AT&T says it completed five-year FirstNet buildout by March 30 contractual deadline

AT&T finished the initial five-year network buildout of the FirstNet system operating on 700 MHz Band 14 spectrum by the March 30 deadline stipulated in the carrier’s contract with the FirstNet Authority, according to a statement released today by AT&T.

As part of the 25-year deal signed with the FirstNet Authority in March 2017, contractor AT&T was required to build out a nationwide public-safety broadband network (NPSBN) that leverages the 20 MHz of 700 MHz Band 14 spectrum licensed to the FirstNet Authority within a five-year period. This five-year window opened in March 2018, when the FirstNet Authority issued the network buildout task order a few months after all 56 states and territories declined the “opt-out” option in favor of having AT&T construct FirstNet within their jurisdictions.

AT&T was supposed to complete the nationwide Band 14  buildout by March 30. The carrier claims it completed this task on time, although the FirstNet Authority still must validate that all work was done appropriately.

“We’re 100% complete with our FirstNet build requirements mandated by March 30 and anticipate exceeding our contractual requirements for FOC [final operating capability] once fully validated by the FirstNet Authority,” according to an AT&T statement provided to IWCE’s Urgent Communications.

Under the contract with the FirstNet Authority, AT&T could be paid a maximum total of $6.5 billion for deploying the NPSBN on Band 14 airwaves within the scheduled five-year timeframe. In the carrier’s most recent 10-K filing with the SEC earlier this year, AT&T states that it expects to receive “almost” all of the $6.5 billion it is eligible to receive from the FirstNet Authority—an indication that at least some FirstNet tasks would not be finished successfully on time.

AT&T passed previous FirstNet buildout benchmarks at least six months earlier than required by the contract and has been paid more than $5 billion by the FirstNet Authority for that work. However, AT&T officials repeatedly have acknowledged that completing the project may not be finished ahead of schedule, noting that the final 5% of the buildout would be the most difficult part to complete, because it involves providing coverage in some of the most difficult geographic locations and/or regulatory environments.

In addition to receiving the potential $6.5 billion in buildout revenue—money generated by FCC spectrum auctions—AT&T is able to leverage the Band 14 spectrum to support its commercial customers at times when public-safety FirstNet subscribers are not using the airwaves with always-on priority and preemption.

From a FirstNet Authority perspective, the contract calls for AT&T to build the NPSBN on Band 14 spectrum and to make annual payments to the FirstNet Authority that are scheduled to total $18 billion over the 25-year term of the deal. About $3 billion of this money is expected to fund the FirstNet Authority’s operational costs for 25 years, while the remaining roughly $15 billion must be reinvested to improve the FirstNet system.

This arrangement is designed to allow FirstNet and the FirstNet Authority to be financially self-sustaining—a mandate from Congress when the FirstNet legislation was passed in 2012—and to provide the funding necessary to provide technological upgrades to the NPSBN, such as the transition from 4G to 5G services.

To date, the FirstNet Authority board has spent system reinvestment funds to bolster FirstNet’s fleet of deployable assets, upgrade the dedicated FirstNet network core to support 5G services, and to initiate an in-building coverage program to ensure that FirstNet works inside key public-safety facilities, such as fire stations and police headquarters.

If the FirstNet Authority validates AT&T’s claim of NPSBN completion, the massive FirstNet project would be completed on time and on budget—a combination that has proven elusive for many large government IT and communications projects in the U.S.