What’s The New Deal Between JetBlue Airways Corporation (NASDAQ:JBLU) And Amazon.com, Inc. (NASDAQ:AMZN)?

JetBlue Airways Corporation (NASDAQ:JBLU) and Amazon.com, Inc. (NASDAQ:AMZN) have agreed to stream music, movies and television from the internet retailer on flight. It enables the airlines company to broaden its entertainment options for travelers.

The services

As per the report, the service would be available on most of the company’s aircraft this year using the free Wi-Fi. The passengers can avail the service on their mobile devices and laptops. They will have flexibility to buy or rent titles from Amazon. The prime members of online retailers, who pay $99 per year in the U.S., will be allowed to stream content at no additional cost. The two companies didn’t reveal the commercial terms of the new deal.

The view

Henry Harteveldt, a founder of Atmosphere Research Group, said that it is the most unique offering of entertainment content offered by an online retailer to any airline anywhere in entire world. Most competitors of JetBlue don’t even have fast-speed Wi-Fi to support video streaming. They have no option but to depend on fixed media libraries. JetBlue and Amazon appears to be entering into a close association, and online retailer might pay airline company to help keep its Wi-Fi free. It is a win-win condition for both the companies.

The expert speaks

Michael Paull of Amazon said that the management is excited that with JetBlue they raised the standard in airline entertainment industry. The airline company maintains DIRECTV (NASDAQ:DTV) service on video screens at seat-back. With the new deal, JetBlue becomes the first airline company in the world to get online video streaming into its online portfolio. The number of passengers on JetBlue using Fly-Fi or Wi-Fi is relatively low on short flights and increases to 45% on flights of longer duration. On some flights, the management reported more than 100% uptake. The services will start later this year.

About the Author

Erica is a graduate of New York University's school of Journalism. She joined US Markets Daily as a general assignment reporter in January of 2008.

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