Boeing's Connexion May Be On The Block

Boeing's ambitious in-flight Internet Connexion venture may be fizzling, according to a report in Thursday's Wall Street Journal stating that Boeing is considering shutting down or selling the unit.

The newspaper said Boeing has been shopping the unprofitable service around and there appear to be no takers yet. Connexion has been installed by several airlines, which have been using it on international flights. However, in the U.S., the service hasn't been approved by the FCC for domestic flights.

Calls placed to Connexion offices in the U.K., and Seattle were not immediately returned.

The Boeing service uses costly satellite links -- the Wall Street Journal said people in the know estimate that about $1 billion has been spent on the service so far. Connexion provides Web access and has generally been well-received by passengers who have used it.

But, since Connexion got underway about six years ago, cheaper technologies have emerged. In recent weeks, for instance, JetBlue Airways received valuable wireless licenses for $7 million in an FCC auction that could be used for passenger communications. JetBlue hasn't said exactly what it plans to do with the licenses.At the same time, other in-flight technologies have been emerging. European aircraft manufacturer Airbus launched OnAir, a mobile phone-based service in 2005 and this week OnAir announced that it has partnered with Monico Telecom to build out the service's ground infrastructure.

OnAir said Thursday that it will launch GSM and GPRS mobile phone services on some European flights next year. The service will give passengers access to phone calling, text messaging, and e-mail.

Earlier, Boeing's new chairman, president and chief executive Jim McNerney moved the Connexion unit into Boeing's mergers and acquisitions operation, setting up Connexion for a possible sale or spin off.

The Wall Street Journal said Boeing has talked about selling Connexion with various communications firms including SES Global SA, Inmarsat PLC, and Loral Space & Communications.