Airbus A321 Cabin. Photo: Airbus

[Via Satellite 5-23-2014] United States telco giant AT&T has been making waves in recent months. Its deal to acquire DirecTV is a huge statement of intent, and a gateway into the lucrative Direct-to-Home (DTH) market. But AT&T is not stopping there; the company is also planning to launch In-Flight Connectivity (IFC) services in combination with Honeywell next year. An AT&T source who requested anonymity told Via Satellite the company “sees a significant market opportunity” for IFC services.

“As we have seen in our mobile business, as the network improves, customers are able to do more with their mobile devices. Subsequently, they are willing to spend more money to keep those devices connected. Both the customers and AT&T stand to benefit from an improved in-flight connectivity experience,” the source said.

Andrew Spinola, a telecoms equity analyst at Wells Fargo, believes AT&T and Honeywell’s plans will definitely shake-up the market.

“AT&T’s service could impact the satellite opportunity longer-term depending on how AT&T deploys its network (i.e. how much spectrum T will deploy),” he said in a research note. Gogo is currently spectrum-constrained with just 4 MHz of spectrum (only 3 MHz in use) and so satellite is expected to displace Gogo’s current Air-to-Ground (ATG) service over-time. However, any wireless carrier could create a more competitive service if it is willing to commit larger spectrum bands to the ATG service and make the investments necessary to support the business, including network operations, billing services and customer care.”

This is AT&T’s plan. The company aims to launch an expansive ATG service in late 2015, using a number of alliances with industry leaders to deliver what it hopes will be superior end-to-end customer experience across hardware, installation, maintenance and support, network operations, and more.

“We will provide information on our airline customers prior to launch and will seek necessary regulatory approvals,” Via Satellite’s source said.

AT&T operates one of the major 4G LTE networks in the United States, and the company believes it has the capability “to transform airborne connectivity” by leveraging its expertise, spectrum and financial strength.

“We see an opportunity to deliver an innovative and high-performing in-flight connectivity and entertainment service, and will build on existing relationships within the aviation industry to deliver a better customer experience than what is available from others today. We expect this service to transform connectivity in the aviation industry — we are truly mobilizing the sky,” Via Satellite’s source said.

The partnership with Honeywell will be key to the success of this project.

“We plan to work with Honeywell to provide hardware and service capabilities to deliver a high-speed 4G LTE based in-flight connectivity service for airlines and passengers in commercial, business and general aviation,” our source said. “Along with Honeywell’s expertise, our technical strength and scale in building networks and managing their evolutions provide a unique opportunity to change the way passengers and airlines connect to the mobile Internet.”