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Tue, Aug 22, 2006

Korean Air Wants Compensation For Connexion Costs

Modifications For Soon-To-Be-Defunct Service Cost $12 Million

This could be just the beginning of the fallout over Boeing's announcement last week it was discontinuing its six-year-old Connexion by Boeing in-flight wireless internet service, as an official with Korean Air says the airline plans on going after the American planemaker for the cost of making its fleet compatible with the service.

"We are planning to make such a request," the official told The Korea Times this week.

To date, Connexion is flying in about 29 Korean Air planes -- accounting for a full 16 percent of all global aircraft offering the service. Each aircraft carrying Connexion required $400,000 in equipment and modification costs, according to Korean Air.

What's more, that $12 million estimate may prove to be optimistic, as many expect the pricetag to rise even higher. In addition to the planes already flying, Korean Air had plans to install Connexion on an additional 25 airplanes by 2008, in its role as the first Asian carrier to be certified by Boeing to put the service on its planes.

Another Korean carrier, Asiana Airlines, is expected to fare better in the loss of Connexion service -- as the Number 2 carrier has, to date, only installed the wireless internet service in two 777-200s.

"We will begin removing antennas for Connexion after the service [expires at the end of the year], as they are no longer useful," said one Asiana Airlines spokesman -- who then added insult to injury, by adding the Connexion equipment added more weight than originally forecast.

Asiana Airlines also plans to join with its partners in Star Alliance to ask Boeing for compensation, the spokesman said -- which likely means these two carriers won't be the last of the 11 airlines who signed on for the service -- which never posted a profit for Boeing -- to approach the planemaker for reimbursement.

FMI: www.connexionbyboeing.com

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