Shutdown of Connexion-by-Boeing service highlights pitfalls of
in-flight passenger communications businesses
MENLO PARK, Calif., Aug. 17 /PRNewswire/ -- Telecom, Media and
Finance Associates, Inc. (TMF Associates), the specialist Mobile Satellite
Services consulting firm, today forecast that the market opportunity for
in-flight communications will be much smaller than many analysts and
consultants have been projecting.
TMF Associates forecast in a research note published in June 2006 that the
Connexion service would ultimately be shut down and that backers of other
systems would need to re-evaluate whether their business projections are
simply too optimistic. However, other consulting firms have continued to
project that a multi-billion dollar market will be realized for in-flight
passenger communications over the next five years.
Tim Farrar, author of the note, commented "It is all too easy to blame the
failure of Connexion-by-Boeing on its high costs and large terminal
equipment. However, set in the context of the expenditure by business
travelers on other communications services, projections that in-flight
communications can become a multi-billion dollar market over the next few
years are completely unrealistic. For example in July 2006 Booz Allen
forecast a EUR 2 billion market for in-flight cellphone use in Europe alone
by 2010. This compares to a total pan-European cellular roaming market
of EUR 8 billion in 2005, when by our estimate business travelers are on
an airplane for at most 3% of their trip. While the in-flight communications
market opportunity within the US remains significant, and may grow to
around $300M in annual revenues over the next ten years, the opportunity
on both long-haul and intra-European flights is far smaller. Inmarsat-based
services will provide an appropriate solution for cellphone-based
connectivity, but given the modest size of the overall market it is hard to
see affordable in-flight Internet services for laptop users being widely
deployed outside North America."
To download copies of the briefing note please visit
Both the briefing note and the market projections for in-flight
communications form part of TMF Associates' newly launched
information service on the Mobile Satellite Services (MSS) sector.
More details are available at http://www.tmfassociates.com/reports.
TMF Associates, headquartered in Menlo Park, California, is a leading
consulting and research firm providing business and technical analysis in
satellite, wireless and broadband telecommunications. The firm specializes
in Mobile Satellite Services (MSS), including Ancillary Terrestrial
Component (ATC) technology, and works with operators, investors and
equipment manufacturers to analyze complex market issues. For
additional information, please visit http://www.tmfassociates.com.
CONTACT: Tim Farrar, President
Telecom, Media and Finance Associates, Inc.
650-839-0376 or firstname.lastname@example.org