Commnet Signs $167M Agreement with AT&T to Build FirstNet Network in Southwest
Friday, August 09, 2019 | Comments

Commnet Wireless entered a $167.5 million network build and maintenance agreement with AT&T Mobility for Commnet to build a radio access network (RAN) for AT&T’s commercial and First Responder Network Authority (FirstNet) network in or near Commnet’s operating area in the Southwest.

AT&T will pay Commnet about $167.5 million for construction and maintenance at a fixed amount per completed site. If the cell site is located on a communications tower owned by Commnet, AT&T will pay rent to Commnet under a separate lease agreement with an initial term of eight years, with an option to renew for seven additional five-year terms.

AT&T will provide Commnet, a wholly owned subsidiary of ATN International, with the equipment and materials necessary for the construction of the RAN. All cell sites must be completed and accepted by AT&T within a specified period of time. Following acceptance of a cell site, AT&T will own the cell site, and Commnet will assign to AT&T any third-party tower lease applicable to such cell site.

Commnet will also provide ongoing site maintenance for an initial term 10 years, with five successive three-year renewal terms unless either party gives written notice of non-renewal.

Commnet also agreed to provide AT&T with high-capacity transport to and from the cell sites. AT&T will continue to use Commnet’s wholesale domestic wireless network for roaming services at a fixed rate per site during the build period until the cell site is transferred to AT&T.

The agreement was disclosed in a Commnet Securities and Exchange Commission (SEC) filing. Commnet’s coverage covers mainly parts of Nevada, Arizona, Utah, Colorado, New Mexico and Nebraska, according to website maps.

In its own SEC filing, AT&T said total reimbursements from the government for FirstNet during the first six months were $134 million for 2019 and $336 million for 2018, predominantly for capital expenditures. During the first six months, about $600 million of assets related to the FirstNet build were placed into service, AT&T said.

A Department of Commerce Office of Inspector General (OIG) audit released last month found that FirstNet did not comply with the terms of the nationwide public-safety broadband network (NPSBN) contract prior to approving the 2018 $336 million payment to AT&T.

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