Frost & Sullivan: In-Flight Entertainment and Connectivity Market Grows

(Wireless News Via Acquire Media NewsEdge)
The world in-flight entertainment and connectivity (IFE&C) market
continues to grow as airlines install new equipment or upgrade their
systems, report Frost & Sullivam.

Current fleet upgrades and increasing orders for commercial aircraft
and business jets indicate a strong market potential for IFE&C systems.
For instance, the commercial aircraft orders of Airbus and Boeing
reached an all time high of 2,754 in 2007, with the Asia Pacific and
Middle East regions generating the majority of new orders.

New analysis from the consulting firm, World In-flight Entertainment
and Connectivity Market - Investment Analysis, reveals that this market
earned revenues (top 20 participants) of $1.68 billion in 2007 and
estimates this to reach $2.72 billion in 2012.

An increasing number of airlines are now looking at IFE&C as a source
of non-seat revenue, says Frost & Sullivan Industry Analyst Rani
Cleetez. Numerous pilot programs are underway, with JetBlue Airways
testing free e-mail and instant messaging services on one of its planes
which started in December 2007. Once successful, JetBlue is likely to
charge a fee for the utilization of its Internet services.

In a release Frost & Sullivan notes that additionally, American
Airlines, Virgin America, and Alaska Airlines plan to offer broader Web
access in 2008. Besides sharing the revenues from these fees, airlines
could potentially earn money from advertising or use the cabin's Wi-Fi
network to enhance their operations.

The easing of regulatory restrictions on voice and data solutions for
aircraft will drive the IFE&C market. In 2007, the European Aviation
Safety Association (EASA), the European equivalent of the Federal
Communications Commission (FCC), ruled that mobile phone technology had
no discernable impact on commercial jet navigation and communications
equipment. In early 2008, EASA and the UAE-based General Civil Aviation

Authority (GCAA) granted full approval for voice connectivity aboard
the AeroMobile, which enabled the company's systems to be installed
successfully on Emirates.

However, rising fuel prices and the U.S. economic slowdown are
overshadowing the global aerospace markets and could hamper the growth
of the IFE&C markets worldwide, says Cleetez. High operational costs
and the financial crisis among the U.S. airlines are major restraints
when it comes to the growth of the IFE&C market in the United States.

Economic or social changes outside of India and China s region will not
greatly affect their booming economies, thereby minimizing the risk
level related to investing in these markets. After the impending
bankruptcy filings and consolidation of U.S. airlines, the market
situation is likely to change and the IFE&C market will grow steadily
over the next five years. The economic downturn in the U.S. has been
taken into consideration while preparing revenue forecasts for this
research.