Gogo says its 2Ku system is the solution that will keep airlines at the forefront of technology for the longest length of time.
That was the message from Gogo President and CEO Michael Small who was speaking at the Morgan Stanley Technology, Media and Telecom Conference on Monday 29th February 2016.
By the end of 2015 Gogo says it had 202 aircraft flying on its global Ku satellite network and that by the end of the second quarter it will have finished its Ku-band installs on Delta’s international and JAL’s domestic fleets.
Small said Gogo can then concentrate on its 2Ku portfolio.
“Every time you get a change to a new technology there is a new level of certification that has to happen,” he said.
In October 2015, it received an STC from the Federal Aviation Administration to install its 2Ku satellite technology on Boeing 737-800 aircraft operated by Aeromexico.
As of December 31, 2015, it had 15 STC programmes under way and expects to install approximately 75 aircraft with 2Ku during 2016 and more than 300 aircraft with 2Ku in 2017.
Including the recent 2Ku aircraft awards for unannounced airlines, it now has more than 450 platforms awarded, but not yet installed aircraft, largely comprised of its 2Ku solution.
Aeromexico and Virgin Atlantic
Small added that Aeromexico’s test aircraft is flying with 2Ku and providing “great data”. It expects to get certification for 2Ku on Virgin Atlantic this quarter.
“We will have both of those airlines flying commercially with 2Ku by the middle of the year,” Small added. “Our field tests show that 2Ku exceeds our expectations. Even with 40 passengers streaming video everyone still gets a good browsing experience.”
Gogo’s announcement that it is developing a modem capable of up to 400Mbps was also good news for 2Ku customers.
“In the long run I’m confident that we will have a lower cost-per-bit than our Ka competitors. The dominant solution for inflight connectivity will remain satellite. Air-to-ground (ATG) solutions will continue to exist, but they will augment satellite systems.
“I think there is going to be a lot of decisions made now about what technologies airlines adopt and it is going to be very competitive. But as the bandwidth economics decrease, the passenger price point can drop and we’ll start to see the take-up rates improve dramatically,” he said.
Gogo record revenues
A few days earlier Gogo had released its fourth quarter and full year 2015 financial results. These showed a record quarterly revenue up 26 percent to $138 million and a record full-year 2015 revenue up 23 percent to $501 million.
“In 2015, we became a half billion dollar revenue business and installed nearly 1,900 broadband and wireless entertainment systems,” Small said.
“We also grew the number of awarded aircraft for 2Ku, our next-generation global satellite technology, to more than 800.
“Our industry leading technology, open architecture, operational excellence and products and services position Gogo extremely well in the growing global aviation in-flight connectivity industry.”
On the commercial aviation front, average monthly service revenue per aircraft online increased to $11,721, up 7% year-over-year, driven primarily by connectivity service price increases.
In Gogo’s business aviation business, service revenue increased to $28.5 million, up 41% from $20.3 million in Q4 2014, driven primarily by a 24% increase in air-to-ground(ATG) systems online to 3,477 at December 31, 2015 compared with 2,797 in 2014.