Tuesday, December 17, 2013

Is the Obama Administration intentionally forcing FirstNet -- or National Public Safety Broadband Network -- down a path of creating an all encompassing Federal Organization?

It may be just me, but has anybody else noticed that all the States that have received BTOP and spectrum lease agreements are termed “Blue” States? It’s just an observation. Yes, I know Texas has their spectrum lease as well, but it’s only a 90-day lease and has to be renewed. Plus, Texas didn’t take any BTOP money, so you would think it would be easy for Texas to get their spectrum in that FirstNet, and the NTIA, don’t have to worry about the use of Federal dollars, and technically you only have a few options when it comes to the LTE provider, so what’s all the fuss? Well in the case of Texas it may be the perception of being a Motorola shop. That perception tends to scare people away, which would include your ability to get fair and balanced proposals from the industry in order to build your solution, but I digress.

Could there be an administrative ploy or alternative agenda? Someone has to ask. After all, could you imagine what would happen if Texas got their Lease Agreement holistically signed, that is covers the entire State, and is ready for the build-out? As a friend pointed out to me today, at the moment the animal is caged, if you let the animal out they will start to breed everywhere and eventually the owner would lose control of trying to manipulate the animals into domestic servitude. For some reason a pen full of pigs with red lipstick comes to mind. Do I have to layout the analogy here?

The point is that perception is everything when dealing with government related programs, and at the moment it is starting to become clear that the States, who happen to be blue (Democratic majority) are the ones getting their approvals, and the so called “Red States” are not. It’s just an observation at this point in time and may be just coincidental, but is it? Is the plan for FirstNet being intentionally wired so that a Blue version of the FirstNet Broadband Network is forced onto the Public Safety community? Or does it just happen to be going that way because the ideas of the Administration more align with the philosophical mindset of the Blue State? To me it could be perceived that the prior version may actually be the plan, allow me to explain.

Remember, this is just an observation and shouldn’t be construed as a doomsday theory, if you read the legislation that was passed (Middle Class Tax Relief and Jobs Creation Act of 2012), which released the spectrum to Public Safety, it actually had some hidden gems of direction written into the Act.  If I were road-mapping the actions to take for the next 5-10 years, I would want to prepare the design, and its rollout, according to my long-term plans as to entrench the entire solution into “my” long-term goals. I would do this because, essentially, no one can change my plans once it gets started, such as, a change in the administrative mindset from blue to red. These little gems, plus the lack of a business model -- or maybe a model that nobody knows about -- may lend itself to setting up just such a long-term deal. In this case you start building the network based on the relationship and support from those States that align with your mindset, and your long-term strategy, so that it becomes so arduous and insidious that once it gets going, it will be too hard to change. Or is it simply the spoils of war?

By the time this network really gets going, it will be the election year, which could mean disaster is unavoidable if the Feds are going to try and deliver the network. It’s always quite complicated when you try to change horses mid-way through a race, especially when you have an election coming up.  I have a hard time seeing Bill D’Agostino, GM for FirstNet, trying to work such a plan, plus he wasn’t around when the legislation was written. If others had planned the rollout in this manner, there is one thing they did not fully explore…. that is the “Public Private Partnership” model.

There are literally hundreds of ways you can administer a Public Private Partnership (P3), but the only model that will truly work in this instance, is the same capitalistic model the telecom industry uses; that is to monetize the use of the spectrum and then apply it’s architecture outside of the business case of the Public Safety’s responsibility, yet, at the same time specifically built for their needs, thus the “Public Safety Services Organizations” nomenclature for available users.  This means that the Act changed the mindset of just the  “Public Safety Organizations” probably because they realized, long before FirstNet was created, that in order for their plan to work they need to tie it to the fabrics of our society that are already entrenched with government regulations and administration, such as Municipal Utilities or Transportation Authorities. But I don’t think they, the people who formulated the Acts strategy, truly realized the power of ingenuity and entrepreneurial spirit when it comes to a true Public Private Partnership and the monetary value of the spectrum, or maybe they did?

As an example, the strategy may have failed to account for such entities as Investor Owned Utilities, or the Electric Cooperatives, who have their own infrastructure and requirements to please shareholders.  The potential users are in the business of delivering power at the same time they have complex telecommunication needs and are usually the first people called (by the Police I might add) to respond to a natural disaster. The Utility would find it more advantageous to buy from the State based P3 for its truly hardened telecom needs, not the flimsy carrier network, or worse yet a government run public safety network. If the government run network becomes the business model then the Utilities, especially the Investor Owned Utilities, will have a hard time getting access because the government mechanism will undoubtedly create silo's of First Responders which will mean a stretch in defining Utilities as part of that group. Imagine being an electric cooperative that has to invest 100 Million into building your own broadband solution to meet SMART Grid demands mandated by the Department Of Energy (DOE), you have no spectrum and there is no foreseeable dedicated spectrum to come, wouldn’t it be easier to put that money back into load-sharing and fixate your bottom line to a much smaller OPEX model at the same time still meeting DOE demands? The only way to achieve this is with a capitalistic model of venture-funded program monetizing the spectrum for the State, just like a carrier.

There is no other model that will completely fund, both the long-term and short-term capital needs; reach 100% statewide coverage; build revenue for the State and the P3 while avoiding taxpayer money; as well as diligently meeting FirstNet technical standards. Plus, it’s just better for the State.

If you build and deploy this network on a holistic national model, we will be forced into a carrier comparison, which ultimately means we would have to compete on subscriber based cost-per-handset model that will undercut your ability to get enough money to fund your long-term plans and short term capital initiatives.  We simply can’t build this on the subscriber model when the handset manufacturers keep cutting prices even lower, how will you pay for the deployment of LTE? How do you convince a Police Chief that he should buy service from FirstNet when he already gets fixed monthly service for $35 per month and a $10 dongle from the carrier? The only way to overcome this is to give the service, and the handset, for free, and you can only make that happen in the P3 model...not the government run model, unless of course we tax the American people which will be predominately on the shoulders of the States.... again. A government run model, by comparison, will have to compete with service already rendered, but in reality they will need to charge thousands of dollars per-monthly-charge in order to account for the money needed to pay for the deployment. Don’t know about you but my toilet costs about $100 bucks not $35,000. This is why, long before FirstNet, the term “Public Safety Service Organizations” was utilized, and someone had a plan, and a strategy, and knew that such a network would build a powerful, all encompassing, federal agency.

So why is it that only "Blue" States have their Spectrum Lease Agreements and their BTOP money released?

Once again, it’s just an observation from none other than….

Just some guy and a blog….

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