Analyst Recommendation

Analysis

Gogo CEO Oakleigh Thorne said on Thursday that the company decided to postpone the 5G network plan originally scheduled to be launched this year to 2022 due to many serial problems caused by the shortage of global chipsets. However, the company declined to provide any other details, including which suppliers may be affected.

Infinera, an optical network company, has said that the global chip shortage in the next three months will cost it as much as 10 million US dollars. Infinera is one of the world’s leading suppliers of silicon and technology for core telecommunications networks. The company’s products are generally located in a crisscross fiber optic network, which carries most of the Internet traffic.

 

Gogo is not the only company affected by a global chip shortage: graphics cards, CPUs and game consoles have more problems due to short supply of chips, and automakers have to slow down their production lines due to tight supply. In response to this problem, President Joe Biden signed an executive order last month aimed at solving the shortage problem. These problems have affected industries ranging from medical supplies to electric vehicles. However, his order will not have an immediate effect. Instead, it requires various ways to strengthen the supply of chipsets for American companies, including the possibility of increasing domestic chipset production.

 

Gogo announced in 2019 that it would build a 5G network to provide airline passengers with Wi-Fi on board. The company plans to use AirSpan’s virtualized RAN base station technology, “proprietary modems” and massive MIMO antennas to upgrade its 250 base stations to 5G.

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