Continental to offer live TV, email on domestic flights

By Chris Reiter

NEW YORK, Jan 29 (Reuters) - Continental Airlines Inc (CAL.N: Quote, Profile, Research, Stock Buzz) said on Tuesday it will offer live television and e-mail service on domestic U.S. flights, starting in 2009.

With the economy slowing, U.S. carriers have stepped up efforts to offer better in-flight services in order to attract higher-paying passengers and boost revenue. Southwest Airlines Co (LUV.N: Quote, Profile, Research, Stock Buzz) last week said it plans to start testing satellite-based Internet service this summer.

Continental, the No. 4 U.S. carrier, is partnering with LiveTV LLC, a unit of JetBlue Airways Corp (JBLU.O: Quote, Profile, Research, Stock Buzz), and will offer 36 channels of DIRECTV (DTV.O: Quote, Profile, Research, Stock Buzz) satellite-based television as well as WiFi service that allows passengers to access e-mail and instant messaging.

LiveTV will begin installing the equipment on 225 Continental planes, which represent the majority of the carrier's domestic fleet in January 2009. The installation process will take about 18 months, Continental spokeswoman Julie King said.

The service will cost Continental next to nothing to start, but it will also get little in return.

"We're providing most of the capital and we're retaining most of the revenue," Nate Quigley, chief executive of LiveTV, told Reuters.

The television service will be complimentary in the first-class cabin, and cost $6 for economy-class passengers. (Reporting by Chris Reiter; Editing by Gunna Dickson)