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FAA Eases Smartphone and Tablet Regulations

Passengers have more time for in-flight Wi-Fi purchases


Good news, Apple (AAPL) addicts. Soon, you’ll be able to play Candy Crush the entire time you’re on a plane.

Today the New York Times reported that the Federal Aviation Administration is nearing a decision on new rules for portable electronic devices. It’s expected that the new guidelines will allow devices to be on at all times.

Apps that don’t require a network connection — like e-books, podcasts and non-streaming video — are cleared for takeoff (and landing), but you’ll still probably have to keep your smartphone or tablet on “airplane mode.” To clear a device, airlines must prove that outbound signals will not interfere with the particular plane they will be used on, and there are simply too many different kinds of devices to check each one’s safety.

Allowing airline customers to use their Wi-Fi enabled devices for longer isn’t just an act of goodwill toward app-addicted passengers. It could be a big moneymaker for airlines, too — in 2012, 80% of Southwest’s (LUV) passenger revenue came from in-flight Wi-Fi purchases.

It only makes sense — travelers are a captive audience, and with the new FAA rules, they’ll only become less likely to unplug than they already are. This could be a boon for stocks like Gogo (GOGO), which is the biggest in-flight internet provider with about 81% market share in the $3 billion-a-year industry.

The FAA will meet this week to make a final decision on the new regulations, which won’t take effect until next year.

As of this writing, Carla Lake did not hold a position in any of the aforementioned securities.

Article printed from InvestorPlace Media,

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