Gogo would be 'happy' to talk with AT&T about leasing spectrum, CEO says

While Gogo President and CEO Michael Small says he doesn't understand why AT&T Mobility (NYSE: T) wanted to get into the in-flight wireless business in the first place, he's not dismissing the idea that Gogo might one day lease spectrum from the telco.

Small, who heads the largest U.S. provider of in-flight Wi-Fi, was asked at the Wells Fargo Securities conference in New York to comment on AT&T's decision to scuttle its plans to build a nationwide wireless network for airplane passengers. He could "never understand the strategic rationale for AT&T getting in, and I couldn't understand how they could possibly implement it even if they had some reason to do it," he said.

Small said that anyone contemplating getting into Gogo's space would have to "really know telecom," not just as a service provider but as an equipment manufacturer. "You need to know the unique requirements of aviation and you have to do this on a global basis to hopefully be successful."

"The barriers to entry in this business are extraordinary. You need extensive telecommunications knowledge because nothing off the shelf works," he said, noting that anyone getting into the business also needs to design and write software and build pieces of equipment that "no terrestrial operator ever does, so that's a real challenge."

AT&T surprised some when it announced in April that it was getting into the in-flight Wi-Fi business. It said it was going to partner with aerospace company Honeywell to install the required hardware onto airplanes to support the service. Later, in an FCC filing, the company revealed it would likely use its WCS C and D Block spectrum to provide in-flight Wi-Fi services because pointing the antennas up at the sky would reduce the possibility that a standard, ground-targeted wireless network would interfere with operations in adjacent bands, including Sirius XM radio.

Asked if Gogo would be interested in leasing AT&T's spectrum, Small said: "Right now our focus is getting 2Ku out there because it's a global solution... We think 2Ku will reach 100 megabits per second, the next major milestone." Inevitably, however, Gogo will also need more spectrum, and "if AT&T is interested in leasing its spectrum, we'd be happy to talk to them."

In the company's third-quarter earnings statement, Small said Gogo's next-generation 2Ku global satellite connectivity technology has already gained significant traction in the market, with long-term commitments from two airlines and plans to conduct trials on three others.

Small said the goal is to get the entire plane connected and engaged. Toward that end, the company in September announced a partnership with T-Mobile US (NYSE:TMUS) to deliver free in-flight texting and voicemail to T-Mobile customers on all Gogo equipped U.S. airline aircraft. That means T-Mobile customers can use the in-flight service on more than 2,000 commercial aircraft operating in the U.S.

For more:
- see the webcast (reg. req.)
- see this Runway Girl Network article

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