At the end of April, AT&T announced they had partnered up with Honeywell to throw their hat into the inflight wifi ring by next year. However, on Monday the telecom giant said they will no longer pursue entry into the inflight connectivity realm.
This flies directly in the face of what I heard from AT&T only three weeks ago, as I sat at the National Business Aviation Association (NBAA) convention in Orlando. I listened to AT&T speak as though everything were still going full-speed ahead. They mentioned starting off with 400 antenna sites nationwide, to kick off the program, with anticipated download speeds of 30Mbps. They also mentioned wanting to leverage their U-Verse business and take it to the skies. AT&T made the cancellation announcement just days after trumpeting the acquisition of Iusacell, the largest telecom company in Mexico. In a statement, AT&T said:
"Last week we announced our intent to acquire Iusacell, a wireless company in Mexico. At the same time, and after a thorough review of our investment portfolio, the company decided to no longer pursue entry into the in-flight connectivity industry. We are focusing our capital on transformative investments, such as our Iusacell and DIRECTV deals."
The AT&T system was being developed to work with Honeywell's L-Band and GX satellite systems. Airlines and industry analysts had big expectations for the AT&T product. The April announcement was so disruptive that market leader Gogo's stock briefly plummeted. At that time, I spoke to one of Gogo's marketing guys, who said candidly that Gogo saw no threat from AT&T, and that if anything, it proved that Gogo was doing things right all along. Gogo's equipment is installed on 80 percent of all WiFi equipped planes in the United States, and shares jumped 10 percent following AT&T's news.
Top image via Associated Press