Telecom Informer
by The Prophet
Hello, and greetings from the Central Office!
Spring has sprung in Beijing, which means that it's still very cold, but with an added bonus: giant dust storms that blow in from the Gobi Desert. Sometimes there is so much dust that you can't even see across the street. Winds blowing through the concrete canyons of the Haidian district, funneled by endless skyscrapers, can be enough to knock you over if they don't sandblast you first. There can be some beautiful days, but spring is my least favorite time of year here; I typically schedule a long business trip back to the U.S. And so I write to you from my home Central Office, back in the Great Northwest. It's comfortably cold, beautifully dusty, and my desk is exactly the way I left it on my last visit.
I spend a lot of time on airplanes, and this time mostly ends up being unproductive. Since 2005, it's been possible to use Wi-Fi onboard most domestic airlines in the U.S., and it's even possible to use GSM mobile phones on some European carriers. Meanwhile, in Asia, in-flight calling and Wi-Fi are surprisingly absent. Singapore Airlines and Cathay Pacific have announced plans to offer in-flight Wi-Fi, but it hasn't happened yet. Chinese airlines don't offer it either. And even Korean Air, the flag carrier of the most wired country on the planet, doesn't have even so much as in-flight calling It's baffling. I half expect Air Koryo (the flag carrier of North Korea) to make a "first in Asia" offering, simply out of spite.
There are few areas in telecommunications with such recent and rapid growth as in-flight communications. However, the deployment of such services is hardly new. In-flight calling began in 1983, with the first deployment of Airfone on American Airlines jets, and was officially launched in 1984. The handsets were large and clunky, and there was usually only one per aircraft. In 1987, Airfone launched seat-back telephones, which quickly became ubiquitous on U.S.-based airlines.
Airfone sprung from an experimental license granted in 1980 by the FCC to a fledgling company led by legendary telecommunications magnate (and founder of MCI) John D. Goeken. Quickly, an analog service was brought online. It offered scratchy, poor quality calls for $2 per minute, but became immensely popular with business travelers. The business grew quickly and was purchased in 1983 by GTE, which promptly violated most of the purchase terms, particularly concerning promised autonomy by Mr. Goeken to run the business.
After a court agreed to void his non-compete agreement with GTE, "Jack" (as he was known) convinced the FCC in 1990 to grant him spectrum to launch a competitive service. The new company, In-Flight Phone Corporation, offered a higher-quality digital calling experience. In-Flight Phone handsets also offered games and value-added services such as news and stock quotes. They even supported dial-up Internet service (at a slow bit-rate) and faxing. USAir eagerly adopted the upgraded service, even though pricing was the same as Airfone, and numerous smaller airlines followed.
GTE didn't stand still; in 1993, they upgraded the Airfone service to digital. However, the price increased: $2.49 per minute, plus a 29 cent per minute long distance charge, plus a $2.50 connection charge. Airfone pricing was so confusing and expensive that the service saw ever-declining use. In 1994, Airfone offered free incoming calls, but these were only supported by a cumbersome prepaid calling card platform (and calling to an Airfone in-flight, of course, wasn't free). By 1996, in an effort to boost demand, GTE was offering flat-rate unlimited duration outbound calling at $15 per call. Predictably, phreak conferences were suddenly on fire with Airfone calls, and the promotion ended soon afterward. In 1998, dial-up data speeds were upgraded to 9600 bps. Unfortunately, this was right around the time people were switching from dial-up to ADSL and cable broadband service.
And then, for a long period, not much changed except the usual mergers and acquisitions. In-Flight Phone Corporation was sold to MCI, which was in turn purchased by Verizon, which meanwhile had merged with GTE. Since Verizon already owned Airfone, the businesses were merged, again creating a monopoly in what had once been a competitive market. The FCC didn't seem to notice or care, but the previous duopoly hadn't resulted in much competitive pressure anyway. Rates stayed more or less the same. With the cost of jet fuel steadily increasing, corporate expense accounts constrained, and leisure travelers occupying more seats, airlines began to notice declining revenue (they received a share of Airfone billing). Weight contributes to fuel costs, and maintenance costs were high. The net result was fewer and fewer Airfone-equipped jets. By 2002, Airfone was back to offering flat-rate service, although data-only this time; $15.98 covered a package of email, SMS instant messaging, and information services (such as stock quotes). By then, it was too late.
The way that people communicate has changed dramatically in the past decade. Voice calling is now much less popular, particularly on airplanes. We still do substantial volumes of voice calls here in the Central Office, but average call duration is actually up (after steadily declining for a number of years).
When people want to communicate a short message, they use SMS; they call if they want to talk for a long time. Voicemail is also much less popular; I haven't needed to replace or upgrade our ancient AUDIX voicemail system (other than ever more intrusive CALEA software updates) in over a decade. SMS, instant messaging, Skype, and social media are the new ways to communicate - and usually some combination of these.
Recognizing the trend, tech-savvy Boeing developed a service called Connexion. Unfortunately, it was a complicated, heavy, and over-engineered system costing $500,000 per aircraft and was based on Ku-band satellite technology. While the service could support speeds up to 20 Mbps, latency is relatively high using this band (making sites like Facebook crawl). Lufthansa was the only enthusiastic adopter, equipping most of its long-haul fleet, but the service never became very popular and Boeing shut it off in 2006. Oddly enough, television didn't launch with the service (even though in-flight entertainment is a fairly obvious use for such a high-bandwidth system). Only four television channels, three of which were European, were finally made available in 2005.
Meanwhile, Aircell, a company that had spent nearly a decade trying (and failing) to picocell-based GSM voice calling, saw an opportunity. They rapidly constructed a network of over 100 leased and newly constructed towers, and obtained radio spectrum suitable for commercially available EV-DO Revision A broadband service (the same 3G broadband technology used by Verizon and Sprint).
They then installed more or less ordinary cellular panels and pointed them skyward, creating the first airborne cellular network - albeit with much larger cells than usual. Rather than an expensive, heavy satellite system, in-flight Wi-Fi could be delivered with a very simple system consisting of little more than an antenna on the bottom of the plane and a high-end wireless router inside the plane. The system was cheap and fast to install (it could be done in a few hours), and became an immediate hit with U.S. airlines, who were happy to have another revenue stream. The system is also popular with travelers, since it offers reasonably fast connections and low latency at a flat-rate price.
The biggest weaknesses are relatively low bandwidth, and coverage that is only available in the U.S., and can drop out over large bodies of water (such as the Gulf of Mexico). To address these limitations, Aircell is developing a Ka-based satellite system, using the same band as satellite Internet provider WildBlue. They also plan an upgrade to EV-DO Revision B this year for faster speeds.
There are other providers in the business as well. Row 44 provides a satellite-based service using HughesNet for backhaul. The equipment is lighter and takes less time to install than Connexion, and the service works well over water, providing nearly worldwide connectivity. The downside is latency, which is considerably higher than a ground-based system. Panasonic also competes with a similar system, and their network is compatible with old Boeing equipment (allowing airlines who have already installed it to retain the value of their investment). OnAir operates a satellite-based system utilizing Inmarsat's SwiftBroadband service. And Airfone? It's still around, but mostly for use in private aircraft. Verizon recently sold the service to LiveTV, a subsidiary of JetBlue. It's anyone's guess what they plan to do with it.
And with that, it's time for me to get back to annual maintenance here at the old Central Office. I'm only here for a few weeks, and then back to Beijing for more Asian adventures. Stay safe this spring, and if you see a dust storm heading toward you, get indoors!