Motorola Solutions loses first appeal on Airwave price controls, will turn to UK Court of Appeals

The United Kingdom (UK) Competition Appeal Tribunal dismissed Motorola Solutions’ appeal of the Competition and Markets Authority (CMA) ruling that the Airwave TETRA system is a monopoly and should be subject to price controls that promise to cost Motorola Solution more than $1 billion in projected revenue in upcoming years.

According to a summary released by the Competition Appeal Tribunal on Friday, member unanimously dismissed Motorola Solutions’ claims that the CMA erred in its findings that Airwave’s impact on the UK public-safety communications market has an “adverse effect on competition” (AEC) within the sector, justifying the price-control remedy. Motorola Solution had asked the Competition Appeal Tribunal declare the CMA in error and reconsider the matter.

“The Tribunal unanimously decided that … there had been no failure by the CMA to take into account a relevant consideration, nor was there any inconsistency between its findings on market definition and those made in its competitive assessment,” according to the Competition Appeal Tribunal summary.

In addition, the summary states that “the CMA was entitled to a degree of latitude in how it approached its profitability assessment; the approach it adopted was not irrational or inconsistent.”

Motorola Solutions plans to appeal the matter to the UK Court of Appeals, according to information provided by a company spokesperson to IWCE’s Urgent Communications.

If the CMA ruling is upheld after all appeals are exhausted, the proposed price controls on Airwave TETRA services would represent a revenue decrease of more than $200 million per year from the four-year contract extension that the UK Home Office signed with Motorola Solutions that began this year. Airwave was supposed to be replaced by the LTE-based Emergency Services Network in 2019, but the ESN deployment has endured delays and is not expected to be ready as an Airwave alternative until at least 2029.

Motorola Solutions expressed its disappointment in the Competition Appeal Tribunal’s ruling, noting that it changes the terms of an existing contract with the UK government.

“Motorola Solutions strongly disagrees with the Competition Appeal Tribunal’s decision,” according to a company statement provided to IWCE’s Urgent Communications. “It is highly concerning that a regulator can be allowed to tear up, mid-term, a negotiated and mutually agreed binding contract—even more so one with a sovereign government.

“We believe this unprecedented overreach will have a chilling effect on long-term investment and contracting with the U.K. Government. In our decades of operating nationwide public safety networks around the world, we have not seen anything like this.”

The Motorola Solutions statement also reiterated plans to appeal the decision and underscored the investments that the company has made to maintain the Airwave TETRA network since acquiring the nationwide LMR system in the UK almost eight years ago.

“Motorola Solutions remains committed to vigorously protecting its contractual position and we are considering all options, including our intent to appeal the decision to the Court of Appeal,” according to the statement.

“Motorola Solutions has proudly and conscientiously delivered the Airwave emergency communications service since 2016 while investing over $1.4 billion and supporting the over 300,000 emergency services professionals who protect communities across the country every day.”