AT&T spectrum-lease announcement a potential boon for utilities

This week, AT&T announced that it is willing to lease its licensed spectrum to utilities for 15 years, providing the utilities the spectral foundation they need to deploy the kind of private LTE networks that will support evolution of the smart-grid vision that is designed to make utilities more reliable and more efficient.

My guess is that AT&T will get plenty of interest from utilities, which have significant needs for low-latency, high-bandwidth, broadband wireless networks to make almost-instantaneous decisions that can keep the lights on and clean water running. Many utilities have the money to deploy their own private LTE networks—and the fiber assets needed to provide backhaul from potential LTE sites—but they generally lack the spectrum necessary for such a wireless system.

It is for these reasons that I have long believed that utilities could be ideal complement to public safety on the nationwide first-responder broadband system being built by FirstNet. After all, utilities and public safety both need a dedicate network that is reliable enough to work when everything else fails, and FirstNet has the spectrum assets that utilities needs, while utilities could bring valued users and some impressive network assets to the table, particularly in remote areas where carriers typically don’t provide coverage.

But the utility-public safety combination hasn’t happened within FirstNet, which opted for a deployment model that relies more on the assets controlled by the contractor team than by those held by potential users.

While I believe priority/preemption and “public-safety entity” issues could be resolved, it would not be easy (perhaps that’s one reason why FirstNet chose not to address the “public-safety entity” question in its request for proposal, despite conducting two proceedings to get input on the subject). Meanwhile, the state approval/opt-out process associated with FirstNet is so convoluted that it would be tough for a utility with a footprint that includes multiple states to estimate when deployment would be complete throughout its territory.

From that perspective, the spectrum-lease arrangement with AT&T—not to mention the proposal from pdvWireless in the 900 MHz band, if it ever receives FCC approval—has to be intriguing to utilities. Conceptually, such spectrum lease would let utilities proceed with the buildout of a private broadband network at a pace that is acceptable to users, shareholders and regulators, and there should be no questions of priority or network control.

This arrangement also offers an opportunity for the carrier and the utility to negotiate the best possible business arrangement for both parties—for example, a discount to a utility providing fiber backhaul assets, particularly if the infrastructure also is leveraged to expand the carrier’s coverage into a rural or remote area.

What is surprising about the AT&T announcement is the notion that the carrier—always an advocate for federal-government efforts to make more spectrum available for commercial wireless—is willing to dedicate some of its precious spectrum assets in this manner.

My guess is that there are some policymakers who are scratching their head. Five years ago, carrier officials steadfastly said that they would not provide priority access on their networks to public safety or other critical-infrastructure entities. In fact, that position was cited a major reason why Congress decided to establish FirstNet.