A decision to show up in Washington, D.C., nearly two years ago is starting to pay off for AirCell Inc. as it attempts to revolutionize the way people stay connected through air travel.
Last month, American Airlines launched its Internet program powered by AirCell’s Gogo, an air-to-ground broadband system. AirCell also has deals to provide Internet access on flights from Delta Airlines and Virgin America. The company also plans to announce in the next week or so that it has signed another major airline to provide Internet service through Gogo.
“In the next few years, travelers will be able to catch any flight out of any hub that will have Gogo on it,” said Jack Blumenstein, AirCell CEO and president.
The projection is quite remarkable for a company that started 15 years ago in a one-room office in Boulder, Colo.
AirCell got its break in spring 2006, when the Federal Communication Commission held an auction for 800 MHz spectrum. Verizon Communications Inc., which owned some of the spectrum with its Airfone program, was the favorite going into the auction. But the industry giant ended up bowing out.
“I like to quote Woody Allen when he says 80% of success is showing up,” Blumenstein said. “Well, we showed up.”
A bid of $31.3 million won the 3-megahertz license for AirCell.
“It was a long shot that little AirCell could emerge with the exclusive license,” Blumenstein said. “Since that time it has been an extraordinary journey.”
The company now employs 350 workers and has offices in Broomfield, Colo., and Itasca, Ill.
Signing up customers
About two years after the auction, which included 18 months of rigorous testing by the Federal Aviation Administration, Gogo was deemed safe, and American Airlines was the first carrier to climb on board by offering Internet services to its passengers Aug. 20.
The airline has equipped 15 Boeing 767-200 aircraft with Gogo and is offering the service on 28 daily flights between New York and San Francisco; New York and Los Angeles; and New York and Miami. American Airline officials have said the service could be expanded to other domestic routes based on usage during the transcontinental flights.
Delta Airlines is planning to equip 330 of its commercial fleet with Gogo. The service is expected to be available by next summer. If the merger between Delta and Northwest Airlines goes through, an additional 250 airplanes will be equipped with Gogo, Blumenstein said.
AirCell also has teamed up with Virgin America and its fleet of more than 20 aircraft. Virgin plans on testing the program this fall and launch it by the start of next year, Blumenstein said.
Blumenstein said he is particularly interested in the Virgin launch because passengers will not need a laptop or wireless device to access the Internet. Virgin is planning to install screens on the back of seats to allow passengers to surf the Web.
AirCell and the airlines, which have agreed to share revenue, have set the price for Internet access for flights three hours or longer at $13. For shorter flights, the price is $10. The company also plans to offer a subscription with a monthly flat fee to frequent flyers. AirCell is also working with iPass Inc. to allow their clients access to accounts while traveling.
The network
Gogo works through an antenna system installed on aircraft and ground towers, Blumenstein said. AirCell has built 92 cellular towers equipped with three antennas across the country to provide 276 channels. Each of the tower locations overlap and provide coverage to 250 square miles.
Once an aircraft reaches 10,000 feet, the technology can be flipped on and passengers can start to surf the Web, check e-mail or work, all while traveling more than 400 miles per hour.
Blumenstein said the company is satisfied with the number of passengers who are using the service on the American routes.
“We are seeing high usage by repeat flyers,” he said.
The company is also seeing that passengers don’t necessarily need a laptop. Blumenstein said they have been surprised by the number of passengers using the service with their wireless handsets or smartphones.
As the commercial aspect of it business gets off the ground, Blumenstein said AirCell is also working to equip private aircraft with Gogo. The first private aircraft will be tested this month.
“Gogo will be a huge factor and game changer in business aviation,” he said.
As AirCell moves forward, Blumenstein said there are opportunities to expand into Mexico and Canada. Adding Gogo to international flights to Europe is a little trickier because it would take satellite technology to provide the service over the Atlantic Ocean.
Blumenstein said AirCell is not ruling out international flights but is mainly concentrating on North America.
“After all this time of rehearsing you can imagine how excited we are,” Blumenstein said of the American Airlines launch. “We barely have our toe in the water. By the end of next year, there will be about 2,000 commercial flights with broadband access.”
