Every year we try to see if we can out guess this crazy IFE market and this year will be no different. In the past we correctly predicted portable IFE, wired in-seat portable systems and the rise of Wi-Fi. Conversely, we missed a few easy ones too like the ascension of Connexion by Boeing, the predominance of in-flight telephony R&D, and the dramatic increase in aviation in China.

So this year, we will try again to beat the pundits and this is what we see in the entrails:

We expect there to be a resurrection of in-seat power and the possible predominance of one vendor.

2006 will have more portable entrants into the IFE market, but this will be short-term. The market can only bear so many. Also, expect to see some of the earlier entrants looking at ways to transform the portable to an in-seat or pseudo installed system without affecting the 16G seat requirements.

We expect to see more and more low cost JetBlue and Song type airline entrants emerging and offering entertainment verses food services. Works for us!

We expect the lines between twin-aisle and single-aisle IFE systems to continue to be blurred with more and more scalable systems evolving.

We expect there to be a shake-up in the e-mail communication market. The industry can only have so many competitors, and so far, several have been tossing a lot of money at this market without much to show for it. We expect there to be only 2 or 3 players left when it is all said and done.

Will one of the big 3 IFE suppliers move away from building IFE hardware and focus more on applications that can cross from one competitors platform to another? We wouldnt be surprised.

Will IFE hardware suppliers and airlines finally work together and bring technologies like Bluetooth to frequent flier cards so the airlines can do real-time CRM? We hope so.

Will the airlines increase their focus on passenger portable electronic devices, such as cell phones, that have ever increasing entertainment capabilities? You bet!

This may be the year of the big, flat screen display on board. However, we think it is safe to say that it wont be the year of the big CRT display.

Be afraid; be very afraid, of Smartphones; such as Mobile PC and others with 3rd generation connectivity solutions and Wi-Fi. These devices are going to be big and if they dont make it big time this year, they absolutely will next year.

We anticipate mobile entertainment and connectivity to further expand into the automobile industry, leaving the technologists to wonder why aircraft are so wholly unconnected.

At least one engineer, if not more, will draw a block diagram of an iPod-based IFE system for aircraft.

Content DRM issues will ease because of entertainment industry initiatives.