Rivada, Macquarie join forces on alternative to FirstNet

Rivada and Macquarie hope to provide an alternative to FirstNet.

Rivada Networks and Macquarie Capital said they’ll work together to pursue opt-out contracts for states considering alternatives to the first-responder wireless network being developed by FirstNet and AT&T.

And Colorado may be their first customer to sign on—if the state chooses not to go with FirstNet.

Colorado this week announced it has selected Rivada and Macquarie to build and maintain a dedicated LTE network for emergency works should Gov. John Hickenlooper decide against using FirstNet’s offering. The companies said they are “actively pursuing other opportunities” to provide services for wholesale wireless and public safety workers and agencies.

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“For states that opt out, our two companies will work together to develop and finance the build-out of their FirstNet opt-out radio access networks,” Nick Butcher, global co-head of Macquarie’s infrastructure and energy business, said in a press release. “We are pleased to have received the conditional award from the Colorado Governor’s Office of Information Technology and look forward to working with the state to develop this exciting project.”

Rivada and Macquarie face a tough challenge in convincing states to opt out of FirstNet, however. Governors in 31 states and two territories have announced decisions to opt in to use FirstNet, and commissions in Georgia and Florida recently recommended opting in to the governors in those states.

Rivada, Verizon and a handful of others are also competing to meet the wireless needs of first responders.

Final opt-in/opt-out decisions aren’t due until Dec. 28, though, and several other states appear to be on the fence as the deadline looms. California last week issued a request for proposal (RFP) seeking bids from FirstNet competitors, and New Hampshire Governor Chris Sununu last month signed an executive order establishing an “opt-out review committee” that will examine the regulatory and financial risks to the state were it to decide not to go with FirstNet’s offering.

Securing the FirstNet contract was viewed as a major win for AT&T, which will get access to 20 MHz of 700 MHz low-band spectrum and $6.5 billion for designing and operating the nationwide network for federal, state and local authorities, with the right to sell excess capacity on the system. AT&T will spend roughly $40 billion over the life of the 25-year contract to deploy and maintain the network, the Department of Commerce said, integrating its network assets with FirstNet.

But some states have begun to balk at FirstNet’s terms of service in recent weeks. Among other things, states are questioning spectrum manager lease agreements—SMLAs—that include hefty payments for opting out or terminating its agreement if they aren’t able to meet FirstNet’s technical requirements. Pennsylvania, for instance, would reportedly pay nearly $1 billion over 25 years to lease spectrum from FirstNet if it opted out, according to a recent report from Urgent Communications, and billions more if it didn’t meet technical and operational obligations. Similarly, California officials said opting out would require “an unrealistic number of subscriptions/connections” as well as nearly $3 billion in spectrum lease payments and more than $15 billion in penalties.

States that don’t make an official decision on FirstNet’s offering will automatically be opted in to the system, but even that won’t end the first effort to offer wireless services to the nation’s first responders. Cities and towns in states that opt in won’t automatically be required to fall in line; they can instead choose to go with another service. So the fight to meet the needs of those users is expected to continue long past the Dec. 28 deadline.

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