Lousy in-flight Internet may soon be a thing of the past as AT&T partners with Honeywell to build an air-to-ground network based on its existing 4G LTE network it uses for smartphones and tablets.
Gogo, currently the biggest provider of in-flight Wi-Fi, saw its stocks nosedive by 24% in after-hours trading following AT&T's announcement. Global Eagle Entertainment, parent company of Row 44, also fell by 10%.
The new network, which AT&T expects to be up and running in the United States by the end of 2015, aims to provide speedy Internet access to airline passengers similar to the 4G access they get on the ground. As every person who has ever connected to in-flight Wi-Fi knows, using the internet on the plane is not as pleasant experience as it is when done at home or at the office.
In a survey conducted by Honeywell, nine out of 10 people in the United States who have plugged in to a plane's Wi-Fi said they are not happy with it. This is due to Gogo's limited-bandwidth network, which can accommodate only 6% of the total number of passengers on a plane.
"Everyone wants access to high-speed, reliable mobile Internet wherever they are, including at 35,000 feet," said AT&T chief strategy officer John Stankey in a press release.
"We are building on AT&T's significant strengths to develop in-flight connectivity technology unlike any other that exists today, based on 4G LTE standards. We believe this will enable airlines and passengers to benefit from reliable high speeds and a better experience," he added.
AT&T believes its new service will also provide better communications between the flight crew and the ground.
The competition, however, plans not to be outdone. Gogo's current service may be a bane to customers, but airlines offering Gogo-based in-flight Internet have agreed to a 10-year contract with the firm. By the time the term ends, Gogo will likely have come up with new technologies that will even out the competition.
In 2012, Gogo introduced ATG-4, its upgraded air-to-ground network that can deliver a speed of up to 9.8 Mbps, which is three times the speed of its earlier network. The new service sees the addition of directional antennas and dual modems for each aircraft that uses the network. Three airlines, namely Delta, US Airways and Virgin America currently offer ATG-4 in-flight Internet to its passengers, with several others being courted by Gogo.
Gogo also plans to launch ground-to-orbit and full-satellite networks that can provide over-water Internet services of up to 70 Mbps.
Although AT&T did not specify the projected speed for its planned in-flight Wi-Fi service, its 4G mobile Internet typically runs anywhere at 5 to 22 Mbps.
"We pioneered this industry. We've been at it for two decades and it's gratifying that the biggest companies want in right now," Gogo chief executive Michael Small said in an interview.
