Signs don’t look good for M/A-COM in New York

There has been no official word out of New York state, but it’s becoming increasingly doubtful that the first phase of the statewide wireless network (SWN) built by Tyco Electronics Wireless Systems (formerly M/A-COM) passed the system integration tests that were completed on Nov. 21.

For the record, New York Office for Technology spokeswoman Angela Liotta said the state is “still evaluating the results and evaluating our options based on those results.”

In other words, there is no news regarding the $2 billion LMR contract, right? Perhaps, but the tea leaves don’t look good for Tyco. Had the first phase of the network— covering Erie County and Chautauqua County—passed the system integration tests, there would be no “options” to evaluate, as the next step was pre-determined to be an operational test involving users, if the system passed the November tests. Under the original schedule, operational testing was supposed to begin on Dec. 3.

Instead, we’re more than a month beyond that date and nothing is being stated publicly, as even the SWN Advisory Council meeting in December turned out to be a closed session. Even allowing for time lost because of the Thanksgiving and end-of-the-year holidays, it’s hard to believe that the evaluation process for the tests completed on Nov. 21 is not basically done.

Of course, there could be some unforeseen holdups associated with getting approvals during a post-election transition period, especially when the state of New York is facing a significant budget shortfall as a result of the poor economy.

But a more likely scenario is that the state is not pleased with the results of the tests—something that would not be a surprise, as Tyco reported it addressed only 12 of the 19 deficiencies cited in the state’s default letter to the vendor, claiming that the other items were not part of the contract—and is trying to determine its next move.

If that next move ends up being a decision to nix the $2 billion contract, the state may be working to ensure that it has not missed anything that it could regret later in court, which is where this matter almost certainly will land if the state simply attempts to end its relationship with the vendor.

To date, Tyco has been very quiet on the subject—including yesterday, when Urgent Communications last called the company—seemingly wanting to avoid the possibility of saying anything that might offend the state. However, if the state decides to terminate its relationship with the company, one would assume that approach would change. Indeed, one SWN Advisory Council member has noted that portions of Tyco’s most recent update to the state read more like a legal brief than an engineering summary.

Given the stakes, a vigorous defense by Tyco would be expected, if the state opts out of the contract. From a financial standpoint, the $2 billion deal is believed to be the largest LMR deal in the history of the U.S., so losing it certainly would be a black eye for the company.

Perhaps just as important, having a high-profile customer like the state of New York contend that the Tyco-built system doesn’t work—something that probably is a prerequisite to opting out of the contract—could put a significant damper on the company’s reputation throughout the industry and its ability to secure future contracts.

Of course, these are all just hypothetical scenarios right now. Officially, nothing has happened. Hopefully, representatives for both the state of New York and Tyco are working behind the scenes to forge a resolution to the situation, whether that means amicably agreeing to part ways or giving the vendor yet another chance to fix the perceived problems with the network.

After all, going to trial in this case promises to be messy, expensive and time consuming for both sides—and litigation would do nothing to enhance public-safety communications in New York state.

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