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Southeast Airlines passengers may soon get to surf the Web wirelessly and talk on the phone throughout a flight.
Southeast, a small charter airline located in Largo, Florida, has signed an agreement with SkyWay Communications Holding to offer free Wi-Fi Internet service, and phone calls for as low as 50 cents a minute. While it still needs the approval of federal regulators, Southeast would become the first U.S. airline to offer wireless Internet service and relatively cheap phone calls through seat-back phones.
There is one caveat to the Internet service: Passengers would have to endure some advertising in order to get it.
"We would take over the audio and video right on the aircraft, and sell advertising on the plane," said David Huy, SkyWay's vice president of sales and marketing. "It would be both pop-ups and banner ads for the Internet access, and then we'll have advertisements with the usual sitcoms and whatnot on those drop-down TV monitors.
"We will be sharing the revenue with Southeast. The advertising revenues would be fairly substantial, so they will be getting a piece of that," Huy said.
Southeast's vice president of planning, Scott Bacon, would not comment on the financial arrangement between his company and SkyWay. He said he did not know how the technology worked or when the Federal Aviation Administration would approve it. Nonetheless, he expressed enthusiasm for the newly formed alliance.
"This is new technology," he said. "That's why it's so exciting for us."
Business travelers, too, are excited at the prospect of surfing the Web and talking on the phone affordably while flying.
Right now, in-flight communications options for passengers are pretty limited. Passengers aren't allowed to use their own cell phones because the devices might interfere with either onboard or ground communications systems. Using specially designed seat-back phones is prohibitively expensive -- Verizon charges $2.50 a minute, plus connection fees.
Jerry Weltsch, an analyst with market research firm Frost & Sullivan, said people might use the seat-back phone, but "once they got the credit card bill, they'd never do it again."
Wireless broadband Internet access has been limited to trials on Scandinavian Airlines and Lufthansa of Germany. The European airlines don't plan to offer the service on all their aircraft until at least the beginning of 2004.
Both United Airlines and Continental Airlines sell passengers dialup Internet service for $16 a flight by leveraging Verizon's seat-back Airfones. No major U.S. airline has unveiled plans to offer faster wireless broadband service because the FAA hasn't approved its use.
The FAA has commissioned the RTCA, a private nonprofit group in Washington, D.C., to study the effects of wireless technology -- Wi-Fi, cell phones, pagers and other wireless gear -- on equipment used to operate planes. RTCA isn't expected to release its findings until November 2003.
"We don't have an opinion yet on any of these new technologies because we need the information the RTCA committee is looking at," said FAA spokeswoman Alison Duquette.
Nonetheless, SkyWay has conducted tests of its own and is confident it will receive the FAA's approval at around the time the RTCA releases its results.
"November, really, wouldn't be that bad because it would fall within our time line," Huy said. "We're probably looking at six to nine months before the installation is complete."
SkyWay, a newly formed company in Clearwater, Florida, plans to build its business around AT&T Wireless' now-defunct seat-back phone service. The Florida company snapped up some of AT&T's ground base stations earlier this month to power the Internet on the plane. It plans to add Wi-Fi access points throughout Southeast's cabins so passengers with Wi-Fi-enabled laptop computers and PDAs can get their e-mail and surf the Web wirelessly.
SkyWay plans to sell phone calls through airplane-installed telephones, but at a much lower rate than Verizon -- around 50 cents a minute with no additional connection fees, Huy said.
"Our biggest source of revenue will be the advertising rights," he said.
Unlike Lufthansa and Scandinavian Airlines, which plan to charge passengers $25 to $35 a flight for Wi-Fi, SkyWay plans to offer that service for free.
But some business travelers said they weren't crazy about the thought of becoming an advertiser's captive audience.
"I would rather pay for it," said Scott St. Onge, a political financial adviser who recently flew into San Francisco from Washington, D.C., for a conference. "I'd pay $10 or $15 a flight. I pay $5 to watch a movie."
Mac Gordon, a spokesman for the Mississippi House of Representatives who recently was at the same San Francisco conference, said he would not like the advertising forced upon him.
"I would rather have the option" to pay for it, he said.
As for cheap phone calls, many business travelers would welcome the service. But some other passengers would be bothered by the constant yapping, said David Stempler, president of the Air Travelers Association, a Washington, D.C., consumer advocacy group for airline passengers.
"The Internet would be well-received," Stempler said. "The one issue that will come up with this service is the use of cell phones in airplanes while in flight. Amtrak trains on the East Coast have had to set up quiet zones because people found cell-phone conversations to be intrusive. That will become an issue on airplanes as well."
