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August 17, 2006

Boeing puts Connexion out of its misery

Posted by Kim Peterson at 11:07 AM

Boeing is shutting down its in-flight Internet service, Connexion, which is going to cost it $320 million.

After doing a detailed analysis, the company said, it became apparent that "the market for this service had not materialized as expected." (Release here)

At first glance, it would seem like Connexion would be a screaming success. Why wouldn't you want to have e-mail, live television, phone service and Web browsing on a flight? But then the money part comes in. Connexion charged $27 for an entire long-haul flight, or $10 for an hour. That's a lot to ask, especially now that airlines are nickel-and-diming just about everything (and even encouraging their own employees to go dumpster diving to save money).

Some online reaction:

Geek Travel
: "I had tested Connexion on a flight to Detroit. It was useable, but frustratingly slow. Still, the technology is cool, and having Internet on board of airplanes is something I wouldn't want to miss."

The Cranky Flier: "In the long run, you'll never remember this existed as airlines move toward a ground-based system instead. This will probably be easier and cheaper, so Boeing must have realized it wasn't worth keeping Connexion going with no long term future."

Nick Hodge: "I wonder if the recent restrictions on carry on luggage, let alone the complexity of modern travel, has impacted their business plan."

Om Malik: "One of the biggest problems Boeing faced was lack of traction in the key US market, where many routinely travel with laptops and want to stay connected. The service, which received internet signals from Satellites and distributed them via WiFi is also facing competition from other technologies."

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