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Gogo says inflight connectivity could be worth £1m per aircraft

Gogo President and CEO Michael Small.

Gogo President and CEO Michael Small.

Gogo President and CEO Michael Small thinks that the inflight connectivity market could ultimately be worth around £1m per aircraft per year.

That was the message he delivered during a presentation at a recent UBS Investment Bank conference.

Small said that Gogo currently generates around £115,000 per aircraft per year, but this is mostly due to passenger connectivity. Factor in predicted growth due to aircraft e-Enablement, which could see hundreds of sensors delivering data to the ground, and the market grows enormously, he said.

He added: “Gogo is currently taking around a two-thirds share of the North American inflight connectivity market. The rest of the world and business aviation is largely unspoken for.

“But the entire aviation market is a trillion dollar market opportunity. The opportunity for savings and opportunities in this industry is significant.”

He added that Gogo is currently connecting around 20% of the world’s aircraft, far more than all of its competitors combined.

“With business aircraft we are taking around 100% of all the new broadband connectivity connections globally,” he said. “We win because we specialise in aviation.

“We are confident that our solutions are far superior to our competitors’.”

Small added that Gogo made its name with air-to-ground connectivity in the US, but it sees future success with its 2Ku Ku-band satellite connectivity solution.

Since Gogo entered the international market in 2012 it has won contracts for 300 aircraft. Small said that it has won 52% of all contracts for new connectivity on aircraft this year alone, more than all its competitors combined.

He added that its upgraded air-to-ground ATG4 solution has been well-received by the airlines, but the faster speeds available via 2Ku, which should see certification in 2015/2016 and entry into service in 2017, will be a game changer for the company.

He said that the equipment for 2Ku will be more expensive than that used for ATG, largely due to the satellite antenna, but added that it offers a lot of benefits over ViaSat’s Ka-band solution.

“Getting more bandwidth to aircraft is transformative,” said Small. “And getting into the connected aircraft market will be equally transformative.”

And what about the technology roadmap for the future?

“We have a path to 100Mbps using 2Ku and satellites. We are actively looking at ways to get similar speeds using an air-to-ground solution,” said Small. “A sole ATG solution is no longer competitive. Even with the US-based fleet, it flies to the Caribbean, it flies to Hawaii – you need to have a satellite-based solution.

“Because our 2Ku antenna is twice as spectrally efficient as our competitors’ we can cut our bandwidth costs in half. This makes it economically attractive for us.”

He added that Gogo currently doesn’t have its Ku-band equipment certified as line-fit on the Boeing 787 and Airbus A350, but is working with both companies to rectify that hurdle.

“Originally we were labelled as an ATG provider, but all our research shows that airlines now rank Gogo up there alongside the rest of the satellite-based inflight connectivity providers,” Small concluded.

Gogo says inflight connectivity could be worth £1m per aircraft was last modified: February 16th, 2017 by Steve Nichols
Filed in: Commercial Tags: , , , ,

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