Apcela is acquiring the SmartSky Air-To-Ground (ATG) Network, the only alternative ATG network to incumbent Gogo for in-flight connectivity in the US. The company has a monopoly in single antenna solutions and Commercial Aviation ATG networks.
SmartSky Networks was founded in 2010 and invested over $680 million to develop and launch a competitive ATG in-flight connectivity (IFC) network to Gogo. The network was commercially launched to critical acclaim in 2023, but SmartSky had run out of funding by early 2024. Apcela plans to close on the acquisition and relaunch the ATG Network with a clean balance sheet and unencumbered assets, in early 2025.
The market timing is perfect, by December 2025, 2,600 business aircraft generating over $100 million in annual in-flight connectivity (IFC) service revenues will have to change out their IFC systems due to the government mandated shutdown of the Gogo legacy ATG network. In commercial aviation, we have a natural monopoly on ATG service to 1,500 regional airline jets and 1,200 package delivery company aircraft representing a $50 million market opportunity. With the only single antenna product, we can rapidly penetrate the 10,000+ business aircraft that have no in-flight connectivity services today. Finally, with the only IFC network offering enterprise grade performance and security in the market, we’re a natural add-on to the 8,000+ aircraft and corporate fleets using inherently unsecure satellite connectivity for both entertainment and mission-critical business applications.
Several key trends are also playing out in the IFC market to our favor:
* Reliability trumps bandwidth by a 4:1 margin in a new survey of 11,000 IFC users
* Regional airlines repurpose their older RJs for charter as they take new deliveries
* Digital Twins take center stage in commercial aviation for predictive maintenance
* The technology connecting airline cockpits will see its first upgrades in 50 years.
