Big Telco freaks out as unknown operator with great political connections vies for valuable 5G space in America

The swamp is full to the brim as usual in Washington DC, it seems

Analysis The powerful US telco lobby has come out fighting against an outsider and its efforts to snaffle tens of billions of dollars worth of much-needed 5G spectrum.

In what appears to be the end-game to a two-year effort to make a fortune by grabbing bandwidth currently assigned to the Department of Defence and use it for commercial 5G efforts, unknown company Rivada Networks is reportedly close to winning a contract from the Pentagon to lease a huge slice of mid-band spectrum to build a new national 5G network in the States.

Telcos are furious, with both AT&T and industry group CTIA publishing blog posts this week condemning the approach. AT&T’s head of regulatory relations, Joan Marsh, has called the idea “drastic and unproven” and CTIA head Meredith Attwell Baker “a radical departure.”

The issue has even hit the mainstream news, with CNN digging into the usual dry and comparatively uninteresting topic of spectrum management and claiming cronyism.

There is certainly something unusual going on. A series of out-of-the-ordinary processes and decisions have surrounded the valuable spectrum since 2018, including persistent suggestions from the White House that it may be a good idea to nationalize 5G, rather than leave it to the free market. The issue has grown murkier with the involvement of a number of high-powered Republican lobbyists and former Congressmen.

Two businessmen facing each other shouting into loudhailers

America’s 5G efforts get shot in the arm with mid-band spectrum free-up


According to the chair of the US House Energy and Commerce Committee's Communication and Technology panel, those men include: former deputy chief of staff and senior advisor to President George W Bush, Karl Rove; former Speaker of the House, Newt Gingrich; controversial tech billionaire Peter Thiel; and former Trump campaign manager Brad Parscale.

But Rivada – a completely unknown and privately held company – has denied in the strongest terms claims it is on the cusp of bagging a sweetheart deal for the valuable spectrum – specifically, the assertion it will land a no-bid contract for the frequencies.

"The story is a steaming pile of BS," its spokesperson told The Reg. "We have always and consistently advocated for a competitive process to determine the best way to share DoD spectrum between commercial and government use."

Rivada CEO Declan Ganley also took to Twitter to mock reports of a no-bid deal: "Just watched a hilarious CNN report claiming that the White House wants to 'fast track a contract for Rivada without a competitive process' (a lie). And that it would be 'the biggest hand off of economic power to a single entity in history.' Who owns CNN? That's right, AT&T."

With tens of billions of dollars at stake, Washington's culture of backroom deals, heavy spin, media leaks, and aggressive denunciations is in full effect.


The 5G nationalization idea first appeared in January 2018, and we wrote about how pretty much everyone from Big Cable to the FCC to the Department of Commerce’s NTIA arm was bitterly opposed to the idea. But for some reason, it kept reemerging as a proposal with the White House repeatedly expressing support for it.

At the heart of the issue is a drastic shortage of bandwidth that is needed to roll out next-generation 5G networks in America. The need is such that all arms of the US government unusually agreed to free up unused spectrum to make 5G possible, which led to an announcement in September that the US military was going to make over 100MHz of contiguous mid-band spectrum, in the 3450-3550 MHz band, available for 5G within months.

The announcement sparked surprise, not least because of how quickly agreement had been reached: we praised it as “a rare example of the Trump Administration using pressure tactics in a constructive, rather than destructive way.”

We should have known better, because within weeks, rather than simply agree to make the spectrum available via auction, which has been the system used for decades, the Pentagon issued a “request for information” in which it sought “insight into innovative solutions and technologies for dynamic sharing of the department’s current spectrum allocation.”

That may sound inoffensive, yet it immediately raised the hackles of the mobile industry, which wanted to know why the Pentagon was looking at creating an entirely new process rather than go with the FCC’s longstanding approach for spectrum distribution.

Suspicions high

Lawmakers were also on the case. “We have heard reports that the suddenness of this request and the short turnaround timeframe have been prompted directly by senior White House Officials,” a letter from the chairs of the House’s Energy and Commerce Committee and Communication and Technology Subcommittee to the US government at the start of October read.

The letter listed the Republican operatives above and their connection to “a specific company, Rivada, Inc, which has long championed a national network that Rivada would construct and operate using its sharing technology.”

Rivada is a largely unknown entity. It is privately held with no track record in the industry and has repeatedly pitched for government telco contracts. A main investor is Peter Thiel, who has strong connections with the defense department through his controversial Palantir data company.

In 2017, Rivada went for the $6.5bn contract to run FirstNet, a national safety network, but lost out to AT&T, in large part because it didn’t have any expertise or business other than bidding for the contract. Rivada appealed the decision. It was rejected.

Then came the unexpected White House-slash-Dept-of-Defense announcement that it would free up 100MHz of spectrum, a massively valuable asset, followed by the even more unexpected decision to ask for ideas on how to allocate it, something that industry analysts said stemmed from the White House, not the Pentagon. One high-profile analyst, Craig Moffett, told CNN the whole thing “smacks of cronyism at best and reeks of 'the swamp' at worst.”

In recent days, rumors started swirling that the Pentagon, pushed by the White House, is about to announce a no-bid contract process for an even larger slice of spectrum – a massive 350MHz worth more than $20bn – and that the recipient will be Rivada. And that’s when all hell broke loose.

Rivada denies the existence of any such special deal, though it very much is interested in acquiring the rights to wireless spectrum. Its spokespeople were also dismissive of the traditional spectrum auction approach in a statement to The Register, claiming it has "become a barrier to entry rather than a facilitator of it." ®

Similar topics

Similar topics

Similar topics


Send us news

Other stories you might like