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How AT&T's utility dreams crashed and burned

For almost four years, AT&T and Nokia worked diligently to sell private wireless LTE services to utility operators around the country.

And for a while, the effort looked like it would be a smashing success. In 2019, AT&T reported it counted contracts with 15 different utility companies across 18 states in the US, with another 14 utilities on the hook. The utilities planned to lease spectrum in AT&T's WCS C and D Block holdings to build private wireless networks using Nokia's LTE equipment for a range of services like meter monitoring and disaster recovery.

"AT&T reasonably expect[ed] to contract with those utilities to deploy LTE smart grid service over the next 12-24 months," the operator told the FCC.

And then the FCC messed everything up, at least according to AT&T.

"Changes to the market dashed these expectations," AT&T wrote. "Significantly, as a result of commission actions, other spectrum became available to utilities, causing them to alter or reconsider their interest in leasing AT&T's WCS spectrum."

Better options

AT&T specifically pointed to the FCC's moves in 2020 to auction 3.5GHz CBRS spectrum licenses, and its decision to allow LTE operations in the 900MHz band. Utilities leapt at the opportunities: Almost a dozen utility providers purchased CBRS spectrum in the auction, and a growing number have been inking deals to use 900MHz licenses from Anterix.

"Utilities found the prospect of holding their own broadband spectrum licenses potentially more attractive than leasing C and D Block spectrum from AT&T," the operator candidly admitted. "As the utilities decided to pursue (or at least contemplated pursuing) spectrum alternatives, new contracts became harder for AT&T to secure in a timely fashion. Utilities already under contract took a wait-and-see approach instead of making long-term commitments to new deployments. On top of the challenges posed by newly available spectrum, the COVID-19 pandemic stretched the already-lengthy utility decision making process past the point where deployment was possible by the buildout deadlines. With all these headwinds, AT&T's progress toward the alternative performance benchmark for its C and D Block licenses slowed significantly over the past year."

This, according to AT&T, was the last straw.

AT&T told the FCC it has "terminated its agreements with utilities to provide LTE smart-grid service over that WCS spectrum ... None of the C and D Block networks that AT&T had begun to deploy remains active."

It's not clear which utilities had planned to use AT&T's WCS spectrum, but utility provider Ameren last year said it tested operations in AT&T's WCS spectrum. In December, Ameren inked a 30-year lease from Anterix for 900MHz spectrum.

AT&T and Nokia in October announced they would begin offering private wireless LTE services in CBRS spectrum.

Not for lack of trying

This brings to a close almost a decade of attempts by AT&T to somehow make money from the two unpaired 5MHz C and D Block channels it purchased from NextWave Wireless in 2012 in a broader deal valued at up to $600 million. AT&T initially had planned to leave those C and D Blocks vacant to prevent interference, instead running its mobile LTE operations in WCS A and B Block spectrum. But shortly after buying the spectrum, AT&T signed an agreement with SiriusXM (which operates its service in nearby spectrum) to run LTE operations in the WCS C and D Blocks.

Over the course of the past decade or so, AT&T told the FCC it tried everything in those C and D Blocks "including fixed wireless local loop service; reconfiguring the 2.3GHz band (e.g., by reducing the center frequencies of the A, B, and D Blocks); low-power network overlay used for communication among Internet of Things-type devices; additional CMRS network capacity in indoor spaces like arenas or convention centers; supplemental downlink; LTE Direct (a device-to-device technology enabling the discovery of devices within a certain proximity); air-to-ground service; wireless backhaul; mobile broadband as part of AT&T's CMRS network."

Nothing was successful.

The company's utility effort, launched in 2016 with Nokia, represented a last-ditch attempt by the company to make money from its WCS C and D Blocks. AT&T managed to obtain a spectrum-buildout waiver from the FCC for the strategy; the agency gave AT&T a few extra years to launch commercial services in the C and D Blocks. If AT&T doesn't put the C and D Blocks to use, the spectrum licenses could revert back to the FCC's control.

SiriusXM deal

Now, AT&T has essentially given up on the C and D Blocks. The company told the FCC it has reached an agreement with satellite radio operator SiriusXM to transfer the licenses to SiriusXM. The FCC would have to approve the transaction; terms of the deal were not disclosed.

SiriusXM has its own plans for the C and D Blocks.

"SiriusXM plans to offer a service to public safety organizations like FEMA [Federal Emergency Management Agency] and Homeland Security where WCS SiriusXM devices are placed in advance of emergencies to provide one-way communications to those received in cases where the communication infrastructure is significantly impacted," explained Brian Goemmer, the founder of spectrum-tracking company AllNet Insights & Analytics, in comments to Light Reading. Goemmer first uncovered AT&T's new filings on the WCS topic.

"No mention was made of whether any hardware or software changes would need to be completed on SiriusXM satellites to support wider operations into the WCS bands," Goemmer added.

Whether SiriusXM will be able to succeed where AT&T failed remains to be seen.

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Mike Dano, Editorial Director, 5G & Mobile Strategies, Light Reading | @mikeddano

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