YOU ARE AT:Archived ArticlesIN-FLIGHT PHONE QUIETLY FILES FOR BANKRUPTCY IN DELAWARE COURT

IN-FLIGHT PHONE QUIETLY FILES FOR BANKRUPTCY IN DELAWARE COURT

Oakbrook Terrace, Ill.-based In-Flight Phone Corp., the competitor to GTE Airfone Inc. for consumer air-to-ground communications, entertainment and information, quietly filed for Chapter 11 reorganization in a Delaware court.

In-Flight officials would not comment on the Jan. 24 filing, choosing only to issue a written release and a telephone recording. “In-Flight has also entered into an interim service agreement with MCI Telecommunications Corp. under which In-Flight will receive sufficient funds from MCI to continue its normal operations for 45 days,” the release read in part. “In-Flight anticipates that post-interim funding will be available and is in discussions to conclude the necessary arrangements for the post-interim period.”

MCI, the company’s majority stockholder, is remaining closed-mouthed about the reorganization; a terse press release acknowledged the bankruptcy filing and said MCI would not be contributing any more debt or equity to the venture.

“Like many others, we were a little surprised,” said Laura Littel, public affairs manager for GTE Airfone. Littel also said that while her company partners with giant entertainment providers like Sony Corp., Hughes Corp. and Matsushita to provide customers with services other than straight telephony, In-Flight took the risky step of “marrying the two and trying to be the expert in both areas. It was a very aggressive, challenging strategy” that could have drained the company’s coffers.

“This is a reorganization and not a liquidation, so they are willing to keep trying,” Littel noted, adding that no talk of a possible GTE buyout was making the rounds.

In-Flight originally was the brainchild of Jack Goeken, who developed the GTE Airfone concept; the Goeken Group sold its technology to MCI several years ago.

According to a company press release, In-Flight is readying a new offering, LiveTV, which would provide a minimum of 12 and a maximum of 24 channels of live television programming to every seat-back In-Flight screen.

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