How Apple Pay Works in JetBlue's Skies

— -- Up in the sky, look: It's a bird. It's a plane. It's Apple Pay.

Apple Pay and JetBlue's new Inflight Service Assistant unveiled today may be just the heroes JetBlue needs when it comes to differentiating itself from legacy carriers that pile fees on passengers.

JetBlue announced that it's the first major domestic carrier to offer Apple Pay in the sky, allowing passengers to make quick on-board purchases for food or amenities.

Last November, JetBlue announced that it was eliminating free checked bags on some flights, surprising customers who were swayed by JetBlue's longstanding free policy. Southwest is now the only domestic airline to let all fliers check at least one bag free of charge.

JetBlue flights have been cashless since 2007, but the company hopes Apple Pay and other in-flight experiences will woo customers.

Here's how it works: Customers with an iPhone 6, iPhone 6 Plus and soon Apple Watch simply hold their phone in front of a crew member. Apple Pay uses NFC technology and works without a Wi-Fi connection. A JetBlue flight attendant will then use a mobile card reader to complete the transaction.

JetBlue's free Fly-Fi broadband Internet that uses satellite technology is available on most JetBlue planes and the company says it's working to expand the service to the rest of its fleet. Basic Web browsing through Simply Surf is free while JetBlue's service is in beta testing, but a high-bandwidth plan, for uses such as movie streaming, is available for purchase.

Along with JetBlue's use of Apple Pay, the airline announced a new app used by flight attendants called the Inflight Service Assistant. More than 3,500 crew members will each carry an iPad mini with access to the customer manifest and updated flight data, pushed wirelessly. The company touts it as a way to provide a "more personalized onboard experience," including wishing a customer a happy birthday and offering flight and connecting gate information. JetBlue says it is awaiting Federal Aviation Administration approval so in-flight crew members will no longer have to carry a bulky flight attendant manual.

Neal Dihora, an analyst with Morningstar who doesn't cover JetBlue, said the airline's move to improve convenience for customers has been a winning business strategy that supplements selling plane tickets.

"Airlines have been using information technology to show premium seats and packages and that has helped ancillary sales," Dihora said. "I see this as a similar advancement or convenience."