I would love to see a civil airlienr made with such an innovative and adventurous design, whichever side of the channel it comes from! Just a question of persuading one of the airliners to take it, and airports change their designs etc. I could see this being a BWB with a normalish nose just to it would be compatible with finger jetty's and the like.

Customers are always nervous about diving into new technologies and radical new designs unless there's a big advatage. Just look at the Sonic Cruiser. It was radical new design, but the advantages (a marginal increase in speed) were outweighed by the disadvantages (more fuel consumption), so the customers didn't bite. Like you, I'd like to see this monster new concept 797 fly, just for the sake of stretching the technology of the industry, if nothing else. I mean, if you look at the most recent major innovations since the jet-age began: 1) Fly-by-wire controls--allows the computer to make adjustments to the flight. This is a safety/comfort improvement, because the computer can adjust to atmospheric conditions more quickly than humans could, making the flight more stable. It can also alert the pilot when certain manuvers are dangerous. 2) "Glass" pit--computerizes the dispays, making them less confusing for the pilot. Again a safety improvement. Crashes caused by human error are often result of the pilot being confused/disoriented. 3) Ceramic airframes--This is the most recent improvement and has resulted in aircraft being lighter and more fuel efficent, and presumably more durable (although that part remains to be seen in practice). This is the first big improvement that addresses economics. It's the main reason the 787 is such a big improvement over previous designs. So now we have the "flying wing", an efficient, but inherently unstable design which is made possible only by the fly-by-wire control. The airline industry can look to the B-2 bomber for reassurance that the idea is practical, efficient and safe. The next big hurdle will be development cost. If the development cost for the A380 (a big, but relatively conventional design) is $10-12b, you can imagine what this proposed 797 will cost. Will Boeing want to front that much money on such an unconvential design?

(so Airbus customers will be paying for modifications that Boeing customers will end up using). - PPR I wasnt aware of that, are costs to modify airport infrastructure being passed back to Airbus and hence on to the airlines purchasing the aircraft and ultimately those flying in it?

Boeing and its subsidiary companies have got lots of experience in BWB designs, avionics etc. gleaned from government military development contracts. Cue lots of transatlantic snarling over government subsidies.

ArtyEngineer, if I recall correctly, the airlines flying the A380's are paying for some very expensive modifications (such as reinforcing the runways and modifying the terminals so they can handle the larger, heavier plane). But once those runways are upgraded, anyone can use them.

A flying wing shape isn't inheritaly unstable. Germans tested one in WWII. I'm pretty sure it wasn't unstable or FBW. Google for Horten Ho IX or Go 229

Although its investment in the 787 will probably keep the 797 from being built any day soon - the possible shutting down of the C-17 production line might encourage the military to help. However, the 797 would be more of a C-5 replacement than a C-17 replacement so even this seems dubious. Personally, though I hope I'm wrong, I believe the 797 will only happen if Lockheed and Boeing merge...

One nice thing about tubular aircraft is that stretch versions can come out later and continue the revenue stream.  It would seem that the 797 will not be easily stretched.

Considering the success of the 787 and Airbus's panicky attempts to match it, the 797 will probably sit on the shelf for a while unless it can prove real savings on fuel, and then it may start off as a cargo jet.

I have been poking around the net, and I haven't been able to find any info on this from really reliable pages.  I did find this page, however that claims the wole entire rumor is false. 

http://www.truthorfiction.com/rumors/b/b797.htm

They claim that they heard the rumor and went straight to boing, who denied it.