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Motorola plots Emergency Services Network exit

On the back of a stinging report, Motorola begins exit strategy from UK Emergency Services Network, which is revealed to have acted as a $147m fixed asset impairment

Just over two weeks after a UK Competition and Markets Authority (CMA) investigation into the role of the Airwave infrastructure in the nation’s Emergency Services Network (ESN) concluded that the tech firm appears to be charging prices well above competitive levels, Motorola has made what it calls a “business decision” to begin negotiations regarding an early exit from its ESN contract.

The statement regarding the ESN exit came in Motorola’s financial results for the quarter ended 1 October 2022, in which the firm noted that the company now believes the future service potential of the ESN assets is limited, contributing a fixed asset impairment to the value of $147m. Negotiations with the Home Office of the UK are said to be under way.

The ESN comprises a UK-wide 4G mobile network designed to serve the needs of the UK’s ambulance, fire and police services and assorted associated bodies, replacing the reliable and well-liked Airwave terrestrial trunked radio network (Tetra).

The Airwave network currently enables the UK police, fire and other emergency services to communicate securely with each other in the field.

The ESN was designed on the basis of offering a secure private mobile radio communications platform for all organisations involved in public safety to be used by the country’s first responders. Motorola Solutions won one of the key contracts for the delivery of ESN in 2015, and acquired Airwave Solutions, the owner and operator of the Airwave network, in 2016. There have been increasing concerns about the delays to the roll-out of ESN and costs to the UK taxpayer of the continuing operation of the Airwave network, which is now expected to continue operating until the end of 2026.

Yet, almost from inception, it was dogged by questions as to whether the project was commercially viable. In October 2021, the CMA opened an investigation into the role of the Airwave network in the ESN, in particular the impact of Motorola’s dual role as the owner of the company providing the current mobile radio network and as a key supplier in the roll-out of the planned new network.

With the CMA having considered the evidence and reviewed the responses to the consultation, an independent group will now investigate the sector and decide whether there are problems, and if so, put in place appropriate solutions.

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In its provisional findings published in October 2021, the CMA found that the Home Office was being charged more by Motorola to use the Airwave network than should be the case.

The organisation outlined a set of proposed changes to limit the price Motorola can charge to a level that would apply in a well-functioning, competitive market.

As the report was published, Motorola Solutions said it rejected entirely what it called the CMA’s “unfounded and incorrect calculation” of excess profits, which it said was based on an arbitrary time period of the Airwave project.

And emphasising that the CMA’s findings were provisional, a Motorola Solutions spokesperson told Computer Weekly that going forward, the company would continue to work with the CMA to demonstrate the value for money it said the Airwave network provided to the UK taxpayer.

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