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Saturday, June 24, 2006

Connexion : Useful Product & A Good Business

It appears that the facility to access the internet while being onboard aircrafts is being reviewed for viability. Boeing seems to think that while connection is a useful product, its not too sure if its a good business. There are reports appearing that Boeing may dump Connexion, which has failed to turn a profit in six years. Boeing has been shopping the unprofitable service around and there appear to be no takers yet. Connexion has been installed by several airlines, which have been using it on international flights. However, in the U.S., the service hasn't been approved by the FCC for domestic flights. The Boeing service uses costly satellite links - the Wall Street Journal said people in the know estimate that about $1 billion has been spent on the service so far. Connexion provides Web access and has generally been well-received by passengers who have used it. In the meanwhile,comes the news that carnival cruise is makingcellular sercice available as part of its service.While some may see that as a poor productivity mechanism to connect while being onboard, I put a premium to the availability of the service. I think every flight with a flying time for more than three hours should have this facility and probably its time to look at different ways of charging customers. A flat fee may not be the right model for this service – For someone like me doing a lot of transcontinental or long distance flights, Connexion is a dream come true and Boeing has a good chance to make this a good money earning service – in fact this may potentially become a very profitable revenue stream for Boeing moving forward if managed lot more imaginatively(variable pricing, loyalty points, co-branding etc) and promoted with lot more focus and aggression – for example flights fitted with connexion can carry a separate logo etc..

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Sadagopan's Weblog on Emerging Technologies, Trends,Thoughts, Ideas & Cyberworld
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