AT&T drops plans for LTE data networking on commercial flights

US mobile carrier AT&T is scrapping its plans to roll out high-speed data connectivity for commercial airline flights, a mere six months after announcing the effort.

The wireless provider said in April that it had formed a partnership with Honeywell to develop an in-flight internet network based on 4G LTE technology.

Under that scheme, AT&T would have been responsible for beaming data bits to planes travelling at 35,000 feet, while Honeywell would have provided the onboard infrastructure to allow passengers to connect their devices.

But in a statement on Monday, AT&T said it's giving up on the US in-flight broadband market, which is currently dominated by specialist wireless firm Gogo.

"After a thorough review of our investment portfolio, the company decided to no longer pursue entry into the in-flight connectivity industry," an AT&T spokesman told Reuters. "We are focusing our capital on transformative investments, such as international and video."

The firm's portfolio has swelled somewhat this year. On Friday it snapped up Iusacell, Mexico's third largest mobile operator, for $1.7bn. And in May it offered $49bn to buy satellite TV provider DirecTV, a move that has yet to meet regulatory approval.

Gogo, meanwhile, has been offering internet access on commercial flights since 2008, having won an exclusive license to the 3GHz air-to-ground frequency band from the Federal Communications Commission in 2006.

The firm currently has deals in place with 12 airline partners, including Aeromexico, American Airlines, Air Canada, AirTran Airways, Alaska Airlines, Delta Air Lines, Japan Airlines, United Airlines, Us Airways, Vietnam Airlines, Virgin America, and Virgin Atlantic.

In addition to data networking, Gogo has been looking to expand into phone calls and texting, via smartphone software that can link its in-flight Wi-Fi systems to cellular towers on the ground.

Neither AT&T nor Honeywell gave any reason for canceling their in-flight networking partnership, with the former saying only that it plans to refocus its efforts on other areas.

The move seems poorly timed, as the in-air broadband market is ripe for expansion, with the Federal Aviation Administration having recently loosened restrictions on when passengers can use electronic devices during flights.

If there was one group that was thrilled to see AT&T and Honeywell give up on their plans, however, it was Gogo shareholders. Gogo's stock price leapt on the news, rising nearly 11 per cent in after-hours trading. ®