With the ubiquity of easily and quickly accessible Wi-Fi in our homes, our offices, and in our friendly neighborhood Starbucks, it’s difficult to imagine passing very much time without being connected to the Internet. That’s especially true when trapped aboard a long flight.
Taking advantage of our dependence on being online are in-flight Wi-Fi providers, who are now charging truly exorbitant amounts for their services on an already expensive mode of transportation. As the New York Times reports, an April flight from Los Angeles to New York, a five and a half hour journey, saw Wi-Fi prices of $27, double the already steep price of $13 of just three years ago. And unfortunately, while Gogo and other providers’ speeds are going up, so too are their prices, and by very considerable amounts.
On Mondy, Gogo announced that it had received clearance from the Federal Aviation Administration (FAA) to increase the bandwidth of their current offerings twentyfold. With speeds now reaching up to 70 Mbps, it will be possible to actually do work on an airplane, rather than spending more than half your time waiting for that annoying page to finally load. And considering that Gogo’s current speeds max out at around 3 Mbps, that’s literally what many frustrated customers did after forking over very substantial sums to the so-called provider of Internet service.
But with Gogo’s speed increases will also come price increases. The company, which as Bloomberg notes, holds a veritable monopoly over the in-flight Wi-Fi industry (it controls 80 percent of the market), has successfully charged desperate passengers up to $40 for the use of incredibly slow Wi-Fi these last couple years.
Because Gogo’s pricing model is predicated on demand, much like Uber and its surge pricing, the more people there are who want to access the web while in the air, the more it’ll cost them. As analyst Tim Farrar told Fortune Magazine, “Gogo has figured out that you make more revenue by charging as much money as possible to a very small number of people. Typically, only 7 percent of passengers opt to pay for Internet on Gogo flights, but that’s enough for Gogo to cover its costs and send a big check to its airline partners each month.”
And of course, the speed increase is still a long time coming. They will have to install brand new hardware on all participating planes, which certainly won’t happen overnight. So despite claims of faster Internet, you may not see this reality manifest until much, much later.
Gogo itself remains upbeat. “We believe this will be the best performing technology for the global commercial aviation market, bar none,” said the firm ‘s chief technology officer Anand Chari in a related statement. “Clearing this regulatory hurdle brings us one step closer to enabling our airline partners and their passengers to enjoy the future of in-flight Internet.”
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