satellites.
Around the equator, there is the potential of interference from adjacent satellites. The issue is not just throughput, it’s also efficiency. We can use less bandwidth per megabit per second delivered, and that vastly improves the economics. Our assessment is that the antenna we have developed is twice as good as others on the market in terms of bandwidth efficiency.

This means you can lease less satellite capacity per megabit delivered to the customer?

Yes. We paid a price for taking the extra time to develop it, but it’s worth it. We really couldn’t be more pleased with the product. Customers care a lot about the cost of the service and this will help us keep prices down.

How much capacity will be available per aircraft, on average?

Between 15 and 30 megabits per second for voice, video and data links. We can deliver more depending on the application. For example, if the system is notified that there is a telemedicine application needed on board – a passenger is ill and needs medical care – we can automatically set that as a priority. The same goes for engine data or other priority uses: We can concentrate capacity for them.

How much time does an aircraft need to be taken out of service to install your system?

There’s a learning curve where the first installs will take longer than when an airline is in the middle of a fleet. It takes about two days and can be done during the monthly “A”-check maintenance. Surprisingly, it’s not the antenna or the broadband access that takes longest, it’s the installation for GSM phone use. That’s the most invasive part of the installation. The broadband antenna takes less than 24 hours to install.

Is GSM mobile-phone access a big part of the business model?

Yes it is. We expect it will be around 50 percent of the revenue and only a small percent of the total system cost, judging from our experience so far. What the airlines are thinking about is allowing mobile phone access for, say, the first couple of hours of a flight, and then shutting off that service. The broadband and messaging access can continue. This is done automatically, so you almost make system operation independent of the crew.

Did Boeing’s failed Connexion project make it easier for you?

Yes, it’s nice to come along second. We learned an awful lot from what Boeing did, and one thing we learned is to manage consumer expectations. Also, the technology has moved on since Connexion by Boeing. We can now polish it instead of reinventing a lot of things. We can monitor system performance from the ground and direct capacity from one use to another if needed.

What about pricing? Are you adopting Connexion by Boeing’s strategy?

They were priced too high in our view. We are setting prices at $21.95 for 24 hours of use, and ultimately as fleet rollout improves we can get prices down from there. So we are starting at levels that are already less than some hotels charge for WiFi access. We are also offering different pricing for texting, and an hourly rate of $11.95. We will also have pricing for 30 minutes of use for regional markets. For heavy travelers, we will have monthly subscriptions as well.

Are you using any of the hardware that was developed for Boeing’s Connexion?

For one customer we are using Connexion antennas. They are not as good as the antennas we are developing but we’re going to take advantage of the existing development.

What is your current satellite coverage area under contract?

One of the benefits of the way we have set this up is we don’t have to rent a full transponder. We can rent partial transponders while the business ramps up, and then add capacity as demand requires. We now have around 95 percent global coverage of commercial airline flights. We have leased capacity from Intelsat, Telesat and Eutelsat. Connexion by Boeing had about 65 percent global coverage. The only area we are missing now is over Russia, and we are waiting for satellite capacity to come on the market. I’d like to see a bit more overlap in our coverage.

Inmarsat

is using L-band with satellites positioned to permit full coverage over the oceans from its own satellites. You are leasing capacity on Ku-band satellites designed to cover the land masses. Are you at a disadvantage?

The newer satellite designs are giving us broad beams for mobility applications in Ku-band, so I don’t see the coverage issue as an issue. It’s true that L-band permits the use of smaller antennas, and a simpler installation. Our big advantage over L-band is price per megabit delivered. It’s really no contest on that point.