LAS VEGAS – March 23, 2016. Two state officials said at the IWCE show here today that they have heard that representatives of Rivada Networks LLC have urged the governor’s office in their states to opt out of having the First Responder Network Authority’s (FirstNet) partner build their radio access networks (RANs). During a session this morning, Michael Saltzman, project manager in the Massachusetts Executive Office of Public Safety & Security, said that there was word that Rivada had pushed an opt-out “solution.”

“North Carolina had the same experience,” said Red Grasso, assistant director of FirstNetNC.

Mr. Saltzman told TRDaily after the session that Rivada had met with “somebody in the executive office level” without involving Curtis Wood, who is the FirstNet single point of contact and the state’s undersecretary-forensic science and technology.

Mr. Grasso told TRDaily that he and his colleague had heard that Rivada representatives had met with representatives of the governor’s office without the participation of Allan Sadowski, the FirstNet SPOC who is director-infrastructure planning at the North Carolina Office of Information Technology.

Rivada, which plans to submit a proposal in response to the FirstNet RFP (request for proposals), has been viewed with some skepticism and wariness over the years by some in the public safety community.

In response to comments by Mr. Saltzman during the session that Rivada had offered a solution to enable his state to opt-out, Declan Ganley, chairman and chief executive officer of Rivada, said, “That’s not correct.”

“We talk to whoever approaches us,” he said of discussions with states. “It tends to be, or has been historically, at a quite senior level.” He said that several conversations with state officials, although not from Massachusetts or North Carolina, have started with the states saying they plan to opt out.

“What we have spent time doing in recent times is talking people back from the ledge,” Mr. Ganley said. He also said it makes sense for states to “get a better understanding of the lay of the land,” including through the issuances of requests for information (RFI), and he noted that “there is no way to practically opt-out now” as states don’t even have plans delivered to them by FirstNet.

The comments directed at Mr. Ganley drew a buzz from audience members and even from some people who were not in the session but who heard about it.

Several sources told TRDaily today that Rivada had met with the governors offices in their states, with one saying the company was advising officials to at least consider their options. Another source said the company seemed to want to keep its options open if its bid for the FirstNet contract was not successful. “They’re getting around the states,” one source said.

In earlier comments during today’s session, which focused on the economics of building and sustaining FirstNet, Mr. Ganley said his company is confident it will be awarded the FirstNet contract, although he acknowledged that there will be “fierce competition.” He said the RFP “really calls for innovation” and can enable states to be “a full partner.”

Mr. Ganley touted Rivada’s proposal to monetize the FirstNet spectrum through a dynamic arbitrage system. Those revenues would be used to build the network. Such markets have been successful for electricity and oil, he noted.

James Mitchell, director-program management for FirstNet, emphasized that FirstNet wants the contract award to work for a potential partner. “Nobody wants to buy into a 25-year term if they don’t feel like they are being treated fairly,” he said.

He also said that while FirstNet is providing industry flexibility in how entities respond to the RFP, which does not impose requirements but instead pursues an objectives-based approach, “that whole RFP has to be addressed in some fashion” in proposals.

He also said that competition will be crucial in the process, saying that offerors should not take a “minimally acceptable approach. It’s got to be competitive.”

Mr. Mitchell also said that the Nov. 1 goal date for awarding a contract could change.  “That could be sooner or later depending on the complexity and the number of proposals,” he said.

Mr. Mitchell also said that while FirstNet has responded to the more than 400 questions it initially got about the RFP, it has received additional ones and is issuing seven answers to additional questions.

Attorney Art Katz highlighted what he said were problematic portions of the RFP and other uncertainties that potential offerors face in trying to make a bid.  One is a “potential nine-figure” penalty for a partner that does not meet performance metrics, he said. He also said that it will be difficult for companies to assess what revenues they can expect from the network because of the uncertainty over how many users there will be.

There was also discussion at today’s session about whether there would be less interest in submitting a proposal to FirstNet because the business case would not be as attractive if a number of states opt-out.

The challenge for a company making an offer is to structure it in a way that makes states want to let FirstNet build their RANs, Mr. Ganley said. “I think the opt-out thing is overdone,” he said, adding that it’s not an “Armageddon-like moment.”

“It’s not easy to be an opt-out state,” Mr. Katz added, citing timing, economics, and the lack of assurance of grant funding. “There’re pretty strong disincentives.”

Ray Lehr, a consultant and former state and local public safety official, stressed the importance of FirstNet’s contractor being “engaged with public safety from Day 1.” He also emphasized the need for public safety adoption if the system will be successful.

He also said that as State and Local Implementation Grant Program (SLIGP) funding runs out, states may need “seed money” to coordinate on FirstNet deployment.

During a keynote speech later today, FirstNet Chief Executive Officer Mike Poth also noted that some states have considered RFIs or RFPs, but he said that opting out is “a very challenging proposition,” including handling cybersecurity issues.

“We absolutely support states doing due diligence,” he said. But he said FirstNet will not be able to provide information to states on technical details of interoperability until after it awards a contract.

Mr. Poth also said that while he hopes that entities that don’t win the contract won’t challenge it, he said that it is likely someone will. Mr. Poth also addressed another common topic concerning FirstNet – how independent it is. While FirstNet is an independent entity within the National Telecommunications and Information Administration, many have complained that NTIA has been heavy-handed in its oversight of FirstNet. “We’re not encumbered,” Mr. Poth said.

At another session later today, FirstNet officials said that they have decided to roll back some of the technical specificity they had sought concerning coverage and capacity during the pre-award phase. FirstNet is releasing an amendment to the RFP with the changes tomorrow.

Also, FirstNet President TJ Kennedy stressed that states that opt-out are “likely to cause a two-year or more delay in that state.” – Paul Kirby, paul.kirby@wolterskluwer.com

Courtesy TRDaily