Gogo Business Aviation, which provides air-to-ground communications, continued to experience delays in the delivery of the 5G chip, which caused it to reduce its guidance for the year and for its long-term model. However, Oakleigh Thorne, Gogo, Chairman & CEO, told the company’s second quarter earnings call that he still expects “explosive” growth in 2025 and beyond. It is the second 5G delay for Gogo due to chip issues.
The problems are tied to a software glitch in the peripheral sub block of the chip, not the 5G chip itself. There are a lot of companies involved. Gogo’s supplier of 5G airborne and ground station radio technology is Airspan Networks, which uses GCT as a chip supplier. Samsung fabricates the chips for GCT and uses a sub design house to develop the standard blocks of the chips.
“While this is very disappointing, one has to understand that 5G chips are difficult to design and build, because of the dramatic increases in speeds and densification of transistors on the chip surface to enable those speeds,” Thorne said. “[These speeds] are much faster than any potential ATG competitor but the con is that we have borne some technology risk in doing so.”
With the 5G chip, Gogo will be able deliver ATG speeds that are five times to 10 times faster than current speeds, he added, which should be an average of 25 Mbps with a peak of 80 Mbps. Gogo said the 2,300 users of the AVANCE™ L5 inflight internet and entertainment can begin transitioning to the next gen technology, swapping out their current antennas for MB13 5G antennas that go into the same location as the old antennas.
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