Will airplane Internet service take flight? SEATTLE (Reuters) =97 With a business model that combines air travel and=20 Internet service, Tenzing Communications has endured serious turbulence in= =20 recent years. But fresh off a cash infusion from investors in December,=20 Seattle-based Tenzing has scaled back its airborne Internet service to=20 offer a simpler system to deliver the one thing it claims Web surfers=20 really want at 35,000 feet: e-mail. "Our surveys show 86% of people log on= =20 to the Internet to use e-mail," said Tenzing Chief Executive Alan McGinnis.= =20 "E-mail is the killer app." Stymied by a huge air travel slump that has=20 drastically weakened many airlines since the Sept. 11, 2001, attacks,=20 Tenzing slashed payroll and dropped plans to include real-time Web surfing= =20 in its in-flight offering, now in trials at Cathay Pacific Airways and=20 Virgin Atlantic Airways. In an interview at Tenzing's offices, McGinnis=20 declined to say how much money Tenzing's board members and other investors= =20 contributed in December, but the company is hiring again, planning to boost= =20 its payroll by 25% from 65 now. Tenzing was launched in 1999 and has since raised more than $50 million,=20 including major investments from aircraft maker Airbus SAS and Cathay=20 Pacific's Taikoo Aviation Technologies. Aviation electronics maker Rockwell= =20 Collins last July invested $10 million in Tenzing and sent an executive,=20 Steve Piller, to act as Tenzing's chief operating officer. Tenzing's main=20 competitor, jetmaker Boeing's Connexion unit, offers a far more ambitious=20 and expensive, high-speed Web service. Tenzing claims it can often outfit=20 an airplane in a matter of hours with a single shoebox-sized computer=20 server that beams e-mail and short messaging service (SMS) to the ground=20 using the aircraft's existing antenna. Passengers can connect using their=20 own laptop or, as in the Virgin Atlantic trial, use seat-back video=20 screens. Tenzing has said from the start that Boeing's service will take=20 too long to install, deliver more than the customer really wants and cost=20 too much. Both companies say installation costs and revenue sharing with=20 airlines vary from deal to deal. "The airlines want to make sure what little money they spend is not=20 wasted," McGinnis said. "Our overhead is lower and we can charge less=20 money." In fact, Tenzing's estimated cost of $15 to $20 per flight to the=20 passenger for e-mail, and its current trial price of $2.50 to send an SMS,= =20 are well below Connexion's target of $25 to $35 per flight. To date,=20 Tenzing's service is available on 39 of Cathay's 69 jetliners and it plans= =20 to outfit the entire fleet by the end of the year. At Virgin, the service=20 is available on a half dozen aircraft with 13 more slated to follow by=20 mid-summer. Another "seven to 10" airlines have shown serious interest in=20 Tenzing, McGinnis said, though that list does not include two former=20 Tenzing trial customers =97 Scandinavian SAS and Air Canada. SAS last year= =20 signed with Connexion for a trial beginning in 2004, joining Deutsche=20 Lufthansa, British Airways and Japan Airlines in the Connexion fold. Air=20 Canada, which says it got positive feedback from the 500 passengers who=20 tried Tenzing in 2001, scrapped the service to keep its costs down and=20 focus on no-frills service. Connexion also suffered when airlines went into survival mode, losing a=20 deal with the top three U.S. airlines to invest in the venture and install= =20 the service on their aircraft and slashing staff. Unlike Connexion, which=20 claims business travelers as its primary market, Tenzing also sees its=20 e-mail offering selling well among leisure travelers. If all goes according= =20 to plan, Tenzing expects to post a profit in two years or less, even if it= =20 snares a tiny fraction of the hundreds of millions of airline passengers.=20 Ultimately Tenzing may offer instant messaging or wireless service, or even= =20 match Connexion's high-speed product. The future of the Internet is hard to= =20 predict, said McGinnis, a veteran of Microsoft's MSN network. "Ten years is= =20 an eternity in this business," he said. *************************************************** The owner of Roger's Trinbago Site/TnTisland.com Roj (Roger James) escape email mailto:ejames@escape.ca Trinbago site: www.tntisland.com Carib Brass Ctn site www.tntisland.com/caribbeanbrassconnection/ Steel Expressions www.mts.net/~ejames/se/ Site of the Week: http://www.trotters.net TnT Webdirectory: http://search.co.tt *********************************************************