What Nixed the FirstNet Bid for Rivada?


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Why did the U.S. Court of Federal Claims favor AT&T for the FirstNet contract? Inside Towers reported the award was made last week for partial funding and the right for the carrier to build, deploy and operate the nation’s first nationwide wireless broadband network.

At the formal contract award ceremony AT&T Chairman/CEO Randall Stephenson called the bidding process “transparent.” The award was delayed several months after rival Rivada Network — a consortium comprised of Intel, Ericsson, Nokia and Fujitsu — sued the federal government after the group was excluded from the bidding process for the award of the public-private partnership agreement. At the ceremony, Commerce Secretary Wilbur Ross called the journey “one of the most complex bidding processes you can imagine.”

Indeed, in its decision, the U.S. Court of Federal Claims called it “a unique and complex procurement.” Rivada Mercury was formed specifically to pursue the FirstNet contract. In its complaint, Rivada contended that FirstNet erred “when it allegedly entered into discussions before it established the competitive range and then failed to ensure that those discussions were meaningful and not misleading.” Rivada also claimed the review of its bid was flawed. 

Congress specified that FirstNet has two primary components: a core network to provide connectivity between the radio access network, the internet and/or the public switched [telephone] network. The second component consists of cell site equipment, antennas, and backhaul equipment as part of the radio access network to enable wireless devices using public safety broadband spectrum.

The FCC is to reallocate “a substantial portion” of the 700 MHz band for FirstNet, which would get a 10-year exclusive license to use the band, according to the court decision. The FirstNet Source Selection Authority evaluated both bids for several factors, including business management, coverage and capacity, products and architecture and past performance.

Rivada proposed a “purpose-built, public safety focused network which offers a low market-entry price-point,” which “could encourage adoption and use” of the FirstNet network, according to its proposal. However the court noted the SSA found numerous deficiencies and weaknesses in Rivada’s proposal, related to “Rivada’s lack of financial stability, capacity, and required funding.”

Rivada’s proposal depended on “substantial third-party funding” to augment the funding provided by the government, according to the SSA, which said the consortium didn’t provide “acceptable evidence” showing that it could obtain the funding. Rivada’s plan also relied on a robust wholesale market in which customers would purchase FirstNet’s Band 14 excess spectrum capacity — a requirement which the SSA found risky.

The SSA also felt the consortium overstated the device connections, which would create a risk of insufficient revenue and saw a lack of executed agreements between the consortium and partners to build the network. The SSA said that meant FirstNet would have to take on faith those deals would solidify.

The court lastly found Rivada’s argument that the SSA erred when it eliminated Rivada from the competitive range “lacks merit.” The court denied Rivada’s motion for judgment and found in favor of AT&T, which was an intervenor in the case. Rivada did not appeal and the court decision cleared the way for the award.

Rivada recently said it will now work directly with states that chose to opt-out of the FirstNet federal solution, Inside Towers reported.

April 5, 2017        

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