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In-Flight Broadband Market to Generate $936-Million Annually by 2012

Date: 7/1/2008 3:32:48 PM

The market for in-flight broadband internet services will surge to $936 million annually by 2012, as airlines continue to invest in new entertainment services in hopes of generating additional revenue, according to a recent study by MultiMedia Intelligence (MMI).

Researchers expect in-flight broadband to generate worldwide passenger revenues of just $6.6 million in 2008, but take off sharply in the years to come.

Although the first generation of in-flight ISPs focused almost entirely on business class passengers, providers are now increasingly intent on targeting coach class leisure travelers. This change in strategy is largely inspired by research demonstrating a strong correlation between in-flight web access and the on-ground Wi-Fi hotspot market, with is 50% consumer driven.

“In-flight broadband is entering a new era,” explained MultiMedia Intelligence contributing analyst, Amy Cravens. “Since Boeing ended Connexion several years ago, in-flight broadband has seemingly been void of activity. However, during this lull, several initiatives to re-launch in-flight broadband have been under way, as industry players prepare to launch in-flight service.”

There is currently a technology “format war” of sorts going on in the in-flight broadband market as some providers offer services using air-to-ground (ATG) cellular technologies and others promote satellite-based services. There is also some division as to whether to start with less costly narrowband internet solutions, or jump directly to a highly robust and future-proof high-speed internet service.

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