The latest from Gogo CEO Michael Small on why in-flight WiFi must improve

Gogo knows it must improve its WiFi. Photo: Gogo. 

Gogo knows it must improve its WiFi. Photo: Gogo. 

I listened this morning to Gogo's earnings call, and the company did not share a lot of information we don't already know. Gogo is aware it must improve its service, and it wants to persuade airlines to upgrade. 

Gogo knows its current air-to-ground system, which relies on cell towers, does not provide enough bandwidth to planes. It knows customers on American, Alaska, Delta and Virgin America are frustrated. They can never stream from NetFlix or Amazon and on some flights, the system is hardly fast enough to allow basic web browsing. 

Gogo wants airlines to switch to its new satellite-based system called 2KU, which it says is at least seven times faster than today's air-to-ground Internet. So far, among major U.S. airlines, only Delta has committed to adding it, and only on a portion of its fleet. American Airlines could be next, though that's far from a sure thing. American may switch to another provider.

If and when airlines adopt the new system, Gogo CEO Michael Small told analysts, it will change the passenger experience.

"Consumer demand is really constrained by bandwidth on our network right now," he told analysts. "But every indication we have is to bring more bandwidth to the aircraft, you are going to see skyrocketing passenger demand. That is almost a given in today's world. It happens everywhere."

He predicted 100% of passengers will someday use WiFi in one form or another. 

For now, Gogo usually has a one-size-fits-all platform. You either pay the going rate for WiFi, or you're not connected. But in the future, with more bandwidth, Small predicted airlines could offer tiered service on Gogo. 

"Premium models, all different models, we are exploring all of those with different airline partners," Small said. "They are clearly on the table now, and we expect to actually see a lot of different approaches in the marketplace, and it's all enabled by more capacity."