Lufthansa plans Internet access for long flights

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By ANDY PASZTOR

The Wall Street Journal

Deutsche Lufthansa AG is poised to join with a team headed by cellular-telephone giant T-Mobile to offer broadband Internet access and wireless email to its long-haul passengers, industry officials said.

Seeking to re-establish its leadership in onboard connectivity, these people said, Lufthansa has no immediate plans to allow long-haul passengers to talk on their own portable phones.

The German airline has made a preliminary decision to establish partnerships and intends to launch an improved version of in-flight Internet connections by early 2008. The earlier offering, dubbed Connexion and provided by Boeing  Co., was championed by Lufthansa but collapsed late last year after steadily piling up large losses.

The expanded replacement system - costing the partners an estimated $100 million - will allow passengers to use laptops to surf the Web, receive text messages on cellular phones and send emails on hand-held communication devices, according to industry officials. With other European carriers scrambling to roll out cellphone service on short-haul routes, Lufthansa seems headed in the opposite direction.

Without commenting on the status of its overall plans, airline spokesman Michael Lamberty said Lufthansa passenger surveys showed that "the vast majority told us they don't want this feature" because of the noise and intrusive telephone ringing it could entail.

Industry experts consider the planned service to be the most capable and flexible to bring broadband-and-wireless services into jetliner cabins.

Spokeswomen for Lufthansa and T-Mobile, a unit of Deutsche Telekom AG, declined to comment on the status of discussions. Lufthansa, which had more than 65 long-haul jets outfitted with Boeing's Connexion hardware, has said the service was highly popular with business travelers.

European low-fare carrier Ryanair Holdings PLC is looking to join forces with other partners and technologies to eventually offer cellphone calling across much of its short-haul fleet. Air France-KLM SA, British Midland Airways Ltd., TAP Air Portugal and Emirates Airline are among the carriers considering a future mix of onboard voice, messaging and Internet services.

In the U.S., where regulatory hurdles continue to restrict cellphone uses on planes, Southwest Airlines  Co. and Alaska Air Group Inc. appear to be among the furthest along in analyzing options to provide wireless services.

Lufthansa's plans are being shaped partly by hard-to-predict social factors, such as passenger reactions to anticipated noise and interruptions stemming from airborne cellphones. On long-haul routes, the concept of voice services "really seems to have slowed down recently," primarily due "to worries about how premium passengers would react," said Tim Farrar, a satellite-industry consultant in Menlo Park, Calif.

While Lufthansa's own plans are tentative and subject to approval by the parent company's board, people familiar with the carrier's strategy said cost-sharing and implementation talks are under way with T-Mobile, Luxembourg satellite-operator SES Global SA and equipment supplier Viasat Inc., of Carlsbad, Calif. SES and Viasat declined to comment.