Decision reflects important trend in the nascent market

The race to bring the Internet to airline passengers is heating up, with Virgin Atlantic Airways Ltd. announcing Monday that it will be the first carrier to offer e-mail and Web access at every seat on all of its aircraft. VIRGIN ATLANTIC PLANS to quickly deploy a limited e-mail and Internet-access system in conjunction with Tenzing Communications Inc., a small, closely-held Seattle company that has become a pioneer in launching such networks on aircraft. The decision reflects an important trend in this nascent but potentially huge consumer market, which by some estimates could mushroom to tens of billions of dollars annually by the end of the decade. A growing number of carriers such as Virgin, Cathay Pacific Airways, Singapore Airlines and others — all considered innovators in high-tech cabin amenities — are eager to launch Internet-at-the-seat services relying on current satellite antennas and existing onboard telephones or in-flight entertainment equipment. Cathay Pacific has committed to installing Tenzing’s systems for first class and business class. Airbus Industrie, after standing on the sidelines for the past year watching rival Boeing Co.’s struggles to launch its more- powerful and extensive Internet service, dubbed Connexion, has opted to jump into the fray by offering airlines a simpler alternative. Airbus, a unit of European Aeronautic Defense & Space Co., is expected to choose Tenzing as one of its primary project integrators, and an announcement could come as soon as in the next few weeks, industry officials said. Last week, Airbus disclosed it planned to shortly select industrial partners, and by 2002 could begin installing computers and other equipment necessary for Internet links on the assembly line.