T AT&T Inc

By Ryan Knutson and John D. McKinnon 

The Trump administration on Thursday is expected to announce a $6.5 billion deal with AT&T Inc. to build a nationwide wireless broadband network for first responders, a project that was proposed after the 9/11 terrorist attacks but has struggled to get off the ground.

The decision is a major step forward for FirstNet, as the program is called, though it still faces challenges. Some states are unsure whether to join FirstNet or build their own networks, and a politically connected startup that lost out on the contract is encouraging them to opt-out.

Wilbur Ross, the Commerce Secretary, is expected to announce the 25-year contract to AT&T and its partners, which include Motorola Solutions Inc., according to people familiar with the matter. The earliest construction could begin is later this year.

A nationwide wireless broadband network that police, fire and other first responders could use exclusively during an emergency was one of dozens of recommendations made by the 9/11 Commission in 2004 -- it is the only one that hasn't been completed, the Commerce Department says. During 9/11, communication breakdowns are thought to have been a major contributor to deaths among first responders.

Currently, first responders share wireless networks with regular consumers, meaning communication between police officers regarding an active shooter, for example, can get clogged by the same network congestion a smartphone user faces when streaming a YouTube video.

"It will be a great thing for us," said Neil Miller, the Buffalo County Sheriff in Kearney, Neb. Mr. Miller's department currently pays Verizon Communications Inc. for wireless service, which supports remote command posts, patrol cars and officers' devices. Like regular customers, Mr. Miller's staff has faced slower connections when people pour into town for a regional car show.

"Public safety has no priority right now," Mr. Miller said. "We are just another user. We look the same in the network as everybody else."

The 2012 congressional legislation that created FirstNet allows for states to build their own alternative systems. Already, some states, including Colorado, New Hampshire, Alabama, Arizona and Michigan have been exploring the possibility of opting out. Because more populated areas help subsidize more rural ones, some experts say FirstNet's viability could be endangered if too many states drop out.

Ryan Burchnell, executive director of the Alabama Law Enforcement Agency, said Alabama is just doing due diligence. "If you don't look at the alternatives, I don't know how you make an informed decision," he said.

An upstart company that lost the competition for the federal contract has said it will make a concerted effort to win state contracts to run independent networks. The company, called Rivada Mercury LLC, has said the network will be "won or lost at the state level."

The startup is run by former wireless industry executives and has joined with other vendors such as equipment makers Ericsson AB and Nokia Corp. It also has deep political ties. Presidential candidates Jeb Bush and Martin O'Malley are among its board members.

"Do you want to be line item 1? Or line item 4,363. And that's where public safety is for the budgets of these carriers," Declan Ganley, Rivada's chief, said. "This is not a rejection of FirstNet, it's just a different way of fulfilling the mission."

Rivada sued in November to block the federal government from awarding the contract to AT&T, but the case was struck down earlier this month by the U.S. Court of Federal Claims.

The Fraternal Order of Police has criticized the process. The group worries the procurement process has been opaque and that AT&T may not be willing to spend to build connections in extremely rural areas where there's little usage.

"It would be an understatement to say we were disappointed" with the government's handling of the project, Jim Pasco, a senior adviser to the Fraternal Order of Police, said in a recent interview. "AT&T is a reputable company. But they're a reputable company doing what reputable companies do: They're trying to make a profit."

AT&T declined to comment on the criticism. "We are waiting for FirstNet to announce the award, just like everyone else," a spokesman said. In a December regulatory filing, the company said it looked "forward to serving the public safety community through this contract and making a significant investment in the infrastructure of our country."

FirstNet Chief Executive Michael Poth said the review process has been rigorous and included endorsements from other public safety groups. Mr. Poth said he is confident states will choose FirstNet rather than opt out and build on their own.

There are many challenges in building a nationwide public safety service. Unlike the existing networks that are built around population centers, FirstNet is intended to offer more complete coverage in less populated areas where it doesn't make financial sense for the carriers to spend.

Cost estimates for the FirstNet project vary widely, from $12 billion to $47 billion over 10 years, according to the Government Accountability Office. There aren't enough police and fire departments in the nation to support the cost of construction and operation.

The current project seeks to develop a self-funding network that earns revenue from subscription fees from first responders and will be subsidized by allowing AT&T to resell excess capacity to commercial customers. The $6.5 billion comes from a 2015 government airwaves auction, and FirstNet will also give the winner a large and valuable swath of wireless airwaves.

This is the third attempt at getting a network built. In 2008, the Federal Communications Commission tried auctioning wireless airwaves to cellphone carriers with the condition that the winning carrier had to give first responders priority network access, but no company bid high enough to win.

Then, the Commerce Department doled out grants for local governments to build their own networks. By 2012, more than 20 counties, cities and states signed up and more $300 million was distributed. But officials feared each area would use different technologies and be unable to integrate into a unified system. The federal government put those projects on hold.

Drew FitzGerald and Thomas Gryta contributed to this article.

Write to Ryan Knutson at ryan.knutson@wsj.com and John McKinnon at john.mckinnon@wsj.com

(END) Dow Jones Newswires

March 30, 2017 05:44 ET (09:44 GMT)

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