Boeing taps Mitsubishi Elec. for aircraft antennas

TOKYO: US aerospace giant Boeing Co. said on Friday it had selected Japan's

Mitsubishi Electric Corp. to supply antenna systems for an in-flight Internet

service it aims to roll out in 2004.

Boeing said the antenna systems would account for about a quarter of the cost

of the project, expected to reach hundreds of millions of dollars. The

Seattle-based company's "Connexion by Boeing" service will offer

passengers high-speed in-flight Internet connections to send e-mails and watch

online news broadcasts.

Two European airlines, British Airways and Deutsche Lufthansa AG, will offer

the service on a trial basis for three months early next year using an antenna

system developed by Boeing. Boeing said the Mitsubishi system, which it aims to

deploy early in 2004, would offer substantially greater efficiency.

"Mitsubishi Electric met all the key parameters," Scott Carson,

president of Connexion by Boeing, told a news conference. The company shifted

the initial focus of its airborne Web service to international routes after the

September 11 attacks, which spurred a sharp drop in domestic US air travel and

left US airlines too financially strapped to afford it.

Boeing ultimately hopes to install Connexion on 4,000 jets -- about a third

of the world's commercial fleet -- over the next 10 years, bringing in $3

billion to $5 billion in annual revenues. The system will be offered to carriers

for use on both new and existing aircraft, as well as for jets made by rivals

such as Europe's Airbus.

The latest deal builds on an alliance unveiled in April 2000 that positioned

Mitsubishi Electric as a strategic partner for Boeing in Asia. Mitsubishi

Electric was hit hard by last year's IT slump, although its losses were modest

compared with Japan's other chip and electronics conglomerates, thanks in part

to solid profitability in its industrial systems business.

Mitsubishi Electric's shares ended Friday trade 2.21 per cent lower at 531

yen, in line with a 2.44 per cent drop in the benchmark Nikkei average.

Reuters Limited.