Aircell nets $35M funding round

In-flight broadband provider Aircell has raised US$35m via a funding round from its existing investors, Ripplewood Holdings services and Blumenstein/Thorne Information Partners, as well as management.
Proceeds from the financing will be used to fund…

In-flight broadband provider Aircell has raised US$35m via a funding round from its existing investors, Ripplewood Holdings services and Blumenstein/Thorne Information Partners, as well as management.

Proceeds from the financing will be used to fund growth in both the commercial and business aviation markets.

Michael Small, Aircell President and CEO, stated: “2010 was the year in-flight internet went mainstream and Aircell established its leadership in this exciting new mobile internet venue. Since securing our exclusive spectrum license in 2006, we’ve raised more than US$500m.” In its last funding round back in March 2010, Aircell raised US$176m in a private placement that was used to support its increased capex requirements as it expanded its global network. Aircell predominantly focuses on air-to-ground in-flight broadband utilising a network of terrestrial cellular towers and has spent the past year expanding this network throughout North America, particularly into Canada.

By the end of 2010, Aircell’s Gogo in-flight internet service was available on more than 1,050 commercial aircraft, including those of American Airlines, Delta Airlines and Virgin America, while it had almost 6,000 customers in the business aviation market. In October, the company signed a deal with aircraft manufacturer Bombardier Aerospace that will see the latter pre-install Aircell’s equipment on some of its new aircraft.

The company stated that in 2011 it expects to increase its base of installed aircraft by an average of three per day in the airline market. This growth has enabled Aircell to dominate the North American in-flight broadband market and the company is expected to undertake an IPO by the end of the year.

Given the obvious terrestrial limitations of the air-to-ground technology, a number of Aircell’s rivals have sought to use satellites to offer in-flight internet services over sea. Aircell is also thought to be weighing up such an offering once it has completed its North American network.

Aircell is also thought to have held preliminary talks with North American satellite broadcasters over the possibility of providing their services on board commercial airlines.