Flight attendants oppose it but IFC spectrum auction now likely

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A $340 million convertible notes offering will give inflight connectivity provider Gogo “the fire power” it needs to participate in a Federal Communications Commission auction of spectrum to support a next generation air-to-ground (ATG) network in the United States, company CEO Michael Small said today.

While the proceeds of the offering will naturally increase liquidity for the company, the reason for issuing it now is because an auction of ATG spectrum in the 14.0-14.5 GHz band (within the Ku band primarily used for satcom) could soon be decided by the commission, Small told attendees of Morgan Stanley’s Technology, Media and Telecom conference in New York.

“Our understanding is the final Report and Order is before the commissioners for consideration; they could vote at any time to authorize it,” he said. The FCC must decide whether to auction two, three or four licenses covering 500 MHz. Even if the commission auctions four 125 MHz licenses, and Gogo emerges with a single license, it’s still “a massive amount of spectrum and will allow many orders of magnitude” the bandwidth available to aircraft today, and a reduced cost per bit, said Small.

With this spectrum, the Gogo CEO believes “the gap between what’s possible on the ground and what can happen in the sky would essentially disappear over the continental United States”. Delta Air Lines has already signaled its intent to upgrade a large chunk of its narrowbody fleet with a next generation ATG solution from Gogo should the spectrum be secured. The solution would require new infrastructure, however, including new antennas on the ground and in the air, new electronics and new mobility management. “We would share the towers, the physical structure [of our current network] and backhaul, but it’s a totally new technology,” said Small.

The Association of Flight Attendants-CWA has been trying to put the brakes on the auction, and together with the Dillard Group International consultancy petitioned the FCC to first review operational and cyber threat scenarios and “attempt to develop appropriate, effective mitigations” before proceeding with the auction.

“Flight Attendants serve as the last line of defense in U.S. aviation, and our union is adamant that security must be kept at the forefront of any discussion on new technology,” AFA International president Sara Nelson told RGN. “AFA is encouraging the commission to bring together a broad range of government and industry subject matter experts and coordinate with them to assess the full scope of potential threats and vulnerabilities and attempt to develop and evaluate appropriate mitigations in the process of considering any final decision on the proposed rule.”

The FAA is already planning to establish an aircraft cyber security working group to address e-enabled aircraft. This could provide a venue for the union and others to thrash out their concerns, and help shape broader policy going forward for all connected aircraft, not just those offering next generation ATG-supported connectivity.

Gogo, meanwhile, seems fairly confident the auction will proceed, with Small saying, “conceptually any moment forward” the FCC could make a decision, after which the auction would likely take place “several months later”.