GOGO shares decline overdone?
Why is Gogo Inc (GOGO) down 40% this morning? That would be that American Airlines is threatning to pull Gogo's inflight Wi-Fi internet service from its 200 planes. Gogo has almost 11,000 planes fitted worldwide, so doesn't a measly 200 seem overdone?
Who could do a better job than Gogo? That would be ViaSat (VSAT). American wants to give VSAT a try and is going to allow Gogo to compete side by side. Only problem is that VSAT is used by the modern airlines of this past decade, JetBlue (JBLU) and Virgin American (VA). Recall this gem of a press statement last Sept. from Virgin:.
NOW STREAMING NETFLIX – AT 35,000 FEET: VIRGIN AMERICA TEAMS UP WITH NETFLIX TO OFFER TRAVELERS FREE WIFI ACCESS TO THE WORLD’S LEADING INTERNET TV NETWORK
New High-Speed ViaSat Satellite WiFi Launches this Month on Virgin America, Allowing Guests to Stream Video in the Air – Just Like at Home
San Francisco – September 29, 2015 – Today, Netflix, the world’s leading Internet TV network, and Virgin America, low-fare, upscale airline known for offering next generation entertainment and connectivity, announced they are joining forces to provide complimentary in-flight WiFi access that allows new and existing Netflix members to enjoy the entire Netflix catalog of films and award-winning shows. Beginning today, Netflix users onboard Virgin America’s new ViaSat WiFi-equipped aircraft will be able to stream the best programming available in the skies, including the hit series House of Cards and Orange Is The New Black, to their phones, tablets, and laptops at no cost through March 2, 2016*. The experience is made possible by Virgin America’s recent connectivity partnership with ViaSat, which brings significantly faster WiFi to the airline’s 10 new airbus A320 aircraft being delivered from fall 2015 to mid-2016. In addition to offering free streaming through its new ViaSat WiFi network, as of next month, Virgin America will also offer House of Cards seasons 1-3 for free on the airline’s recently upgraded Red® touch-screen seatback in-flight entertainment platform – so travelers can binge-watch through their own devices or their seatback.
Year-to-Date VSAT shares are up 12% while GOGO is down 48%. Yikes. Today's movement in GOGO is all based on American Airlines declaratory judgment action last week against Gogo. American can get rid of GOGO if a competitor (i.e. VSAT) can "materially improve upon Gogo’s service". Gogo is allowed to submit a competing proposal which they will do using their satellite technology, 2Ku. “We believe that 2Ku is the best performing technology in the market and look forward to discussing our offer with American,” Gogo said.
Best of the Blogs
Scanning and identifying the best blog entries every hour
- One Trader Is Surprised At Market Euphoria From A "Result That Was Everybody's Base Case" | ZeroHedge
- A Delighted Wall Street Reacts To The French Election | ZeroHedge
- New Snowflake Study Proves Kanye Right: "That Major That She Majored In Don't Make No Money" | ZeroHedge
- Google Market Cap Hits An All Time High $600 Billion | ZeroHedge
- JD Power Lowers 2017 Auto SAAR As High Discounts "Threaten Industry's Long-Term Health" | ZeroHedge
- Populism and the Long-Term Debt Cycle | Financial Sense
- US Destroyer Has Close Encounter With Iranian Vessel in Straits of Hormuz | ZeroHedge
The most relevant financial news and articles from the Internets
- After half a dozen trips abroad, I'm convinced an old-school travel tool is always worth... | Business Insider
- Tucker Carlson applauds Bill O'Reilly on his first night in O'Reilly's time... | Business Insider
- 3 websites a smart job hunter checks every day | Business Insider
- JOHN KASICH: Here's what surprised me about Trump's first 100 days | Business Insider
- How China's aircraft carriers stack up against other military powers | Business Insider
- At least 1 killed, 12 injured in a fiery crash on a Los Angeles highway | Business Insider
- THE SMARTWATCH REPORT: Forecasts, adoption trends,... | Business Insider