LAXintl
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Inflight Wi-Fi Gogo Plans IPO (again)

Mon Jun 17, 2013 8:06 pm

Inflight Wi-Fi provider Gogo has dusted off it plans to go public with a planned IPO in the coming week.

Amid continued losses and uncertain market conditions Gogo pulled plans for an IPO in 2011 and instead turned to several rounds of debt financing to fund ongoing operations.

The company now seeks to relaunch its IPO efforts and seeks to raise between $165mil-185mil.

Per its latest financials, Gogo which is fitted on neatly 1,900 aircraft saw its net loss widen for the first 3-months of 2013 to $32.5mil from $17.6mil in 2012.

Story:
http://articles.chicagotribune.com/2...ight-wi-fi-provider-ipo-plans-gogo

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SIA747Megatop
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Mon Jun 17, 2013 8:54 pm

Seems like strange economic circumstances to be launching an IPO considering there is talk that Bernanke & co. may reduce QE as the most recent unemployment and GDP data turned out positive.

I don't know much about the company but widening losses against increasing revenue doesn't seem too promising coupled with the fact that they already represent 81% of WiFi fitted aircraft in the US.
"I do not yet know of a man who became a leader as a result of having undergone a leadership course." - Lee Kuan Yew
 
LAXintl
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Mon Jun 17, 2013 9:29 pm

In my opinion the pressure is on as they can only continue generating so much in debt financing. Only in April they secured another $113 million in such monies.

At the end of the day, the way I see an IPO is simply garnering money to help pay off previous debts and get some of these debt issuers stock in their pockets.

For all the success Gogo has had now being fitted on some 1,900 planes, the business model is still very iffy as the red ink continue to flow 5-years in.
From the desert to the sea, to all of Southern California
 
wjcandee
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Tue Jun 18, 2013 12:09 am

Red ink after 5 years? You mean like Amazon.com?

The point for them now is to leverage the installations to include IFE, which they are doing, and which is a pretty good idea. I don't need that little screen if I can watch on my laptop or tablet, which is a bigger, better screen that I like.
 
cschleic
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Tue Jun 18, 2013 12:45 am

Quoting wjcandee (Reply 3):
The point for them now is to leverage the installations to include IFE, which they are doing, and which is a pretty good idea. I don't need that little screen if I can watch on my laptop or tablet, which is a bigger, better screen that I like.

Do they have the bandwidth? Wifi videos are bad enough at home with one or two PC's; on a plane with 100 going at once.... hard to imagine. It would only work if VERY robust.
 
jayunited
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Tue Jun 18, 2013 1:30 am

Quoting cschleic (Reply 4):
Do they have the bandwidth? Wifi videos are bad enough at home with one or two PC's; on a plane with 100 going at once.... hard to imagine. It would only work if VERY robust.

That is the same question I was thinking because Gogo uses ground based WIFI which is very slow. Do they have a plan in place to increase their bandwidth so that the system is capable of handling IFE as

Quoting wjcandee (Reply 3):

suggested?
 
MIflyer12
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Tue Jun 18, 2013 2:08 am

Quoting cschleic (Reply 4):
Do they have the bandwidth? Wifi videos are bad enough at home with one or two PC's; on a plane with 100 going at once.... hard to imagine. It would only work if VERY robust.

IIRC, the implementation of Gogo video isn't streaming video to the aircraft; video is loaded to a server aboard the aircraft and is then available for purchase (via built-in video displays, or via wifi on passenger tablets, etc.) This video makes little demand (payment transactions) on the ground-to-plane connection.
 
dtw2hyd
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Tue Jun 18, 2013 2:30 am

Quoting jayunited (Reply 5):
That is the same question I was thinking because Gogo uses ground based WIFI which is very slow. Do they have a plan in place to increase their bandwidth so that the system is capable of handling IFE as

It uses ground based Mobile Broadband service to provide internet connection to the aircraft. WiFi is internal to aircraft to share the internet. Just like a Verizon/Sprint/AT&T MiFi router.

Keep in mind IFE Media Server is within the aircraft. You don't need internet bandwidth to handle IFE, you just need good WiFi equipment within the aircraft, which can be easily implemented. IEEE 801.11ac protocol on 5 Ghz gives the best video streaming upto 866.7 Mbps, but as there are only few latest devices work on 5Ghz, for backward compatibility IEEE 801.11n on 2.4 Ghz with throughput up to 150 Mbps most likely be used.
 
wjcandee
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Tue Jun 18, 2013 3:56 am

Exactly. You can easily set up a wifi network within the aircraft that will happily stream to 250 devices at the same time. If your content is on the onboard server, all you need the ground connection for is to (1) charge the fee to their credit card and (2) let them check their email and surf the web, which uses very little bandwidth.

I just used Gogo from JFK-LAS and return on Delta, and anything that I wanted to do was as fast as at home -- actually the latency was a little better on the plane than my Time Warner home internet connection in Manhattan, and a heck of a lot better than at the office. And this was so all the way across the country, which I still find to be pretty darn amazing. And that ground-based system is a heck of a lot cheaper to operate than satellite service. (They will have satellite for international flights on DL.)

The ATG-4 ground system they are rolling out will give about 9.8mbs to the plane. Right now, it's about 3.1 per channel.

This link explains how Gogo Vision (the full IFE system) will work: http://gogoair.mediaroom.com/2012-09...on-Fleet-of-Gogo-Equipped-Aircraft
 
jayunited
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Tue Jun 18, 2013 2:51 pm

Quoting DTW2HYD (Reply 7):
It uses ground based Mobile Broadband service to provide internet connection to the aircraft. WiFi is internal to aircraft to share the internet. Just like a Verizon/Sprint/AT&T MiFi router.

Keep in mind IFE Media Server is within the aircraft. You don't need internet bandwidth to handle IFE, you just need good WiFi equipment within the aircraft, which can be easily implemented. IEEE 801.11ac protocol on 5 Ghz gives the best video streaming upto 866.7 Mbps, but as there are only few latest devices work on 5Ghz, for backward compatibility IEEE 801.11n on 2.4 Ghz with throughput up to 150 Mbps most likely be used.

So this may sound like a crazy question but I'm not a techie person I know you need a server but as far as all the protocols go you lost me and that fine. But my question is what is the difference (besides the obvious) between ground based Mobile Broadband and Satellite? And with a lot of airlines looking to invest in satellite is Gogo going to switch their system over to satellite based system so that in the future they won't loose customers because from what I understand the only way WIFI will work for the entire length of a international trip excluding Canada or Mexico is it must be satellite based?
 
LAXintl
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Tue Jun 18, 2013 4:12 pm

Gogo already has a satellite offering.

A short primer -

Gogo in 2006 won an FCC auction for frequency and license from the former GTE airfone network for about $30mil. They then by 2008 built out a nationwide ground network and launched (ATG - air to ground) service using much of the airfone backbone. This was basically airbone 3G service.
Very recently Gogo has upgraded the system to something know as ATG-4 - EVDO-B technology - faster more bandwidth.

Gogo has also begun shifting to satellites and have completed deals with Intelsat/Iridium(ku band) and for the future with Inmarsat(ka band).
Current satellite offering is available to airlines, but mostly taken up by business aviation. When Inmarsat goes live with a new line of satelites in 2015, the ka-band solution would allow for global coverage at quite good throughput.

But getting into satellites directly is a billion dollar proposition, so folks like Gogo go out and buy bandwidth from these other companies and basically hope to resell at enough of a profit margin to cover all its overhead, and of course all the installed equipment cost.
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dtw2hyd
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Tue Jun 18, 2013 6:17 pm

Quoting jayunited (Reply 9):
But my question is what is the difference (besides the obvious) between ground based Mobile Broadband and Satellite?

Ground based network uses standard Mobile Data Network like any other Smart phone, Satellite based network uses ku/ka band. Other difference is cost, ground based network is far cheaper than sat network and obviously there is no way to implement a ground based network over sea.

Sat network is similar to Hughes Network Internet service. You might have seen their ads and probably only Internet option for someone who lives on a remote farm/ranch where DSL/Cable Internet service is unavailable.

There are several WiFi standards/protocols, latest being "ac". ac provides better video quality. Old standards are n/g/b/a.

BTW, most of the programming on IFE is pre-loaded to Media Server according their schedule, including paid on demand options. They may get updates like NBC Nightly News/CNN/BBC over data link or while they are on ground. Other than that as the data network is used for just of credit card transactions.

JetBlue takes the Satellite TV to next level by providing DirecTV live feed. Different story.
 
werdywerd
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Tue Jun 18, 2013 7:35 pm

Can't wait for JetBlue to start rolling out on-board wifi

http://www.jetblue.com/flying-on-jetblue/wifi/

Its all satellite based through ViaSat
http://www.viasat.com/news/Aviation+Broadband

It will have so much bandwidth available that every passenger on board will be able to be connected and still get up to 12Mbps downloads. That means super fast streaming and surfing for everyone!
 
LAXintl
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Tue Jul 02, 2013 5:30 pm

Well they had their IPO and shares are down 20% in the first full week.

As an analyst put it.
"The offering of Gogo has been quite a disappointment."
and
"Despite the strong 81% market share position the lack of profitability and potential for increased competition make this a questionable investment thesis."

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jetblueguy22
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Tue Jul 02, 2013 7:32 pm

Quoting LAXintl (Reply 13):
Well they had their IPO and shares are down 20% in the first full week.

Now I'll never pretend to fully understand corporate numbers. But a Q1 net profit margin of -20% is pathetic. There is no way that is sustainable. I hope they pull through as I love their product. But boy, those are not very impressive numbers. Did they really need capital that bad that they decided to go public?
Pat
All of the opinions stated above are mine and do not represent Airliners.net or my employer unless otherwise stated.
 
dlednicer
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Tue Jul 02, 2013 7:38 pm

Quoting werdywerd (Reply 12):
Can't wait for JetBlue to start rolling out on-board wifi

Take a look at the future:
https://twitter.com/DavidJBarger/status/350686385985970176/photo/1

More info:
http://www.jaunted.com/story/2013/6/...p+with+JetBlue's+In-Flight+WiFi%3F

[Edited 2013-07-02 13:24:33]
 
wjcandee
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Tue Jul 02, 2013 10:23 pm

Quoting werdywerd (Reply 12):
Can't wait for JetBlue to start rolling out on-board wifi

At the moment, it's "Vapor-Fi". It's hard to imagine that it will be free, or even reasonably-priced, for any period of time, if it is a satellite based connection with the bandwidth that you say it has. But we will see.
 
N62NA
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Tue Jul 02, 2013 11:58 pm

I hope (like most of you I think) that GoGo will succeed. If they don't it's back to the stone ages with regards to onboard internet connectivity.
 
LAXintl
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RE: Inflight Wi-Fi Gogo Plans IPO (again)

Wed Jul 03, 2013 1:45 pm

Quoting wjcandee (Reply 16):
It's hard to imagine that it will be free, or even reasonably-priced, for any period of time,

  

Even JetBlue was rather careful with their commitment. Here are a few more comments from Robin Hayes, the airline’s chief commercial officer.

JetBlue may offer the service free for most passengers but charge those who want to stream movies and other such entertainment.

“We are going to find a way, if we can, of keeping it free for the long term, and we have some ideas of trying to make that happen,” he said.


What does "may" and "most" mean at the end of the day?? Clearly they along with everyone else are still trying to conceptualize a wi-fi business model that is sustainable.

http://articles.latimes.com/2013/mar...ess/la-fi-mo-jetblue-wifi-20130322

Also personally, I have long been leery of JetBlue's ownership of LiveTV as the financial reporting and business dealings internally have been rather murky.

B6 CFO last year was quoted as saying “there is no compelling reason why an airline should own it”. and speculation has continued when B6 would divest it.
http://blog.apex.aero/ife/jetblue-ho...ds-livetv-sale-ka-ku-battle-heats/

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