The Business of Passenger Experience
Work as a senior executive in the inflight entertainment and connectivity business can be a fragile position. As the companies in the space continue to come up short on consistent and stable profits the likelihood of a sudden shift remains very real. Reports in to PaxEx.Aero suggest that just such a shift is underway at one of the leading providers in this segment.
Is there a secret to better financing of inflight connectivity solutions? Indonesia's Mahata Aero Technology (MAT) is the latest to take that plunge, with an arrangement to cover the costs for Garuda and Citilink. The deal relies on partnerships with suppliers Lufthansa Systems, Lufthansa Technik and Inmarsat, along with what MAT Executive Director Iwan Setiawan describes as "a unique business model" that is proving successful in its preliminary state.
As the installed aircraft count ticks higher for Viasat so, too, does the share of revenue the company realizes from that segment. The growth rate will slow in the coming year as the American Airlines fleet completes its conversion (more than 450 aircraft installed to date) but CEO Mark Dankberg believes there is still runway left in the market. Even if it is going to be a little later than previously expected.
Some good news for Gogo and its 2Ku airline customers as it reaches closure on an outstanding maintenance issue. This should ease the backlog as additional aircraft can once again be installed for three airline customers.
Fresh off the announcement of its first commercial airline customer, upstart inflight connectivity provider SmartSky secured additional funding to complete its nationwide network deployment. The company announced a $104mm investment, bringing the total investment for the company to nearly $350 million.
Gogo's operational structure is set to change. CEO Oakleigh Thorne has long hinted at adjustments he wants to make. The shifts were previously associated with discussions around potential change of ownership or debt refinancing. While those options remain on the table the moves will be made now, PaxEx.Aero has learned. Company employees were informed of the changes this week.
After nearly three billion dollars invested and eight successful launch missions the Iridium NEXT constellation is nearly complete. In just a couple weeks the final swaps will take place and the full complement of 66 NEXT satellites will be online. For Iridium the milestone brings a dramatic shift in business plans and economics. CEO Matt Desch is clear that reducing CapEx is a key near-term goal and that the company will remain focused on its niche markets, "If we can offer that service at 22-100kbps with a very small antenna that can be installed into a small drone or an automobile or a sensor in the ocean, that will expand the market tremendously. That is not a market that anyone is talking
about. We believe Iridium NEXT and Certus is best positioned to deliver on that." But he also makes clear that neither of those plans is truly absolute. Expect to see Iridium "bleed into some things" that don't truly fit the mold. Inflight services is one vertical where Certus will likely disrupt the status quo.
Antenna manufacturer ThinKom confirmed a second STC program currently active for its ThinAir Ka2517 kit. Although the company declined to provide any further details on which inflight connectivity provider or aircraft type is involved, some strong indicators are present, giving PaxEx.Aero confidence in naming a likely first buyer of the product. The A320 STC program...
With billions of dollars in contracts at stake perhaps it makes sense that Thales would seek extra help in securing new deals. That it stands accused of failing to pay its partner for that help is less good. That it now also likely faces scrutiny from US and international regulators related to suspicious payment schemes and efforts to influence leaders of foreign airlines is even worse. Welcome to the fun and exciting world of supplier deals in the Middle East.
The on again, off again drama of Chinese telecom manufacturer ZTE flared up again this week. Reports from the White House suggest that Huawei and ZTE could be the target of a new Executive Order banning the sale of systems from those companies in the United States. It would be invoked under the International Emergency Economic Powers Act, allowing the president to regulate commerce in response to a national emergency. And it could significantly impact the future of Gogo's Air-to-Ground data network, especially the ATG-NG development.
