Broadband access at 35,000 feet above the ground?
Row 44 Inc., a Westlake Village-based startup, says it can make that happen. For two years, the company has been developing an in-flight Wi-Fi system.
The company recently got a big break when Alaska Airlines signed it up for a trial run, which will end next spring. If that is successful, Alaska will equip its entire 114-aircraft fleet with the technology. Row 44 executives said they are in talks with other major carriers to roll out similar trial runs.
"The Internet is everywhere else," said Row 44 President Gregg Fialcowitz. "Airplanes are the last frontier of the Internet."
Row 44 isn't the only company attempting to stake its claim in this new frontier. AirCell LLC, a Colorado provider of aviation communication systems, will equip American Airlines and Virgin America with high-speed broadband access by next year. But AirCell uses ground-based antennas that don't work over the ocean; Row 44 uses satellites that work over land or sea.
Row 44's technology piggybacks on broadband giant Hughes Network System's satellites. It installs a server and modem in each aircraft's ceiling, and they communicate with Hughes' network operating centers. As a result, the aircraft becomes a wireless "hotspot."
Passengers can log on as they would at home or at coffee shops with wireless access. For domestic flights, they would pay about $6 for unlimited Internet access for handheld devices and about $8 for laptop computers. International flights would be more expensive.
It sounds straightforward enough, but the in-flight broadband technology has already seen one high-profile failure.
Last year, the industry gawked as Boeing's $1 billion in-flight wi-fi venture Connexion tanked. The main problem was that its servers weighed five times that of Row 44's 150-pound servers and were too big to fit on single-aisle jets like 737s. So the service was limited to the two-aisle jets. To make matters worse, data flow was relatively low. Ultimately, revenues trickling in from a dozen airlines, such as Lufthansa, were not enough to keep the business afloat.
In the five years since Boeing launched Connexion, technology has improved significantly. Antennas are lighter and cheaper and servers are faster.
Row 44 plans to avoid the infrastructure costs that plagued Connexion by using the Hughes system across the world. The company has an exclusive 15-year contract with the satellite provider.
"Boeing built a large hole they couldn't get out of. We decided we're not digging that hole," said John Guidon, Row 44's chief executive. "We're riding on top of an already profitable service."
Skepticism in air
Lars Ringertz, spokesman for London's satellite communications company Inmarsat PLC, which has provided broadband service to Air Force One for years, is skeptical. He said companies like Row 44 that lease transponders will have a difficult time surviving.
Transponders are basically beams from the satellites, a kind of wireless capacity shared among aircraft. It costs about $1 million a year to lease one transponder of good quality, he said.
"If you assume you need to service 50 aircraft, you're going to have to charge a lot of money to provide that service because you need more transponders to service those aircraft," Ringertz said. "Boeing couldn't do it."
Connexions reportedly spent about $50 million a year on transponders to support about 100 aircraft.
Inmarsat is rolling out its own in-flight connectivity service called SwiftBroadband that will use its own satellites to offer broadband access, so it won't have to lease the expensive transponders.
If companies like Row 44, AirCell and Inmarsat are successful, they will be meeting a huge demand. Surveys indicate that as much as 70 percent of passengers want wireless Internet on airplanes. The value to business travelers is clear.
Fialcowitz said he realized how to address this pent-up demand while running his previous L.A.-based business that used Hughes to bring satellite TV over telephone wires for apartment buildings that couldn't access satellite dishes.
"I thought, if we could bring Internet access to apartments via satellite, we should be able to do the same thing for aircraft," he said.
Fialcowitz teamed up with serial entrepreneur Guidon to land an exclusive contract with Hughes.
"We basically asked Hughes if we could make an aircraft look like a house in terms of wireless access, and they got it right away," Guidon said. "It was a low-impact decision for Hughes and a low-overhead one for us."
With a dozen employees, Row 44 is a startup with no significant revenues. It is funded by private investors.
The name Row 44 comes from one of Guidon's first experiences on an American aircraft as a British teenager backpacking through upstate New York.
He was on stand-by at the John F. Kennedy International Airport on a hot summer day and ended up on the last row of an aircraft row 44.
"I was tired and sweaty. I was next to the toilet, directly under the engine on seats that couldn't lean back," Guidon said.
"Our technology is all about doing something for the poor guy stuck on row 44 that might make his journey a little better."
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