hankyoreh

In-flight Internet service, which drew huge public attention when it was launched a year ago, has failed to meet customers’ demands, causing losses for airline companies and Internet operators.

According to Red Herring, a U.S. information technology magazine, a total of 12 airline companies that invested a combined US$1 billion in installing in-flight Internet systems, officially announced the suspension of the service. The suspension was mainly attributable to high charges, which led to lower-than-expected customer demand, sources said.

The decision came as Boeing Co. withdrew its plan to pursue the Internet service, causing significant losses for local airline companies such as Korean Air and Asiana Airlines.

Korean Air, the nation’s top airline, installed Internet systems in 29 of its airplanes, which it said cost around 400 million won (US$412,000) per craft. The company will have to allot additional spending to remove the systems following Boeing’s decision to cancel the service.

"We have not received an official answer from Boeing, but we think that we have to provide the service until the end of this year," an official of Korean Air said.

Hanarotelecom, a smaller national Internet operator, faces the loss of its contract with Boeing, signed last November, to provide wireless Internet service for three years. KT, the nation’s largest fixed-line and broadband operator, is also facing losses due to the discontinuation of the service.

The service came to a halt as the demand for in-flight Internet service was not as high as had been expected. An average of 10 passengers used the service in a 300- to 400-seat airplane. The fee for the service, around 20,000 to 30,000 won per connection, also seem to have played a part in discouraging customers from using the wireless Internet system, sources said.