[Infowarrior] - JetBlue buys Airfone network from Verizon

[Richard Forno]

JetBlue to Buy Verizon Unit In Email Push
By SUSAN CAREY
June 9, 2008; Page B1
http://online.wsj.com/article_email/SB121297681437256187-lMyQjAxMDI4MTAyOTkwNzk2Wj.html

JetBlue Airways Corp.'s LiveTV unit, a provider of in-flight  
entertainment to airlines, said it has agreed to buy Verizon  
Communications Inc.'s Airfone network, a move that should boost  
LiveTV's ability to offer email and messaging services on its clients'  
planes.

LiveTV LLC, Melbourne, Fla., said it will take over the Airfone  
operations -- including 100 air-to-ground communications towers in the  
continental U.S. -- and Airfone's corporate and government aviation  
clients on Jan. 1. LiveTV and Verizon declined to reveal the purchase  
price.

Currently, LiveTV's main service to JetBlue and a number of other  
carriers in the U.S., Canada and Australia is satellite-based  
television programming at seats, either free or for a small fee.

While use of cellphones is still forbidden on planes, airlines  
including JetBlue and other carriers in the U.S. and Europe are trying  
to respond to passengers' intense interest in email and broadband  
Internet services during flights. At the same time, they are  
struggling with questions of whether to charge customers and whether,  
in an era of high fuel costs, they can afford even the nominal expense  
of equipping their fleets with the antennas needed for the service.

AirCell LLC, a closely held provider of wireless data and voice  
communications based in Itasca, Ill., built its own network of air-to- 
ground communications towers. This year AMR Corp.'s American Airlines  
plans to test its air-to-ground system and Virgin America Inc. expects  
to broadly install it.

JetBlue last December began testing free in-flight email and instant- 
messaging services on one of its A320 planes. Passengers with Wi-Fi  
enabled laptops or two models of BlackBerry smart phones can access  
the service, which includes email though various Web-mail providers  
and shopping on Amazon.com Inc.

For the test, it is using Airfone's towers for a fee. The acquisition  
should help LiveTV expand its test service into a product it can offer  
to airlines, said Mike Moeller, a LiveTV vice president. JetBlue  
hasn't said when it might install the system on its own fleet but said  
it is happy with the test.

Continental Airlines Inc. in January entered into an agreement with  
LiveTV to equip its newest planes with in-flight television as well as  
Wi-Fi connectivity for email and instant messaging.

Airfone was a leader in in-flight communications for more than 20  
years, providing credit-card operated phones on planes. But that  
business slumped, and in 2006, the Federal Communications Commission  
auctioned off the spectrum Airfone was using, with LiveTV purchasing  
one MHz and AirCell the other three.

Write to Susan Carey at susan.carey at wsj.com