Apple, Airlines Team to Incorporate iPods Into In-Flight Entertainment

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Airline passengers will soon be able to connect their iPods to in-flight entertainment systems and watch their favorite videos without fear of running out of battery power while traveling on any of six major carriers, iPod maker Apple Computer Inc. (AAPL) said Tuesday.

Air France, Continental Airlines (CAL), Delta Air Lines Emirates KLM and UAL Corp.'s (UAUA)United Airlines will begin offering their passengers iPodseat connections, which power and charge iPods during flight and allow the video content on the devices to be viewed on seat-back displays.

The service will begin in the middle of next year. Other terms of deals were not disclosed.

All airlines are "looking to upgrade their entertainment systems, especially for longer distance flights," said Ray Neidl, senior airline analyst at Calyon Securities. "This is just one way of doing it."

While many travelers now use laptop computers or portable DVDs players to watch videos, those devices have limited battery life.

Apple has sought to expand the possible uses for its market-dominating iPod, including deals to build iPod ports into new-model cars. The announcement came as rival Microsoft Corp. launched its Zune digital music player Tuesday in a bid to challenge the iPod.

To date, Apple has sold nearly 70 million iPods and more than 1.5 billion songs through its iTunes music store. It has also made popular TV shows and movies available for purchase and download through its Internet store.

But with more than 75 percent of the U.S. market for digital music players, analysts have voiced concern that there is limited room for growth in iPod's market share.

Apple has responded by introducing new versions of the device, including a new video iPod and iPod Shuffle. By striking deals to have iPod outlets in cars and now airlines, the computer maker is also expanding the uses of its hugely popular music and video system.

At the same time, airlines are searching for ways to keep customers loyal, even as many cut back on services such as meals to control costs. Apple is working on bringing the iPod service to other airlines, it said.

In a statement, United said that the deal is part of its broader plan to upgrade international first- and business-class travel.

"There is significant value in offering a superior in-flight entertainment experience to our first- and business-class customers during their international flights," said Graham Atkinson, executive vice president and chief customer officer.

Calyon's Neidl said he believed Apple and other airlines would soon announce similar deals. "It's a nice add-on, makes customers happier, keeps them out of flight attendants' hair," he said.

Apple shares fell 20 cents to $84.15 in early trade on the Nasdaq. The Amex airline index was down 1.7 percent.