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CEO aims to replace the little black boxes on planes

It took 14 days to detect a signal from black boxes on Egypt Air Flight 864, and the cause of the crash is still unknown. Tom Schmutz, CEO of Flyht, says his company's streaming technology could prevent such confusion after accidents by replacing planes' traditional black boxes.

"People will do the cost-benefit analysis and realize that there's better ways to do things than the way we've done things in the past," Schmutz told CNBC's "Power Lunch" on Friday. "If we had had the information from the aircraft in real time, then we could have been working and understanding the solution far in advance."

His company's technology uses real-time data to transmit to the ground the same information collected in black boxes. He said the ability to transmit information directly would avoid situations like Air France Flight 447, which crashed in 2009. It took two years to recover the black boxes from the wreckage.

That data may not have been able to prevent a crash in the moment, but it could have prevented subsequent accidents, Schmutz said.

"What the data showed was an aircraft fault, and there was a procedural problem," Schmutz said, referring to the Air France wreckage.

Flyht sells equipment directly to airlines for about $100,000 per aircraft, which Schmutz said airlines make back in operational efficiency. Flyht has sold streaming equipment to 50 companies but is still waiting for that "first big customer in Europe or North America."


Gordon Bethune, former Continental Airlines chairman and CEO, said U.S. airline regulators might mandate the technology if it proved to have a material change in aircraft safety. But it might not be vital to get black-box data right away.


Airplane with Computers, Wifi idea
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"The information is important but it's not that critical to have in live time," Bethune told CNBC Friday. "The regulators tend to go on the safety side, and, of course, bereaved families want to know."

The problem with all airlines adopting the technology is a cost-benefit analysis, Bethune said. The real-time data is helpful after the fact but might not save lives in an immediate crisis.

"Very little can be done to help an airplane recover from some catastrophic event by talking to the ground," Bethune said. "It really just hasn't cleared the threshold for a very significant capital investment and operating costs."