Taxis in the Sky

How tiny jets, Soviet-trained math prodigies, American “ant farmers,” and dot-com refugees are revolutionizing air travel
CEO ED IOCOBUCCI shows off some of the formulas DayJet's "ant farmers" have devised to keep planes and people moving.

Ed Iacobucci, now in his early 50s, grew up outside Atlanta and studied computer science at Georgia Tech. He rose quickly within IBM and by the late 1980s was directing a joint Microsoft-IBM project to develop a new computer operating system called OS/2. It was technically elegant, but tensions between the two companies broke up the project and doomed the product. IBM soldiered on with its own, unpopular version of OS/2 for another decade (Microsoft applied its part of the work to Windows 95 and Windows NT), but Iacobucci quit in 1988 to start a new company, Citrix, that would work on similar software. Over the next decade, Citrix enjoyed its own hypergrowth, with Iacobucci as chairman. Several executives now at DayJet, and the Russian mathematicians, worked with him there. As he prospered, Iacobucci bought a Learjet for business travel. Then, in the tech collapse of 2000, Citrix’s share price fell by 50 percent in a week. Iacobucci stepped down as chairman.

During the good times, his wife, Nancy, had started an air-charter business called Wingedfoot. It was a “traditional” charter business—that is, multimillion-dollar aircraft hired for very high fees by corporations or tycoons. By that time, Iacobucci was following the same aviation-world chatter I was, about the coming of small jets. The difference between a writer and an entrepreneur is this: the only thing I could figure out to do was write a book about it; by January 2002, Iacobucci and his wife had raised several million dollars from friends, family, and tech-industry investors to start work on a new air-taxi company. (They raised some $16 million from investors, in two rounds, from 2001 through 2006; then another $50 million in early 2007; then $140 million in debt financing, to buy airplanes, about a year ago.) They code-named the company Jetson Systems, which they wisely changed to DayJet when they announced their plans in 2003.

Here are some of the essential reasons that the new business was not as outlandish as the original name might have made it seem.

First, the airplanes. Eclipse, founded by another software-industry veteran who had worked with Iacobucci named Vern Raburn, promised to deliver fast, small jets for about $1 million apiece—versus five to 10 times that much for Gulfstreams, Falcons, Learjets, etc.—and to build them with advanced, Toyota-style lean-manufacturing techniques that would make them dramatically more reliable than current versions. Their efficient engines would also make them cheaper to operate, bringing the overall cost per mile of jet travel to a small fraction of the private-jet level. The price of an Eclipse has risen to about $1.5 million, but it is still much cheaper than alternative jets.

Next, the airports. Although unnoticed by most travelers, the United States is studded with airports, at least 3,500 of which have runways large enough to allow small, Eclipse-style jets to take off and land. The real value of these airports is that most of them stand nearly empty and could handle many more airplanes carrying people to and from the suburbs, office developments, factories, or recreation sites nearby. Most were built during an aviation boom that ended 50 years ago, and have barely been modernized since then. Bruce Holmes’s efforts at NASA included exploring ways to make them all usable, even in bad weather—especially with safer, modern GPS-based landing systems.

And finally, the airlines. Despite the temporary dip in air travel after 9/11, compared with 2000, airlines now serve fewer cities, with less-frequent flights and often with smaller airplanes—but carry more people overall. And although a larger share of flights go through overcrowded hubs such as O’Hare, Dallas/Fort Worth, and Atlanta, those airports rarely add new runways. This has the same effect as trying to force more cars onto a given road: all of them slow down. Once in the sky, jets are as fast as ever, but cascading delays mean that the overall door-to-door speed of U.S. airline travel has been slowing down.

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James Fallows is an Atlantic national correspondent; his blog is at More

James Fallows is based in Washington as a national correspondent for The Atlantic. He has worked for the magazine for nearly 30 years and in that time has also lived in Seattle, Berkeley, Austin, Tokyo, Kuala Lumpur, Shanghai, and Beijing. He was raised in Redlands, California, received his undergraduate degree in American history and literature from Harvard, and received a graduate degree in economics from Oxford as a Rhodes scholar. In addition to working for The Atlantic, he has spent two years as chief White House speechwriter for Jimmy Carter, two years as the editor of US News & World Report, and six months as a program designer at Microsoft. He is an instrument-rated private pilot. He is also now the chair in U.S. media at the U.S. Studies Centre at the University of Sydney, in Australia.

Fallows has been a finalist for the National Magazine Award five times and has won once; he has also won the American Book Award for nonfiction and a N.Y. Emmy award for the documentary series Doing Business in China. He was the founding chairman of the New America Foundation. His recent books Blind Into Baghdad (2006) and Postcards From Tomorrow Square (2009) are based on his writings for The Atlantic. His latest book is China Airborne. He is married to Deborah Fallows, author of the recent book Dreaming in Chinese. They have two married sons.

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